Jun 27
Not a Canadian Dealer Issue!?
We all realize that our American Cousins are paying $7-8 Billion a year less than Canadians for the same Cars. We recognize that this is not a Canadian Dealer issue. All these excess profits go right back to the head offices in the U.S., Japan and Europe. Depriving Canadians of a better standard of living!
But could not the Canadians Dealers do more?
Here is an interesting point of view we just received from a dealer. What do you think? Please write your feelings and point of view in our comments section:
Quote: Just because I’m in Sales at a Canadian dealer, please read my post with an open mind, and take all this into consideration. Here’s my $1000 worth:I have read most of the comments here, and I think only a minority of people here understand that the issue is not with the Canadian Auto Dealers, but with the way pricing is structured for different markets.First of all, us Canadian Dealers have no say in invoice, or MSRP pricing. That is set by the manufacturers. Just because a Gogo Mobile XL is made in the US for both Canadian and US market and retails for $10k less in the US, doesn’t mean the dealer in Canada has an extra $10k in profit to make.Second of all the US auto market is 10 times bigger than our Canadian market, and yes even though many vehicles are nearly identical, there are changes that have to be applied at the factory for our market because of Transport Canada regs (as dumb as they may seem, yes). Those differences however, may add to production, engineering, testing, and assembly costs to the products that are being sold here.Is it costing the manufacturers $1k-$30k difference to warrant such a price discreptency between the US and Canada? Maybe not, but it still adds some cost, more evident on less expensive models.Even in Canada there are different offers/rebates, and specials for different provinces/territories. The market may be different from one suburb to another, hence different incetives. A buyer in Ontario may receive a better deal than someone in BC on the same veheicle. That’s just marketing strategies to adjust to various markets around the country/countries. If you’re from BC and want to go to Ontario to save a few bucks, by all means go ahead. But don’t blame your BC/local dealer for “ripping you off” or “price gouging”. Once again we have no control over the manufacturers interest rates/rebates/promos. All we have is the room to play with in our profit margin. And it’s not huge like many think it is.Next issue is supporting local businesses. The Canadian Auto Industry employs tens of thousands of people, ranging from manufacturing jobs, sales, service, parts, and it spreads into support services for these businesses such as construction/renovations (of stores/businesses/dealerships), computer support, food services, furniture, equipment, building maintenance and repairs, parts/delivery drivers, advertising, media, and other services provided to us. Once automotive sales take a dip due to cross border shopping, the dealerships affected by it will in turn spend less money on these local services, resulting in a revenue dip for those proprietors. The people working at these dealerships will also spend less if they take a cut in their earnings due to decreased sales. They may not be doing the home renovation they wanted, or spend the money on toys/entertainment/electronics/services/local vacations. In turn it may be your business that will be affected, directly or indirectly, because you chose to vote with your dollars across the border and buy a vehicle there. The savings you may have earned on your purchase may be pale in comparison to what your business will lose in the long run. By that time, the same folks who are here complaining to Transport Canada, will be the same folks who will be asking government for assistance due to revenue loss in their own line of work because all of a sudden the “economy is sagging”
And this leads into the topic of profit. Everyone mentions it like it’s a bad thing. Every business needs to have a profit in order to stay afloat. It doesn’t matter if it’s an auto dealership, or if it’s your grocery store that pays your wages. I expect you to make a profit on whatever business you’re in or on whatever you sell me. So don’t expect me to work for free either. If the profit margin is too much then consumers will vote with their dollars. But if those dollars go across the border, then don’t expect profits in return at your local business because that money will not come back into Canada.
Others here mention that they don’t like the fact that some dealers treat them differently because they have US bought vehicles. Let me ask you this. If you have a business and have a loyal life-long customer who supported you, that is waiting for your services, or you have someone that spent their money elsewhere and you probably won’t see ever again who would you give preferential treatment to?
Then I see people who are willing to remortgage their house to get a lawyer to fight these importation rules. Are you serious? You’d rather stress over something like this and spend money on this issue instead of enjoying life, spending time with family or kids or friend? Yeah you’re ticked off, I’d be too. But how much time and money is it worth it so you can save a few precious dollars on your next car? How much time are you willing to sacrifice to “stick it to the man” by buying across the border? And is it all worth it for someting that you’re probably only going to keep 3 to 5 years? There’s enough local dealers that you can shop at to get a good deal. It’s not that complicated.
And lastly, what most people don’t want to realize, is the US imports they’re bringing in at a savings right now, will amount to same or worse depreciation than if they’d buy locally, when it’s time to resell it or trade it in. Take a $30k CDN car, and let’s say you can get it for $25k in the US, after import. 4 years later that Canadian car will take on a $10k depreciation hit. You sell it for $20k, you lost $10k. That US car will take on a smae or higher hit because it’s not local, and from the US. So you’ll lose a minumum of $10k if not more. Do you think you can resell it for the same price as a local car? Which car would you choose if the price was the same? A local Canadian car with ,or a non local US car with harder to trace accident history, ownership details etc? Anmd if you think that’s not going to be the case, any US car that comes in on a trade will get the US book value price which will be substantially lower than a comparable Canadian car. You can bet on it.
And no, my dealer does not have any US imports. We buy, trade and deal locally.
Good luck with your battles. I prefer to spend my valuable time on important things in my life: family and friends.
—————————————————————————
I as a dealer understand the point that most of your readers make: the hassles and runaround involved with vehicle importation process, and the pricing differences are mind boggling, when they don’t have to be.
