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No extra European import taxes on US motorcycles (yet)

The European Union has decided to extend the suspension of its rebalancing tariffs on US products, such as Harley-Davidson motorcycles.

In 2018, the then president Trump signed two proclamations to impose additional duties of 10% and 25% respectively on certain imports of aluminium and steel products into the United States, introducing tariffs on €6.4 billion of European steel and aluminium exports. These measures followed investigations carried out by the US Department of Commerce, which concluded that imports of these products threatened US national security and recommended action to restrict imports.

In response, the European Union introduced rebalancing tariffs on US exports to the EU of a value of €2.8 billion; this included import tariffs for US products such as Harley-Davidson motorcycles, making these motorcycles much more expensive for European consumers.

FEMA has repeatedly contacted the European Commission, explaining that imposing sanctions or import taxes on Harley-Davidsons will not just hurt Americans and American industry, it will also hurt European motorcycle businesses, their workers and the families of those workers. People could lose their jobs and families could lose their income if motorcycles like Harley-Davidsons become too expensive to sell. The motorcycle community is a global community and needs free trade and free movement of people and goods. We do not need to be involved in fights between governmental bodies.

‘Motorcycles have no place in this dispute over steel and aluminium.’

In 2022, the EU suspended these measures fully until 31 December 2023 to provide time to work together on a longer-term solution. The US replaced the US Section 232 tariffs with a tariff-based quota system based on historical trade volumes, resulting in above-quota EU steel and aluminium still being subject to tariffs.

The European Union has now announced its decision to extend the suspension of its rebalancing tariffs on US products in the context of the steel and aluminium dispute until 31 March 2025. This extension is the result of an agreement reached with the US.

Antonio Perlot, Secretary General at ACEM, the European association of motorcycle manufacturers, said: “This positive development is highly welcome. As nobody wins in trade wars, the motorcycle industry in Europe continues supporting the EU and the US putting an end to this long-standing dispute.

The EU prolongs the suspension of rebalancing tariffs in return for the US extending the suspension of its tariffs for historical trade volumes. In addition, the US agreed to provide for further exclusions from the tariffs for EU exporters. The European Commission thinks that this extension will result in EU steel and aluminium exporters saving approximately €1.5 billion in tariffs annually.

Jane Stevenson, Harley-Davidson‘s Director Global Government Affairs, said: “Harley-Davidson is extremely pleased to see the EU extend their suspension of tariffs on our motorcycles. However, a permanent resolution is still needed. Our business has suffered as collateral damage in this dispute since 2018, and it continues to hang over us into 2025. Motorcycles have no place in this dispute over steel and aluminium. We remain extremely concerned that a resolution will not be found to this dispute by 31st March 2025 due to the EU and US elections.

Written by Wim Taal

Source: European Commission

Top photograph courtesy of Harley-Davidson (flag by Carsten Reisinger)