Harley Davidson on Overseas Production

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Name:
Date:

Question 1

 The whole issue of Harley Davidson is directly related to issues on cash flow,
financial planning, and forecasting.
 The increase of tariffs on imported goods from the United States from 6 percent to 31
percent affects cash flow to the company hence incomes and the ability of the
company to realize its goals and maybe even to continue production (CNBC LLC).
 The issue is related to financial planning because it interferes with the company's
current incomes and future planning which predicts incomes, the assets and growth
rates. The increase in tariffs have the potential to affect the cost of their products
which may affect its competitive edge in the market making it hard to achieve its
goals.
 The issue would also affect forecasting in the business due to its impact on budgeting
and the laid out future plans. The tariffs may create more financial problems in the
business making it hard to come up with a future plan that will place it in the same or a
better place.

Question 2

 The company's gross margin will be greatly affected if the company is not able to
create a smooth transition.

Surname 2
 This is because the transition may pose various challenges which include the transfer
of jobs from one market to the other which might also be a problem in the new country
they are seeking to base their operations.
 Other factors such as the cost of raw materials in the new country of production may
also affect the gross profit margins hence make it even harder for the company to
continue on its operations.

Question 3

 I would suggest two options here. First, the company or the American government
should consider negotiating the increase in the terms so as to avoid further problems.
They can agree on a suitable increase in tariffs that will not harm companies from the
two regions in any way.
 Second, if the first solution does not work the company can proceed with its plans of
shifting operations to other countries preferably those under the European Union.
However, as indicated above, this should be done with a lot of care while considering
all factors and any financial implication that may arise. The company should negotiate
concerning issues such as moving labor from the United States to the countries and
reach an understanding to reduce suffering from other severe political issues.

Surname 3

Works Cited

CNBC LLC. Harley-Davidson to move some production out of the US to avoid EU
tariffs. 25 June 2018. 18 February 2019. <https://www.cnbc.com/2018/06/25/harley-
davidson-says-it-will-not-raise-prices-to-cover-eu-tariff-cost.html>.