I posted my point of view, which I think reflects that of most Canadian dealers facing this challenge, because usually dealers are not very vocal about this issue. I’m also interested as to what kind of response my post will get.
Thank you for giving both sides a voice, and I will keep in touch.
June 27th, 2008 at 9:16 pm
All I have to say is, is this guy for real? If the dealerships are having such a hard time why don’t they speak up and get prices lowered? Or better yet, refuse to sell cars at such a marked up price. This is nonsense.
June 27th, 2008 at 10:02 pm
It’s OK for the dealer to make a good profit for him to spend locally but why isn’t it OK for me to save on my purchases so that I can spend my own money and educate my kids and even buy a better car with more equipment. Free trade is good for all to buy TV’s - DVD’s, Golf Clubs but why is it very bad if it’s for CARS? Sorry complaining will not protect your sales - lowering prices and competing fairly will help your sales. Yes dealers are certainly not in full control - the manufacturers are deciding on world pricing - so expect Canadians to fight back - CWB is fighting back. Listen to the Radio show on Sunday to know more about this issue.
June 27th, 2008 at 10:32 pm
Nice comment…let us all support the Canadian economy and higher those car prices…let me get my wallet and run to the dealer. You said it, the goal here is to have the manufactures price their cars on a fair manner, not a 5-10K premium.
As a dealer, YOU should be putting pressure on your supplier/manufacturer to lower their prices for your customers, and don’t stop until fair pricing with the US. If the general premium was $1000-$1500, this site probably wouldn’t exist.
Charge fair price and you will get those many customers which will come in over-and-over again to service their vehicles, because they’ll have more disposal income left over from the savings you gave them on the deal. Then they can be gouged by those high mechanic service rates those dealerships charge…ok, we won’t touch that crusade.
BTW: my company always looks for ways to help lower the costs for their customers, its call competition.
June 27th, 2008 at 10:36 pm
I will support local business, but I will not do so at the expense of having the wool pulled over my eyes. Prices can be lowered, so please don’t make the consumer out to be the bad guy here when we all know the manufacturers are the ones that are forcing Canadians across the border with their price gouging. Its human nature to not want to be taken as a fool and paying significantly more for the same car in Canada in the name of patriotism and supporting local business is brainwashing nonsense.
June 27th, 2008 at 10:42 pm
Your comments are well taken as related to the Invoice you are charged by the manufacturers. In that sense, you are also at the mercy of the Brands you may represent in the Canadian Market.
Which leads to the first point. A vehicle coming off the line for the manufacturer has, (excluding the Transport Canada and RIV BS) a more or less fixed cost to produce. Leaving the destination/transportation charges off, this means that the manufacturer is artificially shifting taxation on profits away from Canada in a big way. It also keeps you guys, (the dealers) in line fighting over profit crumbs while they make offshore with the serious booty, not even giving you a pricing chance to make a comparable deal with me that makes some sense. As a real example, for me, it represented $14,600 dollars difference on a 4 door “X” sedan. And remember, those are after tax dollars, so grossed up to salary at the marginal rate, that’s approaching 20,000 in salary that got salvaged. Plus, the warranty is more extensive that the comparable Canadian version.
While you make a fair case that as a Canadian Auto Industry person you might not do a kitchen renovation because of my “choice”, the 1000:1 ratio (a simple guess) of retail buyers who saved the thousands after tax can more than infill for those narrow losses to the economy per lost Auto industry wallet consumer. Sad, perhaps harsh to you, but true.
No, the common enemy we have in this discussion is the same: Transport Canada, carrying the battle banner under the direction of the rest of our own elected government who knowingly created this mess in spite of NAFTA.
To fight with you over the crumbs doesn’t make any sense. Just like you, the money left over in my bank account at the end of the year is simply how much I made in “sales or work” (after Tax freedom day for the “services” the Government takes in Taxes - what an insult) less what I spend. This year I have 14,600 more after tax dollars to dump elsewhere in the economy than I would have had by buying the same 2008 in Canada, and no change in my income.
You’d think I’d be happy. But I’m not, and I certainly take no pleasure in robbing you of your potential sale. You must be able to understand that I’m not the social agency or community volunteer that donates a heavy lift of their wages to the down trodden beyond my chosen charities. We are supposed to have a government for that, because they take nearly half my income to do it in various direct and hidden taxes. However, I do assure you that I am currently *way* more active in watching the elected scumbags who purportedly look after my interests as a citizen in this, and curiously as I look around, in other areas.. And, I see by the thousands, we are collectively turning out to be their worst nightmare in the start of the 21st century. The glimmer of hope is that it’s looking like the free backroom old boys club ride on our collective backs is in for a rougher sail, thanks to the huge increase in open blogs and threads like these.
Welcome to the new democracy. (I would include yourself in that, as you have stepped up and made your thoughts known as have the rest of us around this stuff). The tide will turn for you and us. Keep up the pressure, for both our sakes.
June 27th, 2008 at 11:20 pm
Hey Canadian dealer, no battle, i just don’t share your view.
June 28th, 2008 at 12:27 am
Hey dealer
Here is an article for you to read from 2003.
http://www.odili.net/home/money/news/2003/may/5.html
Does this ring a bell for you!!!!
June 28th, 2008 at 12:34 am
This whole business about the US market and Canadian market and about then building different vehicals for Canada is nonsense for the most part. When BