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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

Subaru teasing STI surprise for NYC show?

Subaru is no stranger to the Special Edition car, least of all where its vaunted WRX and STI are concerned. From Spec C to Prodrive to 22B, more than a handful of STI's around the world have been released as limited-run editions, often with stirring results. So, while we were more than a little bit surprised to see that big-wing crop up on the Subaru Twitter page today, we can't say as though its not true to the brand's history.
However, while most of the interesting WRX STI variants have been offered to Europe and Japan only, whatever is wearing that carbon-fiber-lipped wing is set to debut at the New York Auto Show this week.
We don't have a clue as to the precise nature of the car in front of that wing, save to say that it's likely based on the STI. We can guess, however that the extra vertical supports and the use of carbon fiber indicate a higher-performance version than currently exists. Anything from a racing application to some new goodies for the aftermarket are in the realm of possibility.

Subaru recalling 660k vehicles in some states for possible brake line corrosion

Subaru is recalling 660,238 vehicles located in 20 US states that use salt on their roads. It's possible that salty water could splash onto the rear brake lines, and it could eventually cause corrosion and potentially perforation, leading to a fluid leak.
The recall covers the 2005-2009 Outback and Legacy, 2008-2011 Impreza, 2008-2014 WRX and STI and 2009-2013 Forester. However, only vehicles currently or formerly registered in the following snowy US states or districts are covered: Connecticut, Delaware, Illinois, Indiana, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, West Virginia, Wisconsin and the District of Columbia. The company previously recalled the 2005-2009 Legacy and Outback to repair this problem, and now it's added the additional models, plus any of the original cars it missed the first time.
According to the defect notice from the National Highway Traffic Safety Administration, Subaru found a total of 24 cases of corrosion in US leading up to the recall. There was a single case of actual brake line perforation, but it happened in Switzerland, according to the document. The company believes that it would take seven or more seasons of winter driving on salty roads before any corroding would begin.