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U.S. tariff threat hits European automakers' stocks

FRANKFURT, Germany — A U.S. warning that it may introduce tariffs on foreign auto imports hit shares in German carmakers BMW, Daimler and Volkswagen on Thursday, which together have a more than 90 percent share of North America's premium car market. Washington said on Wednesday it had launched an investigation into whether car and truck imports are a national security issue due to signs they had damaged the U.S. auto industry. That could lead to new U.S. tariffs — up to 25 percent — similar to those imposed on imported steel and aluminum in March. BMW and Daimler shares fell as much as 3.1 percent in early Thursday trading, while Volkswagen's dropped as much as 2.5 percent. "(U.S. President) Donald Trump is obviously not thinking about how to prevent a trade war. Import duties on cars would be a nightmare for the German auto industry and would lead to a massive sales impact," said Thomas Altmann at Frankfurt-based asset manager QC Partners. BMW on Thursday condemned the move to consider tariffs. "The BMW Group is committed to free trade worldwide. Barrier-free access to markets is therefore a key factor not only for our business model, but also for growth welfare and employment throughout the global economy," it said. Daimler, which makes Mercedes-Benz cars, and Volkswagen, which makes upmarket Audis and Porsches, were not immediately available for comment. German carmakers produced 804,000 cars at local factories in the United States and exported 657,000 German-made cars into North America last year, according to German auto industry association VDA. China took pains on Thursday to welcome German firms and investments, with Premier Li Keqiang talking up relations after a meeting with German Chancellor Angela Merkel. BMW and Mercedes have expanded production capacity in the United States, but BMW, Audi, Volkswagen and Daimler have also invested billions to build new factories in Mexico in the hope of selling locally produced cars into the United States. German carmakers hiked vehicle production in Mexico by 46 percent to 620,000 cars last year, while production levels inside the United States fell by 6 percent to 804,000 cars because of a shift to Mexico, according to the VDA. BMW has its biggest factory worldwide in Spartanburg, South Carolina, and is the largest vehicle exporter among all the carmakers in the United States measured by value of goods exported. More than 70 percent of BMW's U.S.-made cars are exported.

Audi S1 officially shows itself as 228-hp hot hatch [w/video]

We got the first leaked pics of the new Audi S1 Sportback five-door hot hatch yesterday, and as expected, Audi has unloaded the full details today, including confirmation of its S1 three-door sibling ahead of its debut at next month's Geneva Motor Show. The two cars are essentially identical aside from their door counts, and together, they represent a new entry-level rung into Audi's S car range.
The subcompact S1 is propelled by Audi's ubiquitous 2.0 TFSI four-cylinder, tuned here to produce 228 horsepower and 279 pound-feet with a six-speed manual transmission and all-wheel drive. The potent combo accelerates the S1 to 62 miles per hour in 5.8 seconds (5.9 seconds for the Sportback) and on to a top speed of 155 mph. Fuel economy is rated at an average 33.6 miles per gallon (40.3 mpg UK) in the UK cycle. The S also gets a completely different four-link independent suspension to replace the less sophisticated torsion beam setup found in the standard A1.
Styling also gets a bump in aggressiveness that befit the S1's performance upgrades. In addition to a new body kit with a lower front air dam and 17-inch wheels, the S1 comes standard with Xenon headlights, LED taillights and two new available exterior colors ­- Vegas Yellow and Sepang Blue. The interior gets combination leather and cloth sport seats, piano black trim and a retractable 6.5-inch color infotainment display.

Next Audi RS4 to get V6 turbo, US sales still unclear

Audi's high-performance S models have forged a reputation in the US for offering wonderful driving dynamics in a package that doesn't scream, "I bought a sport sedan." However, its even higher-performance RS models are still somewhat of a rarity here. While the RS5 and RS7 are in the current US lineup, many of the wild RS models that Europe gets, like the RS6 Avant (pictured above), never make it to these shores. Unfortunately, that might not be changing anytime soon with the next-gen RS4.
The RS4 will follow the lead of the next BMW M3/M4 and (rumored) next Mercedes-Benz C-Class AMG and make the switch to a smaller turbocharged powerplant. According to an Audi insider speaking to Car and Driver, the next RS4 will drop the last generation's 4.2-liter V8 in favor of a turbocharged V6. The engine block will likely be shared with the supercharged 3.0-liter V6 in the regular S4 but fitted with two turbochargers. Power would likely be around 400 horsepower to match the 425-hp M3 and rumored 450-hp C-Class AMG.
Unfortunately, the RS might not make it across the pond to our waiting hands because the source says no decision has been made to export them yet. Obviously, we hope that Audi makes the right decision and brings the next RS4 here.