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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

Hyundai, Genesis, Subaru warn their dealers about markups

Six weeks ago, word got out that Ford's VP of sales for the U.S. and Canada wrote one of those "It has come to our attention..." e-mails to the automaker's dealer body. The VP's problem was dealers trying to get reservation deposits for the Ford F-150 Lightning well above the official $100 fee. The tomfoolery resulted in interactions "with customers in a manner that is negatively impacting customer satisfaction and damaging to the Ford Motor Company brand and Dealer Body reputation." Two weeks later, GM told its dealers to cut out the reservation gaming and the markups on the 2023 Chevrolet Corvette Z06, banditry that's been going on for two years. Two weeks ago, Ford was back at it, this time about markups on the Bronco. Last week, Asian automakers swept into the melee, with Hyundai and Genesis, Subaru, and Infiniti writing letters to their dealers to deliver some variant of, "Stop pissing off the customers." Automotive News reported an SVP at Hyundai Motor America and the COO at Genesis Motor North America sent letters to their dealers expressing disappointment at "certain pricing practices which, if left unchecked, will have a negative impact on the health of our brand." One of the practices mentioned was dealer markups, another was the bait-and-switch, with dealers advertising one price then charging a higher price once the customer showed up at the lot. The letters acknowledged that dealers are separate companies to the automakers and have the right to set their own prices. The automakers cannot interfere with that; their leverage is distributing allocations and perks such as advertising support and financial incentives. So, like a movie boss letting the protagonist go on a technicality, the brands wrote, "we cannot stand idly by watching the actions of the aforementioned dealers undo all the efforts we collectively have put into making these brands what they are today." Jalopnik got tipped to a letter Subaru of America CEO Thomas Doll sent to that brand's dealers. Doll's polite yet insistent tone was the result of a letter a loyal Subaru owner sent to the automaker's VP of Customer Advocacy. In the market for a third brand-new Forester, the owner said they encountered a "tax" labeled a "Low Inventory Surcharge" of as much as $6,000, putting the Forester out of reach.

2017 Subaru BRZ gets more power, optional Performance Pack

Most of the recent action with Toyobaru sports cars has centered around the Toyota side, which saw the Scion FR-S replaced by the updated and rebranded 2017 Toyota 86 for our market. Now, Subaru's version of the rear-drive coupe is getting a similar set of updates. It gets to keep its name, though. Like its Toyota-badged twin, the BRZ sees some engine updates – changes to the shared 2.0-liter, flat-four's internals are aimed at reducing friction. A new aluminum intake and a redesigned exhaust bump output up from 200 horsepower and 151 pound-feet of torque to 205 ponies and 156 lb-ft on manual-transmission models. To go along with that, the manual's final-drive ratio has been changed from 4.1:1 to 4.3:1, so there should be an improvement in acceleration. (Incidentally, this must have been Toyota meant when it said the 86 gets different manual gear ratios for 2017.) It's not the turbocharged engine some have been craving, but we can all agree that a little extra output is better than none. Those paying for the automatic transmission are left out, though. The Subaru has also gotten a small set of suspension updates. There are new springs and dampers, a larger rear sway bar, and some adjustments to structural braces to increase rigidity, so nothing too dramatic. Subaru has reprogrammed the stability-control system to allow drivers more freedom, which has led to a showy rebranding of the Sport mode to a new Track setting. A new option is the Performance Package, which includes Brembo brakes with upsized rotors fore and aft, new Sachs-branded shocks, and black 17-inch wheels. The Performance Pack is only available on Limited models with a manual transmission, further strengthening the argument against the auto. The Performance Pack also helps differentiate the Subie from its Toyota pal, as those items aren't available on the 86. There are some subtle aesthetic changes too, similar to those on the 86. (Noticing a pattern?) Subaru restyled the front and rear fascias, and added LED lamps at all four corners. Limited models come with a new 4.2-inch LCD display that sits to the right of the tachometer; in addition to mechanical info like oil temp, water temp, and battery voltage, it can show a G meter, a steering-angle indicator, gas/brake meters, and a stopwatch. The 2017 BRZ Premium and Limited will hit dealers in September. You'll have to wait until winter of 2017 to get your hands on a car equipped with the Performance Pack.