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Trump Goes After Harley-Davidson On Twitter

MARY LOUISE KELLY, HOST:

President Trump went after Harley-Davidson on Twitter again today. He said his administration is working with other, presumably foreign, motorcycle makers to come to the U.S. and start making their motorcycles here. Now, there are not a lot of details. It is not clear how far along these discussions are or if they're happening at all, but, once again, the president appears to be threatening to retaliate against a U.S. company for daring to shift some production away from the United States. Joining us now is Chad Bown. He's a trade expert with the Peterson Institute. Welcome, Mr. Bown.

CHAD BOWN: Hi, Mary Louise.

KELLY: Hi. So I'm tempted to say this is an extraordinary situation, the president going after an American company like this. But this seems to actually be emerging as a pattern for President Trump. I'm thinking of Carrier. I'm thinking of Amazon.

BOWN: Yeah. It's definitely not extraordinary, though - even though he's done it before it - I find it jarring every time, you know, you see an American president actually bullying a company like this. But I think it's important to get out there, you know, exactly just how normal what Harley-Davidson actually did in this instance. All they did was file, you know, a regulatory piece of paperwork with the Securities and Exchange Commission notifying their shareholders about some important changes that they were making, that they were going to move some of their production outside of the United States. Now, what was important from President Trump's perspective is the reason why, and they stated in this filing the reason why is because it's now too expensive to produce from the United States for the European market. That's basically because of his steel and aluminum tariffs that are raising their costs and the retaliatory tariffs that the European Union is putting on motorcycles because of his tariffs.

KELLY: Right. This is a bit of a Catch-22 for Harley-Davidson, right? It's a modern, global corporation. It's got plants in different countries all over the world. It's this iconic American brand, and they would argue at Harley that they're forced to make this decision because of the president's trade policy, even as he is branding Harley-Davidson as unpatriotic.

BOWN: That's right. The problem from Harley-Davidson's perspective is while they're a global brand, so are their competitors. So, you know, companies like BMW and Ducate that are European, you know, based companies, they now can sell in Europe at a 31 percent price discount relative to Harley-Davidson because they don't face those tariffs. Other competitors like Kawasaki and Honda and Yamaha, Japanese-based companies, Europe is signing trade deals with Japan to lower tariffs for them. They can now sell, you know - or they'll be able to sell for a lower price in Europe as well. At the same time, President Trump is going in the opposite direction. He's raising tariffs against everybody. So it's just making it difficult for a company like Harley-Davidson to compete.

KELLY: The president made a point in his tweet this morning that I was struggling to follow. He repeated his claim that Harley owners are not happy with the president's decision to move some production overseas. And as evidence, he appeared to offer that Harley sales were down in 2017, the suggestion being sales were down last year over something that actually happened last week.

BOWN: Yeah, this was a tough one to follow, though, you know, I think the important thing to keep in mind is President Trump's common strategy when things aren't going his way is to try to find someone else to blame. And, you know, essentially that's what he's doing here, especially when the real underlying source of the problem is his own policies. Now, you know, what may be happening with Harley-Davidson is, you know, it could be a couple of things. The traditional market for...

KELLY: Name one. We've just got a few seconds.

BOWN: ...For Harley-Davidson is older riders, baby boomers, they may be aging out of, you know, Harleys. You know, the future demand may not be there. The future demand may be in the 7 billion customers outside the United States.

KELLY: Many questions there about demand and trade. Chad Bown, thanks very much.

BOWN: Thanks for having me.

KELLY: Chad Bown of the Peterson Institute on NPR News. Transcript provided by NPR, Copyright NPR.