AMERICAN companies “will react and they will put pressure on the American administration to say, ‘Hey, hold on a minute. This is not good for the American economy.’” So said Cecilia Malmström, the European Union’s trade commissioner, on news that Harley-Davidson plans to move some production out of America to avoid tariffs imposed by the EU on motorcycles imported from America. Those tariffs had themselves been introduced in retaliation for American duties on steel and aluminium imports.
President Donald Trump showed no signs of absorbing this salutary lesson. In one of many splenetic tweets about Harley, he said: “If they move, watch, it will be the beginning of the end.” Other American firms are no doubt watching. Will any follow?
Harley is unusually vulnerable to Mr Trump’s escalating trade war. Not only have its inputs, namely metals, risen in price, but it makes a fair chunk of its sales, 16%, in Europe. It puts the cost of…
