Armed terrorists kidnaped a top West German business leader tonight and killed four of his bodyguards in a fresh outburst of urban violence.

Hanns Martin Schleyer, 62, president of the West German employers' association, the Confederation of Industry, was abducted from his Mercedes sedan at an intersection during the evening rush hour here.

The gunmen, driving a minibus, sprayed Schleyer's motorcade with machine-gun fire, killing two police escorts, a security agent and a driver.

Chancellor Helmut Schmidt, who confirmed the kidnaping in a television broadcast tonight, said his government is more determined than ever to press its fight against terrorists.

Police quickly speculated that the five young killers might have been leftist urban guerrillas.

An anonymous telephone call later to the Munich office of the mass-circulation newspaper Bild Zeitung said Schleyer would be executed Tuesday unless Andreas Baader and other convicted terrorists were released from prison.

The caller, a man speaking hastily, set a deadline of 5:15 p.m. local time for the execution.

"This is the Action Society [rest of name unintelligible]. We demand the release of Baader and everyone imprisoned in Stammheim," the caller was quoted by the newspaper as saying. "Otherwise Herr Schleyer will be executed at 5:15 p.m. tomorrow."

Two West German news agencies reported receiving similar phone calls from a group called the Red Army Faction.

The increase in urban guerrilla activity in West Germany followed the life sentences handed down in April for three hard-core leaders of the Baader-Meinhof group. The trio are in Stuttgart's top-security Stammheim prison where they ended a 26-day hunger strike Friday after winning an assurance that detention conditions would be eased.

Schleyer was a government adviser on labor and economic problems. He also served as a member of the board of Daimler-Benz, the makers of the Mercedes automobile.

It was the third attack in recent months involving prominent West Germans. Extreme leftist groups have claimed responsibility for the two previous attacks.

Chief federal prosecutor Siegfried Buback was assassinated in Karlsruhe April 7, and banker Erich Ponto was slain July 30 in his home near Frankfurt. Both attacks were blamed on followers of the anarchist Baader-Meinhof gang.

Today's killings were reminiscent of the attack on Buback and his two aides, who were killed by a burst of automatic fire from a motorcyclist waiting alongside his car at an intersection in downtown Karlsruhe.

A grim-faced Schmidt appealed for anyone able to provide the police with information "about those murders and the kidnaping of Hanns-Martin Schleyer" to come forward. The chancellor described the attack as "a bloody provocation which is a challenge to us all."

Cologne police said a group of young men in a yellow minibus ambushed Schleyer's motorcade at a crossroads and sprayed it with gunfire. Three men with him died instantly.

Cologne was quickly surrounded by a tight security cordon.

The heavy-set Schleyer became head of West Germany's powerful industry confederation last year. In frequent appearances on national television, he explained the position of big business on labor negotiations and other domestic economic issues.

He gained some notoriety because of his connections with the Nazis during the Hitler regime, when he was a prominent member of a Nazi student organization.