In April, 2021, the European Union (EU) requested the Belgian Ministry of Economy to revoke Harley-Davidson's of its Binding Origin Information (BOI) status. The BOI credentials allowed the American manufacturer to skirt the EU’s 31-percent tariff on motorcycles over 500cc (from the States) by importing EU models from the company’s Asian factories.
To add insult to injury, the EU also announced that it would increase those same import taxes to 56 percent by June, 2021, resulting in a 50-precent increase for the Motor Company. The plot thickened when a coalition of European and American businesses and associations rushed to Harley’s side by May 3, 2021. The alliance called for the suspension of the tariffs and a return to amicable trade relations between the two countries.
Now, in the 11th hour, the European Union and the U.S. released a joint statement announcing the “start of discussions to address global steel and aluminum excess capacity.” European Commission Executive Vice President Valdis Dombrovskis, United States Trade Representative Katherine Tai and U.S. Secretary of Commerce Gina M. Raimondo will conduct the trade talks, extending the potential 56-percent tariff increase deadline to the end of 2021.
“We are encouraged by today’s announcement that tariffs affecting our products will not escalate from 31% to 56%,” said Harley-Davidson CEO Jochen Zeitz. “This is the first step in the right direction in a dispute not of our making. Harley-Davidson employees, dealers, stakeholders and motorcycles have no place in this trade war.”
While the bar and shield is clearly relieved by the news, Zeitz’s comments confirm that the brand is still incurring a 25-percent tariff increase after losing its BOI status. As trade talks continue, Europe’s Association des Constructeurs Européens de Motocycles (ACEM) continues to call for officials to remove motorcycles from the steel and aluminum trade negotiations.
“These tariffs provide other motorcycle manufacturers with an unfair competitive advantage in the E.U. European motorcycles only pay up to 2.4% to be imported into the U.S.,” Zeitz added. “We want free and fair trade. UNITED WE RIDE.”