Could President Trump’s Tariffs End Up Doing More Harm Than Good?

1 2 3 4
Part 4
Could President Trump’s Tariffs End Up Doing More Harm Than Good? PART 4 OF 4

President Trump, Section 232, and Harley-Davidson


President Trump has frequently lashed out against trade partners such as China and India, and his administration is trying to renegotiate NAFTA (North American Free Trade Agreement).

President Trump, Section 232, and Harley-Davidson

Interested in HOG? Don't miss the next report.

Receive e-mail alerts for new research on HOG

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

Trump has referred to Harley-Davidson (HOG) a couple of times when pointing out how US companies pay higher tariffs overseas. According to Trump, Harley-Davidson pays a high tariff in India, but Indian motorcycles have no duty in the United States. While there is some merit in Trump’s reciprocal trade analogy, Harley-Davidson could also feel the negative effects of the Section 232 tariffs.

Higher costs

According to Wedbush Securities, Trump’s tariffs on steel and aluminum imports could increase Harley-Davidson’s costs by $30 million. The company has already been facing margin pressure, as you can see in the above graph. It’s also worth noting that Europe has already threatened retaliation against some American brands. Among them is Harley-Davidson, which was mentioned as a possible brand where Europe can hit the United States (IWM).

To sum it up, the US steel industry has reason to celebrate after the steel tariffs since they could see a spike in earnings with higher steel prices. However, there could be some economic costs for US consumers if companies pass on higher costs to protect their margins.


On the jobs front, it remains to be seen how many new jobs will be created due to the tariffs. While U.S. Steel Corporation (X) has announced a plant restart, some of the downstream companies are rethinking their plans. For instance, Electrolux has already delayed its $250 million investment after Trump announced the steel and aluminum tariffs.


Please select a profession that best describes you: