Harley-Davidson Canada sales hit by 50% U.S. Motorcycle
A 50% Canadian tariff on U.S.-built motorcycles over 800cc, in effect since September 2025, is pressuring Harley-Davidson sales and dealer profits.
Canada's 50% retaliatory tariff on U.S.-built motorcycles with engines over 800cc is reshaping the market. The duty, which took effect at 12:01 a.m. On September 8, 2025, applies to the customs value of imported bikes. It covers nearly the entire Harley-Davidson range and most Indian Motorcycle models. This measure was part of a broader package of Canadian countermeasures covering $27.6 billion of American goods, with motorcycles receiving the top rate.
Dealer perspective from Regina
Robb Hertzog, co-owner of Prairie Harley-Davidson in Regina, Saskatchewan, says his dealership has no alternative to U.S.-built motorcycles. He now orders from the U.S. Again and expects almost every bike he imports to carry the new 50% duty. Hertzog predicted the tariffs would affect everything the dealership brings in.
Sales trends and financial pressure
Harley-Davidson sold 6,434 motorcycles in Canada during 2025. That figure accounted for nearly five percent of its global retail sales. The market has since softened. Canadian retail slipped to 3,735 units in the first half of 2026 from 3,912 a year earlier. The financial impact of the tariff is severe. Absorbing the duty across a full year of Canadian sales would result in a bill of about $68.7 million. That sum exceeds the top end of Harley's projected operating income for its motor company in 2026, which it guides between $10 million and $50 million.
Cost absorption and pricing uncertainty
It remains unclear who will bear the tariff cost. Manufacturers, distributors, and dealers can choose how much of the additional expense to absorb. Hertzog warned that motorcycle prices in Canada could double. The math is daunting. The duty works out to approximately $10,675 on a Harley at the company's 2025 average wholesale price. For context, Harley-Davidson's motor company kept roughly $5,171 of gross profit on that same bike in 2025. The duty alone is more than double that profit margin. Hertzog stated that tariffs hurt the imposing country more than the target nation, adding that businesses must hold their ground cautiously.
Reporting this week indicates Canada represents about four percent of Harley's roughly $4.5 billion in annual revenue. Looking ahead, Harley-Davidson expects its York, Pennsylvania plant to build more than 100,000 motorcycles in 2027. This is part of its plan to reshuffle North American production ahead of the 2028 model year.
