Automakers slapped with $2B lawsuit

[Dragon]

http://www6.autonet.ca/News/story.cfm?stor...4527976-cp.html

by DAVID FRIEND -- Canadian Press posted September 26, 2007

TORONTO - Several automakers have been slapped with a $2-billion class action lawsuit that claims the industry conspired to artificially maintain car prices in Canada and inhibited cross-border vehicle shopping fuelled by a rising loonie.

The suit was filed with the Ontario Superior Court by Toronto-based law firm Juroviesky and Ricci on behalf of four Toronto residents who bought or leased cars between August 2005 and August 2007.

The plaintiffs say they forked out more money for cars in Canada than they would have for similar or identical models in the United States and are seeking $2 billion in general damages as well as $100 million in punitive damages.

Named in the lawsuit are the Canadian and U.S. divisions of General Motors (NYSE:GM), Honda, Nissan and Chrysler.

"We believe that we have uncovered a conspiracy that has been designed and choreographed by the automobile manufacturers to artificially enhance the price of cars in Canada to Canadian consumers," Henry Juroviesky, the firm's managing partner, said in a telephone interview.

Representatives of the auto dealers and some of the carmakers declined to comment on the lawsuit. However, a spokesman for GM Canada said the company prices its cars and trucks in part after observing what rival automakers do in a competitive marketplace.

As the loonie hovers around parity with the U.S. dollar, many Canadian consumers have questioned why there's such a big price difference between the two countries on many ordinary goods imported from the U.S. - everything ranging from guitars and DVD players to flat-screen TVs, cars, trucks and baby products.

In Wednesday's lawsuit, the plaintiffs allege that the automakers worked together to minimize cross-border competition and limit the number of new cars that crossed the border. As well, the lawsuit alleges that the companies breached both the Competition Act and the Consumer Protection Act in Canada.

"Cars on an absolute basis are just cheaper in the United States and one has to wonder why. When you go and try to exercise that reasonably available efficient alternative, you're stopped," Juroviesky said.

"Tinkering has been done, we allege, with the market forces that don't allow a downward adjustment to Canadian auto prices of an efficient alternative supply."

Included in the allegations are claims that the automakers agreed not to honour warranties for vehicles purchased across the border, forcing Canadian consumers who wanted a manufacturer's warranty to pay 25 to 35 per cent more on average for a vehicle in Canada.

"It would be expected under natural laws of competition that if not for the defendants' conspiracy to artificially maintain their domestic prices in the U.S. at historical levels, the prices of U.S. domestic goods would have fallen to approximate the price levels of the readily available Canadian alternative," the suit said.

None of the allegations have been proven in court and the suit has yet to be certified officially as a class action by a judge.

The suit also claims some auto sales contracts included "no-export clauses" that prevented buyers from taking their cars from the U.S. to Canada, or vice-versa.

It also alleges manufacturers penalized dealers if the cars they sold were later exported, either by threatening to delay shipment of certain models or issuing "chargebacks."

Also named in the suit are the Canadian Automobile Dealers Association, or CADA, and its Viriginia-based U.S. equivalent the National Automobile Dealers Association.

CADA spokesman Huw Williams said that as of Wednesday afternoon the association had yet to receive a copy of the suit.

"We're obviously not prepared to either comment on it or anything revolving around it," Williams said from Ottawa.

Representatives for Honda and Nissan did not return calls for comment while Chrysler declined to discuss the suit.

In the United States, a similar pricing lawsuit is being heard at a court in Maine which involves both U.S. and Canadian automakers and dealers. The suit, filed in 2003, claims that Americans were denied warranties for vehicles they bought in Canada when the U.S. dollar was well above the loonie.

It's hard to ignore the sometimes drastic price differences between Canada and the United States, which are more apparent on higher-end models.

For example, the 2007 Honda Accord Sedan starts at C$25,090 in Canada while it costs US$20,360 in the United States. The higher end Cadillac Escalade EXT starts at C$71,730 while it sells for US$55,045 south of the border.

Vehicles cited in the suit include a leased Jeep Grand Cherokee Overland, which it says under a lease had a sale price of C$58,645 while it was advertised in the U.S. at less than US$40,000. A GMC Yukon Denali was purchased by one of the plaintiffs for C$69,615 while it was priced at US$50,000 stateside.

While GM Canada spokesman Stew Low declined to comment on the specifics of the case, he said GM prices its vehicles by observing how fellow automakers are acting in Canada.

"It's an extremely competitive marketplace," he said in an interview. "We price to what we believe we need to do to be competitive in the various segments."

Low also noted that regulatory differences between Canada and the U.S. can drive up so-called logistics costs. He said daytime running lights and higher bumper standards increase the cost of vehicles, such as the bumper system on the Corvette, which he says is "totally unique" in Canada.

The class action suit materialized just as Porsche announced on Tuesday plans to chop Canadian prices on its 2008 models by an average of about eight per cent.

