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Japan may aid carmakers facing U.S. tariff threat

TOKYO — Japan is considering giving carmakers fiscal support including tax breaks to offset the impact from trade frictions with the United States and a sales-tax hike planned for next year, government sources told Reuters on Wednesday. Going into a second round of trade talks with the United States on Sept. 21, Japan is hoping to avert steep tariffs on its car exports and fend off U.S. demands for a bilateral free trade agreement that could put it under pressure to open politically sensitive markets, like agriculture. "If the trade talks pile pressure on Japan's car exports, we would need to consider measures to support the auto industry," a ruling party official said on condition of anonymity because of sensitivity of the matter. The auto industry accounts for about 20 percent of Japan's overall output and around 60-70 percent of the country's trade surplus with the United States, making it vulnerable to U.S. action against Japanese exports. Japan's biggest automakers and components suppliers fear they could take a significant hit if Washington follows through on proposals to hike tariffs on autos and auto parts to 25 percent. Policymakers also worry that an increase in the sales tax from 8 percent to 10 percent planned for October 2019, could cause a slump in sales of big-ticket items such as cars and home. Prime Minister Shinzo Abe has twice postponed the tax hike after the last increase from 5 percent in 2014 dealt a blow to private consumption, which accounts for about 60 percent of the economy. To prevent a pullback in demand after the tax hike, the government may consider large fiscal spending later when it draws up its budget for next year, government sources said. "One option may be to greatly reduce or abolish the automobile purchase tax," one of the government sources said. The government is also considering cuts in the automobile tax and automobile weight tax to help car buyers, the source added. Reporting by Izumi Nakagawa and Tetsushi KajimotoRelated Video: Image Credit: Getty Government/Legal Isuzu Mazda Mitsubishi Nissan Subaru Suzuki Toyota Trump Trump tariffs trade

Revisit the charms of the 1978 Subaru Brat

The Subaru Brat is the automotive equivalent of a teenager with a mullet: weird, a little reckless but brimming with enough self-confidence to make it cool.
The Brat came from Subaru's desire to compete in the burgeoning light pickup market of the late-1970s. To get around the so-called Chicken Tax that added a 25 percent tariff on imported pickup trucks, Subaru threw two seats in the bed, which technically allowed it to be classified it as a passenger car. The result was a great, weird combination of a complete lack of safety, with a low price and lots of driving fun.
In the video below, Motor Trend's Johnny Lieberman takes a 1978 Brat through the desert and shows just how much fun a little pickup can be.

2015 Subaru WRX STI goes for the gold [w/video]

If the all-new 2015 Subaru WRX has taken a good thing and made it great, then this should be, well, greater. Meet the range-topping WRX STI, packing more power, a decidedly more aggressive suspension tune, beefier looks, a giant wing and (woo!) gold wheels.
Those spiffy BBS wheels and WRC rally-ready matching WR Blue paint won't necessarily be around forever, though - Subaru is offering this package (along with unique interior trim) on the STI Launch Edition, limited to just 1,000 units. And cool as it may look, there's far more to love about the new STI package.
Power comes from a 2.5-liter turbocharged boxer four-cylinder engine, sending 305 horsepower and 290 pound-feet of torque to all four wheels via a six-speed manual transmission. (Launch Edition models even get a short-throw shift kit, which will likely be available as a dealer-installed accessory thereafter). Unlike the standard WRX, a do-it-yourself 'box will be the only transmission available. Subaru is employing its new - *ahem* - Multi-Mode Driver Controlled Center Differential version of the Symmetrical All-Wheel Drive, which, in addition to a standard 41/59 torque split, uses things like torque vectoring, and, when put in manual mode, allows the driver to select one of six center differential locking levels. In other words, the STI should be incredibly sharp on the road - sharper than ever before.