May 18, 2022

Trump just proved he doesn’t understand the passage of time in bizarre attack on Harley-Davidson

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The bizarrely personal nature of President Trump’s attacks on Harley Davidson  – including today’s Twitter threat to use the power of the U.S. government to help foreign manufacturers expand in the American market – show how clueless he is about the reality and economics of global business today. 


All of the other leading motorcycle manufacturers are outside the U.S. and several already have some operations here, but getting them to expand would not change the fact the profits would be shipped to other countries. 

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Most are in countries where Trump is engaged in a trade war already including Yamaha, Honda, and Kawasaki of Japan, Ducati in Italy, and BMW in Germany points out The Washington Post. 

Trump is wrong to think Harley Davidson, as a public company, owes him more than their shareholders, employees or customers.

It goes back to the campaign and early days of his presidency.

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Trump cited Harley Davidson as an American manufacturer during the campaign and then brought executives to the White House on February 2, 2017, to say “thank you for all the votes you gave me in Wisconsin,” and then for “building things in America.”

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Trump was wrong on both accounts even then. A PAC associated with Harley Davidson did contribute $2,546 to Trump in 2016 but it also contributed $2,497 to Secretary Hillary Clinton, with its top half-dozen contributions going to a mix of Senate and House candidates from both parties.

At the time of that White House meeting, Harley Davidson already operated – in addition to its two U.S. plants – factories in Brazil, India, and Australia, so it was not manufacturing completely in the U.S. as Trump now claims. 

Even now Harley Davidson’s plan to close its plant in Wisconsin is offset by plans to expand a facility in Pennsylvania, while the new plant being built in Thailand is to produce bikes for the Asian market which unlike the U.S. is growing.

It is Trump’s unilateral imposition of tariffs on the European Union that is the reason Harley Davison is looking to move some production to Europe, where it sells about 16 percent of its annual output already. 

Harley Davidson estimates the retaliatory tariffs imposed by the E.U. will add about $2,200 to the cost of each motorcycle sold there, which would have a devastating impact on sales, so the only choice as a responsible company is to make them there and sell them there.

“The deeper reason for Harley’s decision is that, despite the presidential imprimatur of a storied ‘Aura’ about the brand,” reported The Atlantic on June 26, “Harley, and indeed most other motorcycle makers, have seen steadily declining sales.  Europe had offered Harley a rare bit of good news.”

Trump also fails to see a bigger problem, points out The Atlantic:

“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 motorcyles the way Baby Boomers did.”

“Trump’s response to it, is part of a broader pattern,” continues The Atlantic. “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.”

It was odd earlier this week to see Trump in Wisconsin heralding the arrival of a large plant built by a Taiwanese company that received over $4 billion in local, state and federal tax incentives and outright grants, and millions more in infrastructure improvements; while carping that the Harley plant in Wisconsin would have to close because of Trump’s trade war.

Now Trump wants to bring in a foreign motorcycle company that would be given, no doubt, millions or billions more in incentives and grants to expand in the U.S. and take sales away from a real American company,

Trump doesn’t get that all of these companies are part of the global business where smart companies go where costs to manufacture are low and selling places where the market is growing.

What Trump fails to understand with his “America First” agenda and his destruction of international trade agreements, both new and old, is that no one country can stand alone either in its sales or for its security.

“Harley’s announcement is among the first signs that Trump’s use of tariffs, which he has promoted as a way to boost employment in the steel and aluminum industries, is hurting other American businesses,” reported The Washington Post on June 2..

He even times shifts reality in his recent tweet, as if he lives in the past and present.

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Trump is blaming lower sale in 2017 for decisions made in 2018, which counters what he said in 2017 and reality.

Trump’s war of words and threats against Harley Davidson are exactly the wrong approach to helping American industry 

In an era when robots will continue to replace workers, chasing the shrinking number of blue-collar manufacturing jobs is not a long-term solution.

However, Trump has abandoned the real high paying jobs of the future in alternative energy and other high tech industries while fighting to save coal and other 20th-century phantom jobs, even as Europe, China, and others take the lead in low polluting, high growth industies of the future.

That a president would use the resources of the federal government to help a foreign manufacuter in order to punish an American company is bad enough but Trump is doing it as part of an agenda that is leading America down the wrong path and away from prosperity. 

Benjamin Locke

Benjamin Locke is a retired college professor with an undergraduate degree in Industrial Labor and Relations from Cornell University and an MBA from the European School of Management.

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