"We cannot ignore our customers and dealers in Canada who can look to the U.S. and recognize a substantial price difference," Peter Schwarzenbauer, president of Porsche Cars North America Inc. said in a release.

But Juroviesky said the move was "too little, too late."

"Even if they're lowering their prices by 10 to 15 per cent that's not enough and they should've thought about that two and a half or three years ago when the dollar flipped," he said.

-

TORONTO - A sample of current manufacturer suggested retail prices for automobiles in both the United States and Canada:

-Honda Accord Sedan 2008

Canada: C$25,090

U.S.: US$20,360

-Honda Odyssey 2008

Canada: C$33,300

U.S.: US$25,645

-Cadillac Escalade EXT

Canada: C$71,730

U.S.: US$55,045

-Chevy Monte Carlo

Canada: C$25,230

U.S.: US$21,700

-Nissan Maxima 3.5 SE

Canada: C$36,998

U.S.: US$28,130

[Snate]

What a waste of time and taxpayer money.

[Newbiewar]

why just target the automakers...

i know most books say USD 9.99 CAN 14.99

its called currency exchange...

usually lawyers tell their clients if they have a decent case

[Dragon]

why just target the automakers...

i know most books say USD 9.99 CAN 14.99

its called currency exchange...

usually lawyers tell their clients if they have a decent case

if currency exchange were the reason, then that book and those car's should be 1:1, thats the whole basis of this lawsuit.

I imagine the reason they are going after automaker's and not publisher's is the relative price difference in the products. $3-4 on a book isnt' a big deal and since most people dont' look long term, they just dont' care. $5-10k on the other hand tends to get and keep people's attention

The suit hasn't been certified, and unless they can somehow prove the companies were colluding to keep car prices higher here, I doubt it will be since there are a lot of factor's that make our car's more expensive, including the fact the Canadian car maker's have to make up for profits lost on cars made here and sold to the US

[Camino LS6]

BS

[Intrepidation]

Many moths ago I saw a few reviews on auto123.com where they complained about the Canadian prices, because even with the exchange rate factored in there was still an overcharge...

[PurdueGuy]

The canadian vehicle prices do need to work their way down to be more in line, but the fact is it takes time. Are all other goods now costing the same as in the US now that the exchange rate is the same? I doubt it. I takes time, welcome to a real-life economy vs playing with paper.

[Newbiewar]

well shouldnt they go after japan inc, for jacking up prices in their own market?

its not fair for the japanese to pay almost twice what americans pay

[Newbiewar]

The canadian vehicle prices do need to work their way down to be more in line, but the fact is it takes time. Are all other goods now costing the same as in the US now that the exchange rate is the same? I doubt it. I takes time, welcome to a real-life economy vs playing with paper.

well with Auto sales in america... inflation over the last 15 years has only been like 13%

where as the rest of the goods in america have gone up by as much as 54%

its just highly competative here...

no one can complain about profits...

if this lawsuit were to succeed, one should be able to go from dealership to dealership and complain the price is different...?

[PurdueGuy]

well with Auto sales in america... inflation over the last 15 years has only been like 13%

where as the rest of the goods in america have gone up by as much as 54%

its just highly competative here...

no one can complain about profits...

if this lawsuit were to succeed, one should be able to go from dealership to dealership and complain the price is different...?

I'm not saying prices should be the same, just that they're probably more different than they'll work out to be given some time. With an even exchange rate, the automakers should be coming out further ahead on Canadian vehicle sales. Pricing competition will probably work the Canadian pricing down with time. The lawsuit is dumb.

[siegen]

fuelled by a rising loonie

Fueled by a crazy guy!

[FAPTurbo]

Fueled by a crazy guy!

No, a Loonie is a duck.

America was founded by George Washington, which is why he is on your one-dollar bill. Canada was founded by a duck, and so a duck is on our coin, and we call that coin a Loonie.

[Intrepidation]

No, a Loonie is a duck.

America was founded by George Washington, which is why he is on your one-dollar bill. Canada was founded by a duck, and so a duck is on our coin, and we call that coin a Loonie.

A duck? Well that tells a lot about Canadians then

[GXT]

This is excellent.

The fact is that the CDN dollar has been appreciating VS the US dollar for some time, yet each year (for the most part) the cost of Canadian vehicles continues to go up. The auto makers have had chances to hold the line or even drop the prices a little, but they have continued to increase them. They obviously need this kind of encouragement.

As for the difference in models, daytime running lights cost what? A few dollars? And the bumper issue is a problem on VERY few cars.

The next car I buy I will ask a Canadian dealership for price-parity (or, by that time, perhaps a 10% discount) VS the US price. If they don't do it then I will have to buy a Lexus or a BMW from the US (as they both offer NA-wide warranties and I can't afford a 911 Turbo).

