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After putting Wisconsin on notice that it was shopping around for other places to build its motorcycles, Harley-Davdison has reached a tentative agreement with local labor unions that would keep the Bar and Shield brand in The Cheese State. Harley and union officials have not disclosed the terms of the deal, but both the Harley-Davidson and International Association of Machinists and Aerospace Workers are recommending approval of the deal. The terms of the deal are expected to be released next week, so union members can vote on the contract on September 13th.

In about 18 months, roughly a thousand workers will be out of a job at the Polaris plant in Osceola, Wisconsin. In that timeframe Polaris plans to close the Osceola plant, and move its production south of the border to Mexico. The move comes about as Polaris looks to increase production efficiency (i.e. lower production costs with cheaper labor), which will then allow the company to be more competitive with its products’ positions in their respective marketplaces.

Harley-Davidson is looking to slash costs wherever they may be, and that includes its assembly/manufacturing line labor costs. HD and Milwaukee go together like peas and carrots, but Harley-Davidson has warned that if it doesn’t see lowering labor costs, it could walk away from Wisconsin all-together. At issue is nearlt $54 million in what Harley calls “costs gaps”, which the company attributes to the high cost of manufacturing at its Menomonee Falls and Tomahawk facilities.