HARLEY-Davidson says profit margins will be 9-10% this year, compared with 20% a year ago, as trade tariffs bite.

However, the US motorcycle maker's most recent quarterly performance beat estimates after sales outside the US rose by 2.4% to 29,546.

The company was singled out by the EU for tariffs in response to action by President Donald Trump against certain European exports to the US.

It says it will move some production out of the US to get round these.

Total sales for the three months to the start of July were 72,593, down 11.3% from last year.

Net income was $248.3m (£189.11m), down from $258.9m in the same quarter a year earlier.

The company has assembly plants in Australia, Brazil, India and Thailand as well as in the US.

It said it would raise investment in its international plants, though it has not said which ones.

Harley-Davidson said last month that the EU's tariffs would add, on average, $2,200 (£1,660) to each bike exported to Europe from the US as the import tax increases from 6% to 31%.

Mr Trump has said tariffs on steel and aluminium imports, which came into force last month, are necessary to protect the US steel and aluminium industries, which he maintains are vital to national security.

They have drawn retaliation from the EU, Canada, Mexico, India and others while driving up the cost of metals for manufacturers in the US.