[GXT]

The suit hasn't been certified, and unless they can somehow prove the companies were colluding to keep car prices higher here, I doubt it will be since there are a lot of factor's that make our car's more expensive, including the fact the Canadian car maker's have to make up for profits lost on cars made here and sold to the US

I'm not sure why Canadians should pay more for a car because an automaker no longer makes as much when they build a car in Canada and sell it in the US. It isn't their responsibility to subsidize the US consumer.

[FUTURE_OF_GM]

why just target the automakers...

Because 1) They're an easy target and 2) They're high profile.

Just another law firm trying to make a name for themselves while getting rich off of the backs of others... Typical american bull$h!, but pretty surprising for Canada.

[VenSeattle]

It's funny though... Not everything in Canada is imported. It still costs the same to manufacture many of those cars in Canada as it did 2 or 4 years ago.

[sciguy_0504]

What about those in England? The EuroZone? The currency exchange rate is even higher in those areas.

[CaddyXLR-V]

The only thing that can support this lawsuit, is the collaboration between companies to inflate prices, or price fixing. Otherwise, a company has the right to charge whatever they feel like charging, and you have the right to not buy it.

[FAPTurbo]

The law-firm doesn't bank on winning this, or at least I don't think so. They're also suing other companies on separate issues.

What it will do, is give Canadians more incentive to head south for vehicle purchases. I don't see why I should pay $45,000 for a Crew-Cab Silverado LTZ up here, when I can drive down south in an hour, and get one for $35,205. (I kinda can't, due to stupid agreements)

I'm not sure if Canadian dealers assume Canadians are stupid, or don't have internet access, but we'll vote with our dollars. I have absolutely no problem heading State-side to buy stuff, because it's cheaper, and the American's can use some more business these days.

[ellives]

I'm not saying prices should be the same, just that they're probably more different than they'll work out to be given some time. With an even exchange rate, the automakers should be coming out further ahead on Canadian vehicle sales. Pricing competition will probably work the Canadian pricing down with time. The lawsuit is dumb.

It's just more whining. Pricing is determined by market conditions. Plain and simple.

[traderchpl]

For those that know the differences, how much of this price disparity has to do with corporate tax structure differences between the 2 countries?

I assume the price differences don't include any sales or local taxes, which are added on to the MSRP.

But, federal and state/provincial taxes that are paid by employers (taxes on profit, property, matching income taxes/employee "burden," etc.) are hidden in the MSRP. Just like the pretty hefty gas taxes.

Does anyone have any actual numbers that can explain part, all, or none of this disparity?

[Sixty8panther]

Can I have that 45 seconds back...

you know, the time I spent reading about this complete B.S.

(good post though Dragon)

[GXT]

For those that know the differences, how much of this price disparity has to do with corporate tax structure differences between the 2 countries?

I assume the price differences don't include any sales or local taxes, which are added on to the MSRP.

But, federal and state/provincial taxes that are paid by employers (taxes on profit, property, matching income taxes/employee "burden," etc.) are hidden in the MSRP. Just like the pretty hefty gas taxes.

Does anyone have any actual numbers that can explain part, all, or none of this disparity?

I think taxes are a red herring. Here is what happened:

About 30 years ago a Canadian dollar was worth more than a US one. Over the next 30 years the Canadian dollar steadily dropped against the US dollar. During that time the price of Canadian cars increased to cover the exchange rate difference (or at least enough of it). As recently as 2002, the Canadian dollar was worth ~.625 US dollars. I recall that in 2004 a 27,000 USD TSX was going for 37,000 in Canada (no taxes included in either price). Since that time the Canadian dollar has appreciated ~60% VS the US Over the past 5 years. Today? A 2008 TSX in the US is 28,905USD and 37,855 Canadian in Canada. ~37% more in 2004 and 31% today. Or, to look at it another way, Canadians are paying 4,364,174 yen for a TSX (the TSX is made in Japan) and the US is paying 3,320,028 yen.

How long should Canadian consumers wait?

To put it Cheers and Gears terms, if the US suffered from the Candian pricing issues, you would be stuck paying CTS money just to buy an Impala. Don't tell me that wouldn't piss you off to drive around in an Impala knowing that you should have had a CTS for the same money.

Last year I was talking to the Denon rep in my area of Canada. I was complaining about the price difference north and south of the border on Denon's products. I asked when they were going to adjust for the value of the dollar. His response was something to the effect of:

1) Canadian consumers are used to paying this much.

2) He was under the impression that the natural state was for the US dollar to be worth significantly more than the Canadian, and Denon was just waiting for that to be the case again. He may be waiting a long time.

As long as manufacturers use artificial warranty barriers to segment markets they should be subject to these lawsuits.

