Trump threatens Harley-Davidson with 'big tax' if it relocates plants overseas

US President Donald Trump accused Harley-Davidson of using the recently imposed EU tariffs on automobile imports to Europe as an excuse to shift motorcycle production abroad and threatened a new tax on imports if relocation goes ahead.

The manufacturer said on Monday it was considering moving some of its production overseas since exporting bikes from the US to Europe under new trade tariff would ramp up the costs by $2,200 per bike.

Trump tweeted on Tuesday: "A Harley-Davidson should never be built in another country - never! Their employees and customers are already very angry at them. If they move, watch, it will be the beginning of the end - they surrendered, they quit! The Aura will be gone and they will be taxed like never before!"

"Early this year Harley-Davidson said they would move much of their plant operations in Kansas City to Thailand. That was long before Tariffs were announced. Hence, they were just using Tariffs/Trade War as an excuse. Shows how unbalanced & unfair trade is, but we will fix it," President Trump said in another tweet.

The President said that he would be prepared to fight hard on behalf of Harley-Davidson and other companies hit by tariffs levied in retaliation to tariffs imposed by the White House, but urged patience and not use the tariffs as an excuse to move production.

He said he was “opening up closed markets” with his new tariff system. He has also threatened to impose 20% tariffs on EU cars after the bloc responded with retaliatory tariffs.

Harley shares fell 1.3% in early trading Tuesday in New York after tumbling 6% Monday. The stock is down 18% this year.