
Motorcycle tariffs, here we go again! Do you remember 1983 when President Ronald Reagan significantly increased tariffs on imported motorcycles with engines over 700 cc displacement? How about 2025 when resident Ronald Reagan significantly increased tariffs on imported motorcycles, parts, accessories and gear built outside the USA? Or Prime minister Justin Trudeau countered with tariff’s on motorcycles and billions world of goods from the USA within days of that announcement? Or Mexican President Claudia Sheinbaum implemented a blanket counter tariffs on U.S. goods? Then China announced a 25% tariff on billions worth of American goods.
Canada’s countermeasures include calling out motorcycles specifically: “Imposing tariffs on billions in goods imported from the U.S., effective February 4, 2025, when the U.S tariffs are applied. The list includes products such as orange juice, peanut butter, wine, spirits, beer, coffee, appliances, apparel, footwear, motorcycles, cosmetics, and pulp and paper.”
I hate to lead the witness here, but does this sound like motorcycle prices are going to you?
Going back to the 80’s, those Ronald Reagan imported motorcycle tariffs started at 49.4%. Today were are talking 25%, which on the surface sounds like a deal vs 49.4%, but we have much greater, broader and more diverse global supply chains and financial markets. Its rare to find motorcycles built entirely in any one country completely anymore and if so, it’s not the major manufacturers like Harley-Davidson, Indian Motorcycle, Hhonda, Suzuki, Yamaha, Ducati, Moto Guzzi, Aprilia, BMW, or Kawasaki.
Due to the complexity of this question I asked ChatGPT:
Most of these motorcycle brands have manufacturing facilities in multiple countries, so they aren’t built entirely in their home countries. Here’s a brief overview:
Honda: Manufactures motorcycles and automobiles in various countries, including Japan, the United States, China, and India.
Suzuki: Has production plants in Japan, China, India, Pakistan, and several other countries.
Yamaha: Operates manufacturing facilities in Japan, Taiwan, China, and other locations around the world.
Ducati: Primarily manufactures in Italy, but also has facilities in other countries.
Moto Guzzi: Mainly produces motorcycles in Italy.
Aprilia: Produces motorcycles in Italy and other countries.
BMW: Manufactures motorcycles and automobiles in Germany and other countries.
Kawasaki: Has production plants in Japan and other countries.
So, while some brands like Moto Guzzi and Aprilia have a strong presence in their home countries, most of these companies have a global manufacturing footprint. Also many motorcycles go back-and-forth across a tariff border many times before completion greatly increasing the tariffs from 25% one time across to 56% for 2 or even 95% with 3 times crossing.
Now unlike the 1980’s motorcycle tariff’s, this isn’t a USA only price impact issue. This is a global economic trade war and the odds of it impacting everyone in every country when it comes to motorcycles is very high. “Global trade dynamics can indeed be quite volatile, and tensions between major economies can easily escalate. The ripple effects of tariffs and counter-tariffs can impact not just the countries directly involved but also global supply chains and economies worldwide.”
I guarantee companies will be affected so will factories and worker jobs in the motorbike industry. Already KTM is in trouble, so is Ducati with the VW Group and MV Agusta had to financially re-organize. This sadly will mean the death of some motorcycle brands and other motorcycle brands not available in Countries they can’t sell their bikes in due to increased tariffs. It’s just a fact of business.
You will have specific actions against other countries actions and it’s SAD DAY for motorcyclists and riders worldwide because these actions will have a DIRECT IMPACT on every aspect of motorcycling even if you buy used, have a bike or just work on your bike. Parts, accessories, tires, jackets, helmets, gloves, tools, oil even a little $1 rubber gasket or light bulb. It’s simply going to be affected by either price, availability or supply.
We all learned the hard way 5 years ago starting in 2020 how supply chains work and inflation of food, living expenses and even toilet paper availability greatly impacted us all.
Some Countries will win this and lose that, who wins overall, the consumer. I can’t say as business are in business for profits, not losses.
Motorcycle Tariff’s – Here we go again! Two-Wheeled Trouble: Motorcycle Prices to Spike with New Tariffs… but this time it isn’t over a 700cc or 750cc engine size or saving AMF Harley-Davidson, it’s over economic sovereignty and that’s not easy to fix.
So how did the motorcycle tariff’s from 1983 eventually play out when they where lifted you ask?
“Motorcycle buyers eventually paid more for all brands. The U.S. agreed to devalue the dollar against the Japanese yen in 1985, as that situation had been hurting many American businesses. Japanese bike prices rose as a consequence, while improving demand enabled Harley to raise its prices, too. The numbers that most people really missed? The lower prices of those over-produced 1980s models.”
Want to read more? I have 3 more articles on just this topic recently, plus a shortened article from Hagerty below. Enjoy!
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Total Motorcycle Year End Review: Riding into 2025!
Unleash the Thrills: First 2025 Harley-Davidson Bikes Roar onto the Scene!
A word pulled from today’s news gives the short answer: tariffs. In a bid to help struggling Harley-Davidson recover from a near-death spiral 36 years ago, the federal government imposed steep tariffs on imported motorcycles with 700 cc and larger engines. Sales volume thresholds built into the tariff action essentially exempted lower-volume European bikes, making the tariff’s real targets crystal clear: Honda, Kawasaki, Suzuki, and Yamaha.
While Japan’s government was protesting the American move, its motorcycle makers were busy dropping shorter-stroke crankshafts into their 750s to bring them under the 700-cc tariff cutoff. (In the case of the 78-hp 1983 Kawasaki KZ750, a slight bore shrinkage dropped its 738-cc engine to 694 cc to become the 74-hp KZ700 in 1984.) Tweaks such as revised cam timing, higher compression, and revised gearing kept performance close to the 750s that they temporarily replaced.
On April 2, 1983, President Ronald Reagan signed an action that significantly increased tariffs on imported motorcycles with engines over 700 cc displacement. Effective that month, the 4.4-percent rate then in place rose to 49.4 percent but was set to decline each year afterward: 39.4 percent in the second year, 24.4 percent in the third, 19.4 in the fourth, 14.4 in the fifth and then back to the original 4.4.
In 2009, the Japan-based Research Institute of Economy, Trade and Industry looked back on the motorcycle tariffs and concluded that it was Harley’s own initiatives that boosted sales and saved the company—not the tariffs.
“This is primarily because consumers perceived that Harley-Davidson and Japanese large motorcycles were poorly matched substitutes for each other,” the report stated.
Having the tariff in place, however, might have comforted Harley’s lenders. And, when Harley petitioned the government to end the higher tariffs one year early, it was not a magnanimous gesture toward the Japanese brands but more of a signal to the market that America’s bike maker no longer needed government help.
Motorcycle buyers eventually paid more for all brands. The U.S. agreed to devalue the dollar against the Japanese yen in 1985, as that situation had been hurting many American businesses. Japanese bike prices rose as a consequence, while improving demand enabled Harley to raise its prices, too.
The numbers that most people really missed? The lower prices of those over-produced 1980s models.
https://www.hagerty.com/media/automotive-history/when-uncle-sam-targeted-import-bikes-to-save-harley-davidson/