American Motorcycle Manufacturers Paying 100% Tariff Abroad. True Or False?

Last Tuesday evening, in a speech to Congress, Harley-Davidson was singled out by President Donald Trump as example of an American company having difficulties to sell abroad because of high tariff and taxes reaching 100%.

President Trump didn’t mention any country, but the example he was talking about is India imposing a 100% tariff on all imported motorcycles with engines larger than 600 cc. Other notable countries with high tariffs on large motorcycles (see chart) are Thailand, China, and Malaysia.

President Trump called for free, but fair, trade. It’s true that the United States doesn’t impose tariffs on  importing other countries’ motorcycles.  But if the US doesn’t tax imported motorcycles, it taxes many other products. For example, imposes tariffs on imported 103% on milk, 77.9% on tobacco, 24% on of clothing made of synthetic fibers, etc) As a matter of fact, Census figures show that the US collected $1.1 billion in tariffs on $46 billion of goods imported from India in 2015, for an average rate of 2.4%. India collected $2.1 billion of tariff on $21.5 billion of imported US goods, an average of 9.64% according to the International Trade Centre.

In addition, it’s not true that Harley-Davidson pays a 100% tariff to Indian: since 2011 the company doesn’t import full motorcycles because it has a plant in this country where motorcycles are assembled not only for Indian but also the Asian market. Last January, in comments submitted to the Office of the United States Trade Representative, a lobbyist for Harley even warned that imposing additional tariffs on foreign imports could end up hurting sales. The issue of trade barriers through tariffs is extremely complex because the purpose of protecting a country is often due to differences between countries regarding for example pollution or safety matters.

36 Responses to “American Motorcycle Manufacturers Paying 100% Tariff Abroad. True Or False?”

  1. 1 Sharkey Mar 3rd, 2017 at 9:11 am

    Bilateral trade agreements allow for more specific tariffs, whereas most of these “free trade agreements” are a broad framework waiting to be used against you…

  2. 2 Janos Kafka Mar 3rd, 2017 at 9:28 am

    Look . When it comes to the ‘ so called ‘ president and his Breitbart , Bannon and Trump propaganda train all you need to remember is this ;

    Everything that comes out of his mouth will either be an outright lie , an exaggeration of the truth or half truth propagandizing all in quest for chaos and disorder so that in the end he might gain . Thus has it ever been since his entrance into the public eye back in the 70’s . Thus will it ever be till the end of his days . Period !

  3. 3 SO U NO Mar 3rd, 2017 at 10:54 am

    We the USA should be charging that same 100% tariff to a company called CSC Motorcycles in California for bringing in a bunch of POS’s Chinese motorcycles, they are helping make China great

  4. 4 Sam Mar 3rd, 2017 at 10:57 am

    To protect domestic jobs. If consumers buy less-expensive foreign goods, workers who produce that good domestically might lose their jobs.
    To protect infant industries. If a country wants to develop its own industry producing a particular good, it will use tariffs to make it more expensive for consumers to purchase the foreign version of that good. The hope is that they will buy the domestic version instead and help that industry grow.
    To retaliate against a trading partner. If one country doesn’t play by the trade rules both countries previously agreed on, the country that feels jilted might impose tariffs on its partner’s goods as a punishment. The higher price caused by the tariff should cause purchases to fall.
    To protect consumers. If a government thinks a foreign good might be harmful, it might implement a tariff to discourage consumers from buying it.

    hese are some of the reasons given for tariffs. The door swings both ways.

  5. 5 BobS Mar 3rd, 2017 at 11:04 am

    Tariffs are a tax on the middle class. Raising taxes on the middle class has a perfect record, 100% of the time it has failed to help grow the economy and has only hurt it.

  6. 6 Chief Waldo Mar 3rd, 2017 at 11:32 am

    Once again, a politician using BS to cloud over reality.

  7. 7 mkv Mar 3rd, 2017 at 1:50 pm

    Glad you posted this chart. Many companies like KTM, BMW and so on are have manufacturing plants over there because of this. India’s economy is booming because of BS like this. Can someone explain why we cant do this also???

  8. 8 James just another crazy kiwi Mar 3rd, 2017 at 2:02 pm

    We have no tarrifs against the USA all their goods can come in with no taxes or limitations.
    But as a farming nation the USA is afraid of us and limits and taxes us severly even though we are allies We have fought in many wars along side America. All the friends and allies rhetoric has always been lies.
    When your the little guy on the block you have to fight much harder.

  9. 9 Tom Ryan Mar 3rd, 2017 at 3:28 pm

    There’s only one way to find out if the tariffs in India are B.S. Has anyone following Cyril’s blog ever called a Harley dealership in India to find out the cost of a big twin and if the 100% tariff is true? And, what about the tariffs from the other countries?