[Dragon]

It's funny though... Not everything in Canada is imported. It still costs the same to manufacture many of those cars in Canada as it did 2 or 4 years ago.

no it doesnt. a lot of materials used in the manufacturing process are still imported

[ellives]

I think taxes are a red herring. Here is what happened:

About 30 years ago a Canadian dollar was worth more than a US one. Over the next 30 years the Canadian dollar steadily dropped against the US dollar. During that time the price of Canadian cars increased to cover the exchange rate difference (or at least enough of it). As recently as 2002, the Canadian dollar was worth ~.625 US dollars. I recall that in 2004 a 27,000 USD TSX was going for 37,000 in Canada (no taxes included in either price). Since that time the Canadian dollar has appreciated ~60% VS the US Over the past 5 years. Today? A 2008 TSX in the US is 28,905USD and 37,855 Canadian in Canada. ~37% more in 2004 and 31% today. Or, to look at it another way, Canadians are paying 4,364,174 yen for a TSX (the TSX is made in Japan) and the US is paying 3,320,028 yen.

How long should Canadian consumers wait?

To put it Cheers and Gears terms, if the US suffered from the Candian pricing issues, you would be stuck paying CTS money just to buy an Impala. Don't tell me that wouldn't piss you off to drive around in an Impala knowing that you should have had a CTS for the same money.

Last year I was talking to the Denon rep in my area of Canada. I was complaining about the price difference north and south of the border on Denon's products. I asked when they were going to adjust for the value of the dollar. His response was something to the effect of:

1) Canadian consumers are used to paying this much.

2) He was under the impression that the natural state was for the US dollar to be worth significantly more than the Canadian, and Denon was just waiting for that to be the case again. He may be waiting a long time.

As long as manufacturers use artificial warranty barriers to segment markets they should be subject to these lawsuits.

Rubbish. Pricing is established based on the market. If a manufacturer prices too high for the market, nobody will will buy the product. There's simply no basis for a lawsuit here. It's a total waste of time and money.

[gg22]

This is excellent.

The fact is that the CDN dollar has been appreciating VS the US dollar for some time, yet each year (for the most part) the cost of Canadian vehicles continues to go up. The auto makers have had chances to hold the line or even drop the prices a little, but they have continued to increase them. They obviously need this kind of encouragement.

As for the difference in models, daytime running lights cost what? A few dollars? And the bumper issue is a problem on VERY few cars.

The next car I buy I will ask a Canadian dealership for price-parity (or, by that time, perhaps a 10% discount) VS the US price. If they don't do it then I will have to buy a Lexus or a BMW from the US (as they both offer NA-wide warranties and I can't afford a 911 Turbo).

Do not come into our dealership and ask for this or you may get shot. I am sick to death of jackass's coming in or phoning to bitch about the price of Canadian vehicles. We are bound by the invoice price from GMCL. Do you think we're gonna loose 10K to sell a car to your dumb ass? You know that the price is lower in the States so go spend your dollars in their econemy. Don't waste the time of anybody at the dealership level. Drive to Oshawa and make your demands to the people who set the price. And while you're at it drive to Walmart, Safeway, Chapters, ETC. and bitch at them. It is a fact of life that we Canadians pay 20-30% more than Americans for ANY consumer product. Why do people only dwell on the vehicles?

[frogger]

The next car I buy I will ask a Canadian dealership for price-parity (or, by that time, perhaps a 10% discount) VS the US price. If they don't do it then I will have to buy a Lexus or a BMW from the US (as they both offer NA-wide warranties and I can't afford a 911 Turbo).

Good luck buying a new Lexus from the US. Dealers have been instructed not to sell to people who don't have a US address. This is the big difference between importing cars and other consumer goods. At the very least hopefully this lawsuit keeps more manufacturers from doing the same (Toyota/Lexus are not the only ones).

There is a lot of discussion about importing on the forums of redflagdeals.com. GM vehicles can be imported but they will not honour the warranty for the first 6 months. How does a new Corvette for $45K Canadian sound?

Its been reported that Canadian dealers have also been instructed not to honour aftermarket warranties of imported vehicles as well.

[cdnsolman]

If anybody was dumb enough to pay full price for a vehicle, why is that Honda's, GM's, or Jeep's fault. We've known that prices were significantly cheaper in the states for years, why now are they complaining. How about before you sign the lease. Has any body out there heard of the term "as is where is?" It means if you didn't do your research, you are the one to blame, not the company you purchase it from.

I hope the lawyer knows that after this is all over, he is going to get sued for overcharging them.

Edited October 2, 2007 by cdnsolman

[VenSeattle]

no it doesnt. a lot of materials used in the manufacturing process are still imported

I can understand how that would be cost effective now... but not 2 or 4 years ago back when the US dollar was so much stronger than the Canadian.

I can see manufacturing moving from Canada to the US in the future... but GM and other companies manufacturer several components in Canada and then ship them stateside for assembly.

[brewboy]

The law-firm doesn't bank on winning this, or at least I don't think so. They're also suing other companies on separate issues.

