The Harley-Davidson brand has long symbolized American craftsmanship and freedom on the open road. But in 2025, the company finds itself at the center of a global trade storm, as the European Union’s retaliatory 50% tariff on U.S.-made motorcycles has produced unexpected consequences. Instead of simply protecting European manufacturers, the tariff has fueled a gray market for Harley-Davidson bikes, forced dramatic changes in production strategy, and raised urgent questions about the future of U.S. motorcycle exports and American jobs.
The roots of this trade conflict stretch back to earlier U.S. tariffs on European steel and aluminum. In response, the EU imposed a 25% duty on American motorcycles in 2018, a move that Harley-Davidson initially absorbed rather than passing on to European customers. In April 2025, the EU escalated its response, announcing a 50% tariff on U.S.-made motorcycles, plus a 6% base import duty-bringing the total to a staggering 56% for Harley-Davidson and Indian bikes entering Europe (British Motorcyclists Federation, BizJournals).
This move was intended to pressure the U.S. into rolling back its own tariffs, but it also dramatically increased the cost of Harleys in Europe. For example, a Harley-Davidson Road Glide that retails for $28,000 in the U.S. now costs as much as $124,000 in Denmark once all taxes and tariffs are included (MoneyControl, SAN News).
Facing the prospect of being priced out of its second-largest market, Harley-Davidson made a bold move: it shifted production of EU-bound motorcycles from U.S. plants to overseas factories, notably in Thailand (CBS News). This allowed Harley to temporarily avoid the steepest tariffs, as Thailand-assembled bikes were initially subject to a much lower EU import duty.
However, the EU closed this loophole in 2021, applying the same 25% (and now 50%) tariff to all Harley-Davidsons, regardless of where they were assembled, if the company was deemed to be circumventing the rules (BizJournals). The European Court of Justice upheld this decision in late 2024, ending Harley’s ability to sidestep the tariff through Thai production.
Harley’s overseas shift had a direct impact on American workers. The company closed its Kansas City, Missouri, assembly plant in 2019, citing the need to streamline operations and offset tariff costs. While some jobs were added in York, Pennsylvania, the net result was a loss of hundreds of U.S. manufacturing jobs (Retail Dive).
Harley’s leadership has been vocal about the paradox: tariffs meant to protect American jobs instead incentivized moving production abroad, hurting U.S. workers and failing to shield the company from global competition.
With official Harley-Davidson prices in Europe skyrocketing, a thriving gray market has developed. European enthusiasts and dealers are increasingly sourcing U.S.-spec Harleys through alternative channels:
Parallel Imports: Buyers import bikes directly from the U.S. or non-EU markets, sometimes disassembling and reassembling them to avoid classification as “new” vehicles.
Used Bike Boom: Demand for pre-owned Harleys has soared, as these bikes can sometimes be imported at lower duty rates or through legal loopholes.
Parts and Kit Imports: Some importers bring in motorcycles as parts or kits, then assemble them locally, sidestepping the highest tariffs.
This gray market activity not only undermines the intended effect of the tariffs but also complicates warranty, compliance, and safety standards for European riders.
Europe remains Harley-Davidson’s second-largest market, with over 25,000 new registrations in 2024 alone (BizJournals). The 50% tariff has dramatically reduced the competitiveness of American-made motorcycles, while also raising the cost of production materials due to U.S. tariffs on imported steel and aluminum.
Harley-Davidson’s leadership has called for reciprocal duties on foreign motorcycle brands, arguing that European competitors face only a 2.4% tariff when entering the U.S. market (MoneyControl). This imbalance, they argue, distorts the global marketplace and puts American manufacturers at a disadvantage.
For U.S. exporters, European dealers, and collectors, the Harley-Davidson tariff saga offers several key takeaways:
Monitor Policy Changes: The tariff landscape is volatile. Staying informed about new duties, exemptions, and legal rulings is crucial for planning shipments and purchases.
Consider Alternative Shipping Strategies: Utilizing bonded storage or free ports in non-EU countries can sometimes defer or reduce tariff exposure.
Leverage Classic Exemptions: As with the 25-year exemption for classic cars and motorcycles, older Harleys may qualify for lower duty rates.
Work with Experienced Shippers: Navigating the gray market and compliance landscape requires expertise. Our motorcycle tariff pillar guide covers best practices for legal, cost-effective transatlantic motorcycle shipping.
The EU’s 50% tariff on Harley-Davidson motorcycles was intended as a show of strength in a global trade dispute. Instead, it has fueled a gray market, incentivized overseas production, and cost U.S. manufacturing jobs-while doing little to protect European brands from competition. For collectors, dealers, and logistics professionals, the Harley-Davidson paradox is a cautionary tale about the complexities of international trade in a tariff-heavy world.
Contact West Coast Shipping for up-to-date compliance strategies and seamless logistics.