  10. 10 Mar 3rd, 2017 at 4:13 pm

    Janos, Janos, Janos – get it right. Donald J Trump is not the “so-called” President of the United States. Hi is THE President of the United States, fairly elected and you disrespect your country and the office of the President with the “so-called”. Get over it. You and your snowflake buddies lost! Kennedy had many illicit affairs, this brother drowned a woman, Clinton, well what can we say that Monica did not. And then there was lying Hillary. Glass houses buddy, glass houses!

  11. 11 dan m Mar 3rd, 2017 at 8:50 pm

    BTW $1.1 bil is chump change a ” rounding error” Lets charge a trillion and see if mkts open to our products!

  12. 12 Pat h Mar 3rd, 2017 at 8:52 pm

    Right on Doc

  13. 13 dan m Mar 3rd, 2017 at 9:03 pm

    James just another Kiwi:
    Sir Our President has been clear. Its about us for a change. No more fighting and dying for Kuwait or the European Continent. We are determined, we are fair, but It’s about time we looked out for the Good ole USA. Sheep farmers in the USA get first call. God bless you, but….

  14. 14 RUB Mar 4th, 2017 at 12:52 am

    @ Janos , during Trump’s campaign , he was auctioning off red make America great hats . @ the bottom of the TV screen was a message , 100% of all proceeds go to the Fisher House . This is the kind of man our President is . A true American .

  15. 15 Brad Ervin Mar 4th, 2017 at 7:39 am

    Yeah, “everything” he says is a lie. Where was all this angst for truth when it was Clinton in the dock? But the election was so yesterday (unless you are living a fantasy about upending the unliked results).

    Thanks very much to Mr. Huze for actually doing homework on the issue. That’s a lot more helpful than vitriolic political harangues & presidential political hyperbolic exultations. And a hearty agreement that the issue isn’t so simple as “an eye for an eye.”

    At the beginning of our Country, tariffs were the national government’s only income. A lot has changed. Tariffs are sold as economic snake oil to ward off diabolical foreign adventurers that would otherwise lay waste to our industry and leave us all jobless, hungry and cold. But a tariff war may be the thing that began the Great Depression. Still, it’s interesting to note that the 100% tariff imposed by India got them a manufacturing plant where they didn’t have one before.

  16. 16 calif phil Mar 4th, 2017 at 8:46 am

    Well that chart tells me that my president is telling the truth. I am so glad we have a president that has the stones to fight for a better America. I know he loves our country and does indeed want to MAGA.

  17. 17 Jim Tom Mar 4th, 2017 at 8:50 am

    God bless America, God bless Donald Trump!

  18. 18 Mar 4th, 2017 at 10:15 am

    There is so much crap in the comments. For Mr. Kiwi.
    In fiscal year 2013, U.S. exports of agricultural and related products to New Zealand reached $432 million, while U.S. agricultural imports from New Zealand totaled $2.4 billion. Top U.S. agricultural exports include fresh fruit, dairy products, pet food, pork and prepared food. We are so afraid of their farming that we take a whipping in imports v. exports. LOL Mr. Trump…please fix this!

  19. 19 Charles Erickson Mar 4th, 2017 at 11:18 am

    Our so-called president is a liar, a pathological liar. That means that he is sick, and cannot really help himself. I am not enough of a Christian to feel sorry for him, though. And I really hope that he never mentions Harley-Davidson in a public setting again. I am on my fifth Harley, and if Trump gets his dirt on the brand, there won’t be a sixth.

  20. 20 SIGFREED Mar 4th, 2017 at 11:31 am

    On the dollar Doc Robinson.

    I loathe politics of all flavors – it is the stomping ground of the freeloaders and freaks. I think utopia is a place without ANY government.

    All emotions- and personal agenda’s aside (that almost always points to money) – I cannot see any conceivable rationale in anything but parity in tariffs between two countries. Eg if I pay a 20% tariff on your motorcycles then you pay 20% for mine.

    Granted it is never that simple, but it should at least be, as close as possible to a ZERO-SUM deal. Iow the bill for the tariffs/taxes should be (as a rounded figure) the same percentage of the total trade of each of the two countries. It should be audited retrospectively and adjusted annually to balance the previous year. Yes, it will mean the prices of imported goods may go up and down a bit each year, but that is the lesser of the evils.

    Eg if the Japanese want to sell motorcycles in the USA without significant tariffs – then they build them in the USA (or at least assemble it and produce a tangible portion of the parts in the States – eg 60%). It is not as if they have never done that before (eg the Goldwing). Eg if BMW, or Moto Guzzi, or Ducati wants to do the same – then they ‘build’ them in the States as well. If nothing else it will inject a bit of culture into US mechanics (only joking).