What it will do, is give Canadians more incentive to head south for vehicle purchases. I don't see why I should pay $45,000 for a Crew-Cab Silverado LTZ up here, when I can drive down south in an hour, and get one for $35,205. (I kinda can't, due to stupid agreements)

I'm not sure if Canadian dealers assume Canadians are stupid, or don't have internet access, but we'll vote with our dollars. I have absolutely no problem heading State-side to buy stuff, because it's cheaper, and the American's can use some more business these days.

Just bought a 2007 Denali all options except power steps for $47,557 in Riverside CA. That compared to the same truck up here in Canada for $65-$74,000. Canada gets none of the Bonus cash offers or Program cash like the US does. The US/Canadian border is seeing a huge increase in exports. Almost all the dealers in Canada are buying used vehicles in the US and reselling for big profits. Why is OK for a dealer to do it and not you and me?

[CARBIZ]

Just bought a 2007 Denali all options except power steps for $47,557 in Riverside CA. That compared to the same truck up here in Canada for $65-$74,000. Canada gets none of the Bonus cash offers or Program cash like the US does. The US/Canadian border is seeing a huge increase in exports. Almost all the dealers in Canada are buying used vehicles in the US and reselling for big profits. Why is OK for a dealer to do it and not you and me?

First of all, not everyone has the expertise, time or CASH to do what you just did. There are a lot of ramifications to licensing the vehicle up here, taxes to be paid, etc. There was a time, only a few years ago, where American used car dealers were coming up here and buying up everything. We were not allowed to sell a Suburban, Tahoe or Corvette to anyone who was paying cash, without a lot of serious checking because Americans were coming up here and buying those vehicles.

I do understand that there are a lot of built in costs to marketing and distributing products in Canada: let's face it - California has a bigger population in a fifteenth the size of Canada. You would be amazed at what a difference of 5 degrees celsius will do to energy and production costs, for example.

Still, the market will eventuallly take care of this. For the time being, it would appear that manufacturers are trying to recoup some of the monies they 'lost' back in the day when the our dollar was .65 U.S.

[FloydHendershot]

For the time being, it would appear that manufacturers are trying to recoup some of the monies they 'lost' back in the day when the our dollar was .65 U.S.

Those were the days. When you could go to Canada with twenty bucks in your pocket and live like a king for a weekend and all the tasty red herring you can eat for pennies on the dollar.

[ellives]

Those were the days. When you could go to Canada with twenty bucks in your pocket and live like a king for a weekend and all the tasty red herring you can eat for pennies on the dollar.

They'll be back..... when Bush is escorted out of the White House.

[frogger]

Just bought a 2007 Denali all options except power steps for $47,557 in Riverside CA. That compared to the same truck up here in Canada for $65-$74,000. Canada gets none of the Bonus cash offers or Program cash like the US does. The US/Canadian border is seeing a huge increase in exports. Almost all the dealers in Canada are buying used vehicles in the US and reselling for big profits. Why is OK for a dealer to do it and not you and me?

Well done.. It a year or so a US purchased Corvette is going to be awfully hard for me to resist.

[CARBIZ]

You do realize that there is a big difference between the used and new car markets, don't you? Gas guzzlers like the Denali are not sold well up here, therefore, finding a good used one is rare and supply/demand dictates they will be more expensive up here than in the U.S. where gas prices are 20-30% less and big vehicles sell better.

You guys crow about 'freedoms' and capitalism, which is what the used car market is all about. If 5 dealers show up at an auction (where most of the newer used vehicles are bought) and get into a bidding war over the 2 measly Denalis that are there, you would naturally expect the prices to be higher.

I'll bet more Tahoes, Suburbans and Denalis are sold in California in a year than all of Canada.

[Dragon]

An interesting side note to this.

Bombardier (a Canadian company none the less), who makes Ski-Doo's and Snow-Doo's, has told its American dealer network to put a surcharge on products they sell to Canadians who come across the border looking to take advantage of the exchange rate and to eventually stop selling product to Canadians altogether for fear of having their dealer contract canceled altogether. I wonder if we might see this eventually happening to car dealers eventually as well

[GXT]

Do not come into our dealership and ask for this or you may get shot. I am sick to death of jackass's coming in or phoning to bitch about the price of Canadian vehicles. We are bound by the invoice price from GMCL. Do you think we're gonna loose 10K to sell a car to your dumb ass? You know that the price is lower in the States so go spend your dollars in their econemy. Don't waste the time of anybody at the dealership level. Drive to Oshawa and make your demands to the people who set the price. And while you're at it drive to Walmart, Safeway, Chapters, ETC. and bitch at them. It is a fact of life that we Canadians pay 20-30% more than Americans for ANY consumer product. Why do people only dwell on the vehicles?

If a "jackass" or "dumb ass" is someone who expects to pay fair price, then I guess I am one. Why would I buy a vehicle today that SHOULD and COULD and MAY be 20-30% less expensive tomorrow? That is stupid.

Here is an alternate way to view this. Be glad that the "jackass" gave you the chance to even match the price. I routinely buy items off ebay from the states and Home Depot or Rona never even has the chance to match. I really don't care who is making the extra profit. I'm not going to pay it.

