Trade tensions between the European Union (EU) and the United States are escalating. From April 1, an additional 25% tax will be levied on motorcycles and spare parts imported from the USA. Against this backdrop, Harley-Davidson and Indian Motorcycle are in the front line, and are likely to see their sales hit hard.
Soaring prices for European motorcyclists
The EU's decision follows the increase in US tariffs on steel and aluminum, imposed on March 12. In retaliation, Brussels is applying these new taxes, which will lead to a consequent rise in prices for the two iconic brands.
During Donald Trump's first term in office, a similar trade war had already led to higher prices for Harley-Davidson models in Europe, sometimes by as much as €2,000. This time, the impact is likely to be even heavier...
Avoidance strategies put to the test
In 2021, Harley-Davidson tried to get around these taxes by relocating part of its production to Thailand. This strategy enabled the company to temporarily escape European surtaxes. However, the new EU measures will no longer take account of the country of assembly: if the brand is American, it will be taxed.
This situation could seriously affect Harley-Davidson, which is heavily dependent on the European market, selling over 25,000 units in 2024. Already in financial difficulty in recent years, the manufacturer sees a new threat to its profitability on the Old Continent.
Does Donald Trump want to sink Harley-Davidson?
This trade war is a direct result of Donald Trump's protectionist policies, which have imposed taxes on steel and aluminum. A few months earlier, it was his own supporters who were attacking Harley for ideological reasons. The brand wanted to adopt a policy of diversity, equity and inclusion, but had to back down under the pressure of a massive boycott led by the "anti-woke" lobby on social networks.
As a result, Harley-Davidson is under attack on home soil, while being penalized internationally. To cope with this double pressure, the brand is seeking to redefine its image in order to win back its historic clientele. But above all, it understands the importance of attracting a younger audience, a focus it is actively developing through new initiatives.
A growing commercial war
This surtax on motorcycles is only part of the sanctions imposed by the EU. Other American products are also targeted, including Levi's jeans, Kentucky bourbon, soybeans, boats and household appliances. These measures are part of a broader retaliation, following several years of trade tensions between Europe and the United States.
While negotiations remain open, one thing is certain: from April onwards, buying a Harley-Davidson or Indian motorcycle will cost considerably more in Europe.
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