    On the flip-side of the same coin – US workers must then be globally competitive re. wages and productivity – the two go hand in hand.

    I do not care if Donald Trump, or Donald Duck is the president of the USA, I care about the USA. I am not a citizen – but the USA is the greatest place on earth and Donald Trump (with all his trivial faults) is getting bad press because he is fingering those who are hurting the USA. Irrespective if those villains are in the USA or outside of it.

    Europe is my place of origin and it is a political mess (and I am not saying it just because the ‘grass is always greener on the other side of the fence’). I say it because there is a segment of people in the USA who do not appreciate what they have and how fragile it is.

    Europe had a de facto civil war less little more than two generations ago – its scars are still there today. It is one of the fundamental reasons for the manic rage of “guilt” and the fact that the gates have been flung open for any- and all kinds of rubbish to enter and drag our civilization back to the Dark Ages. A civilization that has taken thousands of years to build and as much blood and sorrow. The Nazi’s took both my grandparents – so I know what extremists look like and it does not look like Donald Trump.

    Sure, Trump stretches the truth a bit, but who does not? Hillary? If I say “I have big balls” – there must be fifty ways to interpret it – your interpretation is not my problem. GROW UP…

    I have had my rant, but for G*D SAKE, this is a motorcycle site – please cut the politics out!

  21. 21 Nick Azoulay Mar 4th, 2017 at 1:06 pm

    Trump is vulgar, a sociopath, a demagogue, who is going to be impeached sooner or later. He is a political accident thanks to the Russians but will not stay in power a very long time.

  22. 22 Billy Trenz Mar 4th, 2017 at 1:12 pm

    Trump doesn’t love America. He loves only himself. He just wants power, make more money for himself and be loved! Sad individual.

  23. 23 brad ervin Mar 4th, 2017 at 2:11 pm

    A couple of quick notes no one will read. A tariff is an attack by one segment of a country against the rest of the people of that country in the name of xenophobia. The trade between countries is very complicated as pointed out by Mr. Huze. The relative price of a particular object made in different countries is distorted by the exchange mechanism which is driven by the total trade (including investments) between those countries. Fighting tariffs with tariffs merely shuts down trade between those countries.

    A tariff on a Camry may entice a buyer to look at a Cobalt and a tariff on Tacomas may entice a buyer to look at F-150s but a tariff on Ducatis probably won’t entice that buyer to look at Harleys. We, as riders, are much better off in a free market with the wide diversity that entails.

    After 8 yrs of it being treasonous to attack the U.S. President, childish & unfounded attacks seem to have attained the mark of high fashion.

  24. 24 5toedwillie Mar 4th, 2017 at 2:52 pm

    CYRIL When did you begin allowing all this political bullshit on you excellent blog, many of your readers are riders, builders, and motorcycle industry persons and as one of all of the above I have reduced reading your blog because of the increase of non-rider bs and the increase of verbal vomitus from non riders that have nothing better to do than spew their personal bias in places they think they are relevant.
    Please show some leadership and remove this irrelevant shit from the blog.
    Get back to your roots and your roots will get back to you. 5toed!!!!! PS until someone as a true rider has sacrificed a limb to their sport to save another, keep you bs to yourself.

  25. 25 Richard Lee Mar 4th, 2017 at 5:33 pm

    I think someone needs to look back at why Honda had to create the vf700 for the us but the 750 was available everywhere else!
    Why triumph and all other manufacturers had to change models to suit the inability of usa riders gear-changing to left foot change (I think that’s right) in a country that previously had both foot and hand change choices with left clutch right clutch foot clutch hand clutch??????????????

    Or could they just say take our Harleys but don’t send us you oil burner bikes as they wont pass emissions tests.

    Another view

    Im not sure how refined the india bullet models are but..
    The royal enfield constellation was so smooth a coin could be balanced on edge of a running engine.


    Can you balance a dollar bill flat on Harley?

  26. 26 Curtis Harrenstein Mar 4th, 2017 at 7:22 pm

    All the imposed tariffs you have listed are agriculture related, i.e.milk, tobacco, and cotton. The ag lobby in Washington is very strong, I think that they should give up some. I live in an ag state, and work in manufacturing.

  27. 27 Admin Mar 4th, 2017 at 9:22 pm

    Curtis. You are wrong. The tariffs listed are on uniquely on imported motorcycles.