As our American friends have pointed out, the market sets the price. It is the consumer's responsibility to be a "jackass" at your dealership. Then, when you are a dick to them for wanting fair value, they have an obligation to go buy from the states and deny you and everyone at your dealership their share of the sale.

FYI, it isn't a fact that Canadians pay 20-30% more for ANY consumer product. I buy computer parts from a Canadian site that is now often less expensive than US sites like Newegg. The difference is that there are some businesses that are better able to take advantage of the situation. The auto industry is at the top of that list.

[GXT]

Good luck buying a new Lexus from the US. Dealers have been instructed not to sell to people who don't have a US address. This is the big difference between importing cars and other consumer goods. At the very least hopefully this lawsuit keeps more manufacturers from doing the same (Toyota/Lexus are not the only ones).

There is a lot of discussion about importing on the forums of redflagdeals.com. GM vehicles can be imported but they will not honour the warranty for the first 6 months. How does a new Corvette for $45K Canadian sound?

Its been reported that Canadian dealers have also been instructed not to honour aftermarket warranties of imported vehicles as well.

I understand that Subaru, Toyota, and BMW will honour the warranty.

As for buying from a US dealership, I understand that all you need to convince Toyota dealer is an address from a US Time Share... or just head south another state or two.

I'm good until 2010, so hopefully things will be adjusted by then. If not, I guess I will find out at that time how much trouble I am willing to go through.

Yes, I'd even consider a Corvette for $45K. And according to gg22, the Canadian dealership I bought my last two cars from doesn't even want to see me.

[FAPTurbo]

Yes, I'd even consider a Corvette for $45K.

At 45K, who wouldn't consider a Corvette?

[CARBIZ]

If a "jackass" or "dumb ass" is someone who expects to pay fair price, then I guess I am one. Why would I buy a vehicle today that SHOULD and COULD and MAY be 20-30% less expensive tomorrow? That is stupid.

Here is an alternate way to view this. Be glad that the "jackass" gave you the chance to even match the price. I routinely buy items off ebay from the states and Home Depot or Rona never even has the chance to match. I really don't care who is making the extra profit. I'm not going to pay it.

As our American friends have pointed out, the market sets the price. It is the consumer's responsibility to be a "jackass" at your dealership. Then, when you are a dick to them for wanting fair value, they have an obligation to go buy from the states and deny you and everyone at your dealership their share of the sale.

FYI, it isn't a fact that Canadians pay 20-30% more for ANY consumer product. I buy computer parts from a Canadian site that is now often less expensive than US sites like Newegg. The difference is that there are some businesses that are better able to take advantage of the situation. The auto industry is at the top of that list.

Well, good for you Daddy Warbucks. Makes me wonder where you earned all that CASH to be able to afford to buy a $50k car with. Maybe a quick call to Revenue Canada is in order!

Right now, for better or worse, GM is concentrating on the 90% of the people who lease or finance, because at 8-9% bank rates, nobody is going to be clamoring over the border for used or nearly new cars, I'm afraid. It kinda makes me laugh to the point of crying that the guy with deep pockets whose company makes its profits on this side of the border is the first to cry foul and skip over the border whenever it suits him.

And good luck with importing a nearly new vehicle. Not only may the vehicle require inspection (daytime running lights, etc., odometers, etc) and costly upgrades to get insured here, there are also other factors (like a 6.1% duty on certain imported cars), the GST and PST having to be paid in CASH as well (that can be another $7k on a $50k vehicle). There are also 'green' levies that have to be paid at the border. $2,000 on a Denali. I hope you have an American Express Gold Card.

Yeah, everyone targets the big, bad dealer, because after all, spending $50 a week too much on groceries at, say, Loblaws, when you can buy the same products at a NO Frills for a lot less is not the same thing.

[GXT]

Well, good for you Daddy Warbucks. Makes me wonder where you earned all that CASH to be able to afford to buy a $50k car with. Maybe a quick call to Revenue Canada is in order!

A job?

Right now, for better or worse, GM is concentrating on the 90% of the people who lease or finance, because at 8-9% bank rates, nobody is going to be clamoring over the border for used or nearly new cars, I'm afraid.

Sure, if you have to pay those kinds of rates. But if you don't then it isn't as much of an issue.

It kinda makes me laugh to the point of crying that the guy with deep pockets whose company makes its profits on this side of the border is the first to cry foul and skip over the border whenever it suits him.

And what if I make my profits by selling services to Americans? By your logic shouldn't I buy from the US?

Of course I would rather buy in Canada, but I am not going to support these business practices (which are pretty much extortion). Besides, I really don't understand how, when given the choice between auto companies charging too much and me expecting a fair price, you can say that I am the one in the wrong.

