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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

2015 Subaru Outback

"We like producing cars that are different." That's the company line trumpeted by several Subaru executives during the launch of the 2015 Outback - one of Fuji Heavy's most successful vehicles to date. Managing Editor Jeremy Korzeniewski accurately noted that while Subaru has never really found salvation with its mainstream sedans, it's the higher-riding, butcher offerings like the Outback and the Impreza-based XV Crosstrek that have been sales stars for the Japanese company. In 2013, for example, Subaru sold nearly three Outbacks for every Legacy it moved. And in 2014, the XV is on pace to outsell the Impreza upon which its based.
But Subarus have always been different, catering to unique customers that desire something a bit more special than your run-of-the-mill sedan or crossover. It's clearly worked, with Subaru having posted 30 months of year-over-year sales increases as of this writing. And even as the automaker's portfolio goes more mainstream, smoothing out its serially awkward styling and gunning for a larger market share here in the United States, that intrinsic Subaru differentiation is still baked in to each and every product.
It's that new Outback we're here to talk about today, a vehicle that's been comprehensively redesigned for the 2015 model year while not shaking up the formula that's made it successful since its inception in the mid-1990s, back when it (arguably) launched what we now know as the crossover utility vehicle segment. It's still plenty different - and plenty good, too.

Subaru recalling over 8,000 cars for Takata airbag inflators

We have one more automaker to chalk up recalling Takata airbag inflators. Subaru is now throwing its hat in the ring by repairing 8,557 vehicles nationwide for faulty front passenger inflators. According to the Defect Notice from the National Highway Traffic Safety Administration, the problem affects 3,151 examples of the Legacy, Outback and Baja from the 2003 and 2004 model years and 5,406 units of the Impreza, including the WRX and STI (pictured above), from the 2004 model year.
As we all know by now, it's possible for the inflators to explode during airbag deployment possibly affecting not only the bag's inflation but also potentially spraying metal shrapnel at occupants. All of the affected vehicles will receive new passenger side inflators at no charge to the owner.
Seven automakers in the US announced recalls for the problem in late June affecting an estimated 2.1 million vehicles. Unlike some of the companies, Subaru is repairing all of the affected models in the US, rather just in certain warm-weather states. According to company spokesperson Michael McHale to Autoblog the reason is that "it was simpler to get everybody in there and make sure it was done." The replacement inflators should be in by the end of July, he said. Scroll down to read the recall report from NHTSA or download the full defect notice as a PDF, here.