Harley Davidson Used The Trump Tax Cut To Fire Workers And Reward Shareholders

Official White House Photo by Shealah Craighead/Public Domain

Harley-Davidson is shutting its plant in Kansas City, Missouri - costing 800 people their jobs - and buying back stock.

Both House Speaker Paul Ryan and President Donald Trump touted their planned tax cuts last year as a move that would encourage Harley-Davidson – as well as other American companies – to boost jobs and manufacturing in the United States, bringing good-paying jobs back to the U.S.

Ryan told an audience at a Wisconsin Harley-Davidson plant last September that the pending tax bill would “put American manufacturers and American companies like Harley-Davidson on a much better footing to compete in the global economy and keep jobs here in America”.

But it turned out that Harley-Davidson had something else in mind: shutting down one of their plants and rewarding their shareholders.

Four months later and 500 miles away in Kansas City, Missouri, 800 workers at a Harley-Davidson factory were told they would lose their jobs when the plant closed its doors and shifted operations to a facility in York, Pennsylvania — a net loss of 350 jobs. Workers and union representatives say they didn’t see it coming.

Then, adding insult to injury, the company announced just days later a plan to buy back 15 million of its shares – a value of about $696 million.

Harley-Davidson’s plan to close down its Kansas City plant by 2019 and move operations to Pennsylvania will churn out a net loss of 350 jobs – and not all of the 450 positions coming to York will be full-time.

Greg Tate, a staff representative for the United Steelworkers District 11, said the move itself will save Harley money:

The median household income in York is much lower than in Kansas City, and Tate said that hiring a casual workforce there — temporary workers brought in to boost production during peak season — will be easier and cheaper for Harley.

In the meantime, the company is rewarding shareholders and appears to have no plans to change course:

On a call discussing the company’s first-quarter results in April, chief financial officer John Olin indicated that shareholder primacy will continue. “Beyond what we invest in the business, we will return and continue to return all excess cash to our shareholders,” he said. The company this year shut the media out of its annual shareholders meeting.

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