And good luck with importing a nearly new vehicle. Not only may the vehicle require inspection (daytime running lights, etc., odometers, etc) and costly upgrades to get insured here, there are also other factors (like a 6.1% duty on certain imported cars), the GST and PST having to be paid in CASH as well (that can be another $7k on a $50k vehicle). There are also 'green' levies that have to be paid at the border. $2,000 on a Denali. I hope you have an American Express Gold Card.

It will take some effort, but for 10-20K I can easily justify a number of days of effort... especially if I get a trip out of it as well. Record numbers of people are doing it (I believe imports reached 100,000 last year... and I think that was up 50%). Luckily I know a number of people who have done it so they will be able to help me. I know the inspection and changes are minor. The 6.1% duty doesn't apply to a lot of vehicles (and even when it does it is worth it). The GST and PST are actually LESS on a US car because the cost of the vehicle is lower. And believe me, I'm not buying a Denali.

Yeah, everyone targets the big, bad dealer, because after all, spending $50 a week too much on groceries at, say, Loblaws, when you can buy the same products at a NO Frills for a lot less is not the same thing.

I suggest that instead of complaining about consumers who are doing their dutyby buying at a fair price even in the face of the near-extortion of auto companies, you encourage GM Canada (or whoever) to adjust their prices. Edited October 22, 2007 by GXT

[CARBIZ]

A job?

Sure, if you have to pay those kinds of rates. But if you don't then it isn't as much of an issue.

And what if I make my profits by selling services to Americans? By your logic shouldn't I buy from the US?

Of course I would rather buy in Canada, but I am not going to support these business practices (which are pretty much extortion). Besides, I really don't understand how, when given the choice between auto companies charging too much and me expecting a fair price, you can say that I am the one in the wrong.

It will take some effort, but for 10-20K I can easily justify a number of days of effort... especially if I get a trip out of it as well. Record numbers of people are doing it (I believe imports reached 100,000 last year... and I think that was up 50%). Luckily I know a number of people who have done it so they will be able to help me. I know the inspection and changes are minor. The 6.1% duty doesn't apply to a lot of vehicles (and even when it does it is worth it). The GST and PST are actually LESS on a US car because the cost of the vehicle is lower. And believe me, I'm not buying a Denali.

I suggest that instead of complaining about consumers who are doing their dutyby buying at a fair price even in the face of the near-extortion of auto companies, you encourage GM Canada (or whoever) to adjust their prices.

Don't believe the hype, sir: most of the cross-border shoppers importing vehicles are wholesalers who are buying the cars on behalf of dealers, then selling them back here. The media is jumping on the bandwagon, like they do in every other ill-researched 'issue of the month' news item. Very few people have the cash, the know-how and the patience (having to fax the title to the border 72 hours ahead of time, for example.) The only people who care about big ticket items, like vehicles, are the people who can pay cash and since they are such a miniscule part of the market (even the truly rich prefer to lease!) I doubt anybody here is losing sleep over it. The auto manufacturers are concentrating on subvented rates and 'freebies' like free sunroofs on this side of the border, because that is where the market is.

In truth, Canada is such a small market that most manufacturers treat us as little more than a branch office. Multinationals like Sony, Toyota, VW and others barely acknowledge our existance. The cost of doing business here is far greater than most other places they do business in (California buys more cars than all of Canada, for example) so do not expect price parity ever.

If manufacturers were forced to do that (like the Quebec government tried with media companies in the '80s), they would just drop Canada as a market altogether.

[GXT]

Don't believe the hype, sir: most of the cross-border shoppers importing vehicles are wholesalers who are buying the cars on behalf of dealers, then selling them back here. The media is jumping on the bandwagon, like they do in every other ill-researched 'issue of the month' news item. Very few people have the cash, the know-how and the patience (having to fax the title to the border 72 hours ahead of time, for example.) The only people who care about big ticket items, like vehicles, are the people who can pay cash and since they are such a miniscule part of the market (even the truly rich prefer to lease!) I doubt anybody here is losing sleep over it.

I have one co-worker, a neighbour, and a friend of a co-worker who have all done it in the past year. None of them are wholesalers. Nor is the process particularly difficult. Don't doubt for a minute that average people are doing this.

The auto manufacturers are concentrating on subvented rates and 'freebies' like free sunroofs on this side of the border, because that is where the market is.

In truth, Canada is such a small market that most manufacturers treat us as little more than a branch office. Multinationals like Sony, Toyota, VW and others barely acknowledge our existance.

I fear you are right, and unfortunately that is why we need lawsuits like this. The extortion needs to end.

[I hope GMRULES again]

I think we're getting stiffed here too. We never get the amazing sale prices and factory to dealer stuff the states gets. I just compared an Impala LT on gm.com and gmcanada.ca with the exact same options and the price difference is $6,040.You notice it even more the way the options are priced. Why is a sunroof $900 in the U.S. and $1340 cdn or a body side moulding $100 u.s and $145 cdn.

[CARBIZ]

I have one co-worker, a neighbour, and a friend of a co-worker who have all done it in the past year. None of them are wholesalers. Nor is the process particularly difficult. Don't doubt for a minute that average people are doing this.

