A year later, the realities of global economics and the president’s trade policies have resulted in a very different message from Trump. Three of his five trade-related tweets Tuesday morning mentioned Harley. But the company’s announcement, which was made Monday in a regulatory filing, was partly due to the trade dispute Trump himself sparked earlier this month. When the Trump administration announced levies on European steel and aluminum imports, the European Union responded with retaliatory measures—in Harley’s case, the company said EU tariffs would add more than $2,000, on average, to the cost of each a motorcycle exported to Europe. And yet the deeper reason for Harley’s decision is that, despite the presidential imprimatur of a storied “Aura” about the brand, Harley, and indeed most other motorcycle makers, have seen steadily declining sales. Europe had offered Harley a rare bit of good news.
Until the tariffs. The EU’s retaliatory tariffs, which are worth $3.2 billion, specifically targeted bourbon, peanut butter, and Harley’s motorcycles, among other things—items that are, not coincidentally, made in Republican-controlled districts of the United States. Making its motorcycles in Europe would allow Harley to avoid the tariffs incurred through export and keep the profit it earns on each motorcycle sold. But tariffs aside, there are deeper forces driving Harley’s long term reorientation, one chief among them: evolving consumer tastes. [...]
All of this, however, doesn’t change a larger truth about Harley-Davidson, in general, and the motorcycle industry, in particular. Young people are simply not buying motorcycles the way Baby Boomers did. Plenty of reasons have been cited for this, including rising student debt and the loss of motorcycling’s allure, but the development, and Trump’s response to it, is part of a broader pattern. The president sees the offshoring of jobs as having resulted in the hollowing out of the American middle class, and blames unfair trade for what has befallen the American worker. But he’s using trade tools to respond to trends that may actually have little to do with trade at all.
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