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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

New Subaru Legacy may be getting smaller six-cylinder and sport models

Subaru gave the next-generation, 2015 Legacy a brand new, more sophisticated platform and improved interior at the Chicago Auto Show, but the engines were carried over barely changed from the previous gen. However, if a rumor from Car and Driver turns out to be true, then the power trains may be getting upgraded as well.
A source within Subaru indicates that the aging 3.6-liter flat-six might finally be getting a replacement in favor of a smaller, more powerful six-cylinder engine, and the four-cylinder may get direct injection. Both of them would be ready for the new Legacy's mid-cycle refresh in about three years, and they would likely be shared by new Outback too.
The turbocharged, GT trim has been absent from the US-market Legacy for the last few model years, but the insider hinted that it might make a return in the coming years. The new version would use the 2.0-liter turbocharged flat-four found in the Forester and the WRX. Though like the Forester, a turbocharged Legacy would likely only be available with the CVT.

Subaru says Forester logs 8,000 JDM orders in first month, 4x expectations

The 2014 Subaru Forester is not on sale yet here in the US, but it has been on sale in Japan since the middle of last month. In that time, Subaru says that the 8,149 customer orders it has received have more than quadrupled the original expectation of just 2,000 units.
To go along with these impressive orders so far, Subaru has also provided a breakdown of exactly what initial customers are ordering, and based on the numbers provided, it would appear that early customers are choosing well-equipped models. This includes almost 90 percent of all models being ordered with the new Subaru EyeSight system, and while close to two-thirds of the Forester models are equipped with the base 2.0-liter engine, the turbocharged Forester 2.0XT is the most popular individual trim level accounting for almost 40 percent of the orders out of four available trim levels. It will be interesting to see if this trend continues as more Foresters hit dealers, but this is definitely a good sign for the compact crossover right out of the gate.
There's a brief press release after the jump that gives a full breakdown of customer orders so far in Japan.