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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 mulling expanding Indiana plant for Forester, Impreza

Thanks to currency fluctuations and their impact on the bottom line, a growing number of Japanese automakers are starting to increase vehicle production in the US, and it appears Subaru could be the next to do so. According to Bloomberg, Subaru is looking into expanding production capacity at its Lafayette, Indiana assembly plant, which currently builds the Outback, Legacy and Tribeca as well as the Toyota Camry.
Subaru's Indiana plant currently has an annual maximum capacity of 310,000 units, but the automaker is expecting to far exceed that figure this year, with year-to-date sales of 299,788 units through November (not including Camry) - an increase of almost 30 percent over 2011. The report indicates that Subaru could expand the plant to add as many 50,000 additional units to the plant, likely in the form of either the Forester or Impreza.

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.