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U.S. tariff threat hits European automakers' stocks

FRANKFURT, Germany — A U.S. warning that it may introduce tariffs on foreign auto imports hit shares in German carmakers BMW, Daimler and Volkswagen on Thursday, which together have a more than 90 percent share of North America's premium car market. Washington said on Wednesday it had launched an investigation into whether car and truck imports are a national security issue due to signs they had damaged the U.S. auto industry. That could lead to new U.S. tariffs — up to 25 percent — similar to those imposed on imported steel and aluminum in March. BMW and Daimler shares fell as much as 3.1 percent in early Thursday trading, while Volkswagen's dropped as much as 2.5 percent. "(U.S. President) Donald Trump is obviously not thinking about how to prevent a trade war. Import duties on cars would be a nightmare for the German auto industry and would lead to a massive sales impact," said Thomas Altmann at Frankfurt-based asset manager QC Partners. BMW on Thursday condemned the move to consider tariffs. "The BMW Group is committed to free trade worldwide. Barrier-free access to markets is therefore a key factor not only for our business model, but also for growth welfare and employment throughout the global economy," it said. Daimler, which makes Mercedes-Benz cars, and Volkswagen, which makes upmarket Audis and Porsches, were not immediately available for comment. German carmakers produced 804,000 cars at local factories in the United States and exported 657,000 German-made cars into North America last year, according to German auto industry association VDA. China took pains on Thursday to welcome German firms and investments, with Premier Li Keqiang talking up relations after a meeting with German Chancellor Angela Merkel. BMW and Mercedes have expanded production capacity in the United States, but BMW, Audi, Volkswagen and Daimler have also invested billions to build new factories in Mexico in the hope of selling locally produced cars into the United States. German carmakers hiked vehicle production in Mexico by 46 percent to 620,000 cars last year, while production levels inside the United States fell by 6 percent to 804,000 cars because of a shift to Mexico, according to the VDA. BMW has its biggest factory worldwide in Spartanburg, South Carolina, and is the largest vehicle exporter among all the carmakers in the United States measured by value of goods exported. More than 70 percent of BMW's U.S.-made cars are exported.

Audi A5 and S5 Sportbacks look slinky for the Paris Motor Show

Following closely on the heels of the updated Audi A5 and S5 refresh, the German automaker introduced the 2017 Audi A5 and S5 Sportback. The vehicles are set for an official debut at the Paris Motor Show next month and share many of the same exterior touches as the regular coupes. Audi's sportback models are not sold in the US. A spokesman from Audi told Autoblog that the automaker is still deciding whether to bring the vehicles to the US. The A5 and S5 Sportback are aimed at drivers that want the same feel as the coupe with the added functionality of a hatchback – think wagon meets sedan. Besides the extra set of doors, there's very little that differentiates the sportback models from the coupes. The new models are built upon Volkswagen's MLB platform, which makes the car roughly 190 pounds lighter than the outgoing model. European customers will be able to choose between two TFSI and three TDI engines for the A5 Sportback. The engines range from a 2.0-liter inline-four that makes 190 horsepower to a 3.0-liter turbocharged diesel V6 putting out 286 hp. The engines can be paired to a six-speed manual transmission, seven-speed S tronic dual-clutch gearbox or an eight-speed tiptronic unit. Front-wheel drive is standard, with all-wheel drive as an available option on two variants. AWD comes standard when opting for the more powerful engines. The vehicles will also feature Audi's new Quattro Ultra all-wheel-drive system that can disconnect the rear wheels to be more fuel efficient. The S5 Sportback is the one enthusiasts will enjoy as it packs a turbocharged 3.0-liter V6 that's good for 354 hp and 369 pound-feet of torque. Audi claims the S5 Sportback, even with the addition of its new doors, will be able to get to 62 mph in 4.7 seconds, which is the same time as its two-door counterpart. In addition to the diesel and gasoline-powered vehicles, the A5 Sportback g-tron will be offered for drivers looking for flexible fuel choices. The g-tron model is powered by a 170-horsepower, 2.0-liter turbocharged-inline-four that can run on Audi e-gas, natural gas or regular gasoline. The exterior design is nearly identical to that of the coupes with Audi's new single frame grille and muscular front end. The rear incorporates a fastback-like design, similar to the one found on the A7, which helps soften the vehicle out – all sport in the front and luxury in the rear.

Audi RS3 Sportback is the hottest hatch

Fans of compact, European vehicles that mix luxury and performance should be in paradise right now. There's already the 320-horsepower M235i from BMW and the 355-hp CLA45 AMG (or A45 elsewhere) from Mercedes-Benz, but you can now add one more to the list. Meet the Audi RS3 Sportback, which boasts 362 hp and five doors, too. With propulsion coming from Audi's turbocharged 2.5-liter five-cylinder that makes 343 pound-feet of torque (465 newton-meters), the RS3 Sportback can scramble to 62 miles per hour in 4.3 seconds. Top speed is limited to 155 mph, but buyers can opt to raise that top end to 174 if desired. The inline-five is mated to a seven-speed S-tronic dual-clutch gearbox, sending power to the ground via Quattro all-wheel drive with torque vectoring, which can send between 50 and 100 percent of the power to the rear wheels as needed. To cope with the boosted output, the suspension has been lowered by an inch compared to the standard A3 Sportback, and magnetic dampers are a further option. Buyers can also tick the box for carbon-fiber-ceramic brake rotors at the front. The RS3 goes on a diet its latest iteration, too, weighing 121 pounds less than its predecessor. While buyers get potent power, Audi keeps the looks understated. The exterior wears a front airdam with larger openings and some aluminum flourishes, and a diffuser at the back gets some more matte trim. A roof spoiler and aluminum look for the mirror housings add a few other touches to catch the eye. Inside, all versions get sport seats covered in Nappa leather and a flat-bottom steering wheel wrapped in leather and Alcantara. But for the really sporty look, buyers can spec optional RS buckets with a carbon shell that weigh 15 pounds less than the standard units. European deliveries of the RS3 Sportback begin in the summer. Autoblog reached out to Audi spokesperson Mark Dahncke who told us there are currently "no plans to bring it to the US." Scroll down to read Audi's full announcement of this five-door hot hatch. Power in compact form – the new Audi RS 3 Sportback Ingolstadt, 2014-12-12 Sporty top model of the A3 model series Most powerful production five-cylinder in RS history with 270 kW (367 hp) 0 – 100 km/h (62.1 mph) in 4.3 seconds – 0.3 seconds faster than the previous model Hot, throaty sound, exhilaratingly free-revving and brawny power – the five cylinder engines from Audi are legendary.