  28. 28 BobS Mar 5th, 2017 at 9:33 am

    With regard to reciprocity and tariffs, we already know it doesn’t work. Again, what we have learned from our past but countries without such a long history of capitalism, like India, have yet to learn is that tariffs do not “level the playing field”. They burden through taxation your own consumers i.e middle class. India places a 100% tariff on motorcycles over 600cc’s. This does not protect Indian manufacturing because Indian manufacturing does not make big motorcycles, they make 500cc and smaller ones. This does not promote job growth in India because all the Indian consumers who would buy a Harley at half the price (no tariff) would create new jobs in dealerships, repair shops, shipping companies, clothing stores and all the adjacent business that goes along with a bunch of Harley riders. They also lose all the sales tax that comes with that economic growth in hopes of cashing in on a tariff that just gets circumnavigated like Harley and Indian motorcycle companies are doing with this. It’s a lose/lose situation. We in the US should not imitate lose/lose situations but continue the jobs and economic growth win/win situation we have established with low to no tariffs. Going backwards on this would be stupid.

  29. 29 huls Mar 6th, 2017 at 1:29 pm

    Hi The Netherlands here.
    Import tariff on bikes, wether new or used is negligable. However, the VAT is 21% over the bike’s price and cost of transport if you import one yourself. On top of that you pay 20% luxury tax which winds down to 0% if the bike is over 17.5 years old.
    All in all a good 40% that you need to pay on top of price of the bike and it doesn’t matter wether you call it a tariff or something else. I call it daylight robbery.

  30. 30 Mar 9th, 2017 at 11:38 am

    Having been the importer the Royal Endield for 18 years I can say that the current trade deal with India is ridiculous. We paid nothing – zero-nada duty to import bikes, parts and accessories from India. At the same time we paid ridiculous duty when we tried to export same. It is simply these countries preserving jobs in their country – why would’t we try to add jobs here in the US?

    I could have added 10 or more good paying jobs with benefits had I been able to sell my items in India where there is large demand for what I had. So how is that even reasonable?

    I also worked on importing the RE into Vietnam where the duty was 137%. I am no longer the importer of the RE and am bullish on the brand but it is only fair that whatever countries charge us duty should have an equal duty imposed on them. Watch their duty drop quickly.

  31. 31 Mar 10th, 2017 at 8:21 pm

    Hey Doc
    Being the all knowing guru on HD in Oz … what tariffs/taxes do aussie riders pay for HD’s?

  32. 32 Mar 13th, 2017 at 10:15 am

    Why not impose tariffs on the 52% of the parts the so-called American icon HaaRee Davasaan imports to make their “american” bike.
    everyone of those imported parts costs american jobs, but Willie G doesn’t lose any sleep worrying about them. At Harley sales volumns, they are one of the few companies that could afford true american craftsmanship and still make great profits, if they truely cared. Hell, I think Goldwings have more American parts than HD, and assembled here. No excuse Willie G, and how about that new line of manufactured in India bikes HD is dumping on you.

  33. 33 Mar 13th, 2017 at 10:19 am

    And, the tariffs are on the “COSTS” of the products imported, not the LISTED SALES price of the completed vehicle

  34. 34 Mar 14th, 2017 at 10:36 am

    It figures that a liberal like Janos would use this site to bash President Trump.. Trump has done more for the American people in one month than Obama did in 8 years. He has instilled confidence in the American economy, 3 Trillion dollars invested in American companies in one month. He is keeping jobs in the U.S. He is kicking out illegals that are criminals. Keeping out radical terrorists. Getting rid of Obama care. Cutting taxes. Getting rid of useless regulations. Just the beginning.
    What did Obama do. Told Russia, “Cut It Out”. What a joke. Iran, gave them Billions in “CASH”.
    They are still laughing at the U.S. For that one. And using the money to fight us. Plus not living up to
    The treaty that they signed. Good job Obama???? How about North Korea they fire off rockets like
    Every day is the 4th of July. What did Obama do???? NOTHING…When Carrier announced they were moving to Mexico Obama said in a speech “I don’t have a Magic Wand” Trump fixed it. Saved 1,000
    We could have elected Crooked Hillary?? She lied under oath to Congress. Had people working on her server that had no security clearance at all. The Foundation, what a joke, paid for her daughters
    Wedding. Took $10 million from a man with terrorists ties, also on a no fly list to the U.S. Wonder what he wanted??? Got one of the debate questions from another crook Donna Brazile, and told the woman from Flint Mi. We will fix the water problem in 30 days, and get rid of “All the lead pipe in the U,S.
    In ten years”. Anyone who has ever picked up a hammer knows it would take a lifetime to accomplish
    And cost TRILLIONS. Of dollars.
    Four different FBI locations are currently investigating Crooked Hillary. It has been said that her Foundation was as bad as the Bonano Crime Family. But, take comfort in knowing that if she should stay out of jail, if would be from a Pardon from President Trump….

  35. 35 Ray Maniford Mar 14th, 2017 at 11:04 am

    Ken. Stop listening to Fox (Faux) News and reading conspiracy fake news sites. All what you say is untrue.100 % BS that you believe and made you vote for a total incompetent who doesn’t understand anything about the world and politics.

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