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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

Hyundai, Genesis, Subaru warn their dealers about markups

Six weeks ago, word got out that Ford's VP of sales for the U.S. and Canada wrote one of those "It has come to our attention..." e-mails to the automaker's dealer body. The VP's problem was dealers trying to get reservation deposits for the Ford F-150 Lightning well above the official $100 fee. The tomfoolery resulted in interactions "with customers in a manner that is negatively impacting customer satisfaction and damaging to the Ford Motor Company brand and Dealer Body reputation." Two weeks later, GM told its dealers to cut out the reservation gaming and the markups on the 2023 Chevrolet Corvette Z06, banditry that's been going on for two years. Two weeks ago, Ford was back at it, this time about markups on the Bronco. Last week, Asian automakers swept into the melee, with Hyundai and Genesis, Subaru, and Infiniti writing letters to their dealers to deliver some variant of, "Stop pissing off the customers." Automotive News reported an SVP at Hyundai Motor America and the COO at Genesis Motor North America sent letters to their dealers expressing disappointment at "certain pricing practices which, if left unchecked, will have a negative impact on the health of our brand." One of the practices mentioned was dealer markups, another was the bait-and-switch, with dealers advertising one price then charging a higher price once the customer showed up at the lot. The letters acknowledged that dealers are separate companies to the automakers and have the right to set their own prices. The automakers cannot interfere with that; their leverage is distributing allocations and perks such as advertising support and financial incentives. So, like a movie boss letting the protagonist go on a technicality, the brands wrote, "we cannot stand idly by watching the actions of the aforementioned dealers undo all the efforts we collectively have put into making these brands what they are today." Jalopnik got tipped to a letter Subaru of America CEO Thomas Doll sent to that brand's dealers. Doll's polite yet insistent tone was the result of a letter a loyal Subaru owner sent to the automaker's VP of Customer Advocacy. In the market for a third brand-new Forester, the owner said they encountered a "tax" labeled a "Low Inventory Surcharge" of as much as $6,000, putting the Forester out of reach.

Subaru fights sticker shock with financing deal on $65,000 WRX STI S209

Subaru's American division has come a long way since it peddled the tiny 360 during the late 1960s. The limited-edition, $65,000 WRX STI S209 unveiled during the 2019 Detroit Auto Show is its most expensive car yet, so the company is taking steps to make it a little bit more accessible. The Japanese firm sent its American dealers a bulletin announcing the S209 is eligible for 3.49% APR for up to 63 months, according to CarsDirect. The publication noted that rate amounts to monthly payments of $1,131 over 63 months, which adds up to $71,231. Buyers are still forking over more than $6,000 to the bank, but they're saving about $4,700 compared to a 6% loan. That's a substantial amount of money to drop on a WRX STI; it's priced in Audi TT RS territory. For the money, enthusiasts get one of the rarest street-legal cars Subaru has ever produced. After driving it, we called it the fastest, sharpest-handling, and most sophisticated WRX ever to grace our shores. It's powered by a 2.5-liter flat-four engine turbocharged to 341 horsepower and 330 pound-feet of torque, generous increases of 31 and 40, respectively, over the regular WRX STI. We'll let you decide whether exclusivity and power are worth a roughly $22,000 premium. If you want an S209 in your driveway, act fast because production is strictly limited to 209 examples, and odds are the entire batch will be spoken for sooner rather than later. Keep in mind dealers will be tempted to slap a markup on the car due to its rarity, so you might need to spend more — in some cases, a lot more — than the number listed on the window sticker. Featured Gallery 2020 Subaru WRX STI S209 View 41 Photos Auto News Subaru Car Buying