I fear you are right, and unfortunately that is why we need lawsuits like this. The extortion needs to end.

As usual, the media is blowing this all out of proportion. There are inherent costs of doing business in this country (providing everything in French is one of them!) and if this lawsuit is successful, you may see some manufacturers pull out of Canada. Don't laugh: Paramount pictures did it in Quebec about 15 years ago when their draconian language laws forced media companies to open Quebec branch offices.

And three people does not make a trend. The posers who want high end vehicles are the first to whine when mommy takes away their milk. Average people don't have the cash. Zero financing on the Impala will save the 'average' person $3k and there is currently a $2k 'stackable credit' on the Impala. Many manufacturers are adjusting the prices quietly, just not on the MSRP. What would happen if the Canadian dollar backslid to .90 and then prices suddenly jumped? Large companies are naturally conservative. Nobody believes the Canadian dollar will stay at $1.03 for very long.

Funny, nobody was complaining when the Tahoe was $5k cheaper in Canada, when adjusted for the dollar, five years ago.

[GXT]

And three people does not make a trend.

No, they don't. They are simply examples of average people that I know that bought cars from the US. They simply showed me how easy it is. And now I am simply telling other people. And I will consider doing the same thing when the time comes. But it does not make a trend. Rest easy knowing that this will have no effect on your sales.

The posers who want high end vehicles are the first to whine when mommy takes away their milk. Average people don't have the cash. Zero financing on the Impala will save the 'average' person $3k and there is currently a $2k 'stackable credit' on the Impala. Many manufacturers are adjusting the prices quietly, just not on the MSRP.

That's fine. If there is that kind of cash on the table then when I ask for a Canadian dealer to match a US price they will have something more to give me. I will evaluate it when the time comes.

What would happen if the Canadian dollar backslid to .90 and then prices suddenly jumped? Large companies are naturally conservative. Nobody believes the Canadian dollar will stay at $1.03 for very long.

Yeah, I heard the same thing from the local Denon rep last year when the dollar was .80(?).

"Nobody"? Care to think about that again? There is plenty of reason to believe the Canadian dollar will stay strong against the USD.. Even if it did settle back to par, how does that justify the horrible valuation ( 0.6-0.8 ) that auto companies seem to be averaging?

Funny, nobody was complaining when the Tahoe was $5k cheaper in Canada, when adjusted for the dollar, five years ago.

People tend to complain more when it is something they actually desire. Edited October 26, 2007 by GXT

[GXT]

I think we're getting stiffed here too. We never get the amazing sale prices and factory to dealer stuff the states gets. I just compared an Impala LT on gm.com and gmcanada.ca with the exact same options and the price difference is $6,040.You notice it even more the way the options are priced. Why is a sunroof $900 in the U.S. and $1340 cdn or a body side moulding $100 u.s and $145 cdn.

Well according to Carbiz it is because GM had to make a brochure that had french in it and you are a whining poser for even questioning it. He would encourage you to buy the car in Canada now, let GM pocket the extra $6K, and you can be out that money in a year or two when things have adjusted and your resale value has tanked by that much more.

I'm with you. I'm not even expecting the amazing US deals. I'm just hoping to match MSRP.

Please join me in voicing your concern by saving your $$$.

[CARBIZ]

Well according to Carbiz it is because GM had to make a brochure that had french in it and you are a whining poser for even questioning it. He would encourage you to buy the car in Canada now, let GM pocket the extra $6K, and you can be out that money in a year or two when things have adjusted and your resale value has tanked by that much more.

I'm with you. I'm not even expecting the amazing US deals. I'm just hoping to match MSRP.

Please join me in voicing your concern by saving your $$$.

No, sir, it's the cost of doing business in Canada, for GM, Sanyo and everybody. This is a big country, transportation costs, marketing costs, health care (which ain't 'free' at all) and - my personal favorite: you'd be surprised at what the difference of 5 degrees celsius makes in energy costs for a company doing business in Canada, versus the U.S.

But, yeah, it's a free country. Take your money elsewhere. Just don't go bitching on some board somewhere when YOUR job is gone because everyone went somewhere else. Or maybe you're lucky enough to have a job that isn't effected by the political whims of our economy. Lucky you.

[frogger]

The thread on redflagdeals of people discussing how-to import, sharing success stories and roadblocks encountered importing now has over 860,000 views on it.

Hopefully pricing in Canada changes a bit.. I don't expect to see parity but a 10% difference rather than 20-30% would be nice. Especially if the vehicles are assembled here. I pay more in income taxes each year than what I would spend on a vehicle, and would still be paying PST, GST and a $300 RIV fee upon importing a vehicle, so I don't feel any obligation to buy the vehicle in Canada to spend an extra 5 to 10K.

Besides if I use the same logic people here use for Japanese vehicles assembled in North America, the "profits go back to the USA" anyways in the end.