[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.

This post has been edited by cdnsolman: 02 October 2007 - 02:24 PM

[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.

[Captainbooyah]

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

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