"Penalty duty"

EU wants to collect more than 50 percent customs duties on Harley-Davidson motorcycles

When two argue, it hits the third

In April 2021, a message from Brussels caused great astonishment at Harley-Davidson: The EU Commission has withdrawn the company's Binding Origin Information (BOI), which means that a "punitive duty" will be due – one that has it all: From 1 June 2021, Harley-Davidson is to pay customs duties totalling 56 percent on every motorcycle sold in the European Union.

As a reminder, after the Trump administration decided in June 2018, for protectionist reasons, to impose a tariff of ten percent on European aluminum products and 25 percent on European steel products, the EU hit back and published a list of U.S. products – including motorcycles with a displacement of more than 500 cubic centimeters – which have since been subject to additional tariffs when imported into the EU. For the machines from Milwaukee, the whole thing added up from six to 31 percent customs duty. Harley-Davidson did not unload the additional burden on the shoulders of the clientele and instead bore the drastically increased costs itself for a while. Only a good year later, the situation changed: Since the end of 2019, almost all Harleys for Europe come from Thai production and a BOI approval of the EU now ensured a moderate tariff rate of six percent for the import of these machines.

This BOI, the EU wants, should no longer apply and at the same time the "punitive tariff" will be doubled to 50 percent. This means that gasoline-powered Harley-Davidson motorcycles will in future be subject to an import duty of a total of 56 percent, regardless of their place of manufacture. Quite unfair, finds the Association of Harley-Davidson Dealers e. V., because European motorcycle manufacturers can continue to export to the USA with significantly lower import duties: 1.2 percent are due for machines up to 800 cubic centimeters, up to 2.4 percent for bikes over 800 cubic centimeters and 2.5 percent for cars.

Matthias Meier, Chairman of the german-Austrian and The European Association of Harley-Davidson Dealers, explains: "The EU's decision contradicts our idea of fair trade relations. It creates a blatant competitive disadvantage for our motorcycles compared to other brands and therefore has a massive impact on our business activities as authorized dealers." Antonio Perlot, Secretary General of the European Two-Wheeler Manufacturers Association ACEM, added: "We call on the European Commission and the new US administration to resume a positive transatlantic trade dialogue. We remain committed to ensuring that both parties return to reason and find a solution."

What effects the EU decision will have on the European Harley-Davidson trade and European customers is not yet foreseeable. "One thing is certain: the whole thing is much more than just unjust, it threatens existence," emphasizes Matthias Meier. "We authorized dealers almost all sell only the Harley-Davidson brand and ensure more than 10,000 new registrations with the bar-and-shield logo on the tank every year in Germany alone. In Germany, 67 authorized dealers with around 1,000 employees are affected by the potential effects, in Europe there are around 370 H-D dealerships and the number of jobs affected is about 5,500. And in all this, of course, we must not forget thousands of customers in the EU. We do not want to be crushed between the millstones of politics in this trade conflict with our customers and the brand's fans. We therefore welcome the fact that the manufacturer Harley-Davidson appeals against the EU decision."

The Association of Harley-Davidson Dealers remains committed to free and fair trade and hopes for the solidarity of the entire European motorcycle scene.

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