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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

2018 Subaru Crosstrek improves on an already winning formula

There's a brand-new Subaru Crosstrek on the way for 2018, and the European version, known as the XV, is making its debut at the Geneva Motor Show. There's every reason to expect the new Crosstrek to be a stunning sales success. In 2016, Subaru sold 95,677 Crosstreks in the United States, easily besting models like the WRX, Legacy, and the Impreza upon which it's based. Those sales represented a 7.6 percent gain over the previous year, which is especially impressive considering that the Crosstrek is very much starting to show its age. The mini-crossover inherits all the benefits of the latest Impreza, including a stiff new chassis that promises drastically improved driving dynamics. Following in the footsteps of the larger Outback, which is based on the midsize Legacy, the Crosstrek adds a bit more ground clearance and aggressive off-road-lite styling to the compact Impreza hatchback. Don't expect the Crosstrek to tackle the Rubicon Trail – Subaru says it will have "excellent rough-road capability" – but do expect it to sell in droves in areas that get significant amounts of snow. View 15 Photos A 2.0-liter four-cylinder boxer engine delivers 154 horsepower to all four wheels through a continuously variable transmission. We generally prefer traditional stepped-gear transmissions, but Subaru has a history of keeping its CVTs pretty well behaved. Seven pre-programmed gear ratios can be selected by the driver in manual mode. A quick 13:1 steering ratio, active torque vectoring technology, and a lower center of gravity will all deliver dividends on the road, and 8.6 inches of ground clearance mean hard parts won't scrape the ground when the paved roads come to an end. All new Crosstrek models will come standard with EyeSight, a safety system that includes pre-collision braking control, adaptive cruise, and lane-keeping assistance. Blind-spot detection, lane-change assistance and reversing assistance will also be available. Expect more information to filter out soon, and stay tuned for live photos when we hit the show floor in Geneva. The US-spec Crosstrek will make its debut in April at the 2017 New York Auto Show. Related Video:

2019 Subaru Crosstrek Hybrid First Drive Review | Finally, a Subie with a plug - updated

SANTA BARBARA, Calif. — Subarus are pretty good to drive — capable, comfortable, generally affordable, interesting — and with one exception, they all offer all-wheel drive. And they're a relatively green company. The active, outdoorsy and often socially conscious drivers appreciate things like Subaru's commitment to diverting waste from landfills. But there's a fact that's been nagging many of us who love to hug dogs, trees and the occasional Subaru: there's no electric option. Subaru, an automaker small enough to get by with an efficient fleet of conventional gas vehicles, has been able to do without building a compliance car. Still, an increasing number of Americans want to be able to plug in their vehicles. For loyal Subaru fans, brand love and eco-consciousness have increasingly difficult to reconcile. That changes now, and not because of any specific regulation, but because Subaru sees the demand. By the end of this year, Subaru will be selling its first plug-in vehicle, the 2019 Crosstrek Hybrid. While Subaru has sold a Crosstrek that was a conventional hybrid before, the new 2019 Crosstrek Hybrid is Subaru's first plug-in hybrid. Sales of the previous hybrid weren't great, though, since it was expensive. Customers didn't choose to pay a premium for a few mere extra miles per gallon. Subaru hopes the extra fuel efficiency of the plug-in will increase the appeal. Even so, like Chrysler did with the Pacifica Hybrid, Subaru opted not to put "plug-in" in the name for 2019. Despite an arguable opportunity missed to set the record straight with a new and more descriptive name, there's no mistaking this thing is a PHEV. There are "Plug-In Hybrid" badges on both front fenders and the tailgate, and the door covering the SAE charging receptacle – at the rear of the driver's side, on the opposite side of the gas fuel door – is stamped with the words "PLUG-IN" writ large. While this thing looks every bit a Subaru, even if you pop the hood to take a look at the 2.0-liter boxer engine up front, the 2019 Crosstrek Hybrid borrows its PHEV technology from Toyota – more fruit of the partnership that bore the Scion FR-S and the BRZ. It has the same 8.8-kWh lithium-ion battery pack as the Prius Prime, but in the bigger, heavier Subaru it's only good for a modest 17 miles of all-electric range. If that figure is a little disappointing to you, you're not alone. We had hoped to see at least 20 miles of EV range in this thing.