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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

Drive looks at a pair of STI-ified Subaru Impreza RS Coupes

Among tuners, the legions of Subaru fans are hard to top, displaying all the fanaticism of English soccer fans and a dedication to their vehicles that borders on obsessive. These are compliments, by the way. In the latest video from Drive, Matt Farah takes a look at a pair of very special Imprezas - early Impreza 2.5RS Coupes that have had some serious heart transplants.
The first, a traditional blue model, sports the 2.5-liter, turbocharged flat-four from the 2004 WRX STI, which is good for around 300 horsepower. The other Impreza is a bit more hardcore - the engine is a 2.0-liter, turbocharged four-cylinder from the JDM WRX STI, which we suppose makes it more of an Impreza 2.0RS Coupe. Besides the different engines, both cars represent the unique ideas and style of their owners.
The 10-minute video explores this, digging into why people tune, and how it's a reflection of their own personal driving style and character. Take a look below for another fun vid from the team at Drive.

Subaru teasing new WRX S4 model ahead of Japanese debut

The Subaru WRX range is growing just a little bit larger, at least in Japan, with the automaker's teasing announcement of a new version called the S4. Unfortunately, the company is keeping details about its latest all-wheel drive sport sedan a closely guarded secret for the moment.
From what we can glean, it appears that the S4 might be a more luxurious take on the WRX. According to the release, the name stands for the four qualities that Subaru wants the sedan to have: "'Sports performance', 'Safety performance', 'Smart driving' and 'Sophisticated feel.'" As part of this focus, the car comes with the company's EyeSight camera system. Thankfully, we don't have too long to wait to find out what all of the buzz words actually mean because Subaru is unveiling the S4 on August 25 in Japan.
The automaker also launched a teaser website for the S4 that you can cheek out, here, but at the moment it doesn't provide any more details about the new sport sedan. The site just has countdown until the August reveal. There's also no indication yet whether this potentially more premium WRX could make it US shores. Scroll down to read the Subaru's rather concise teaser for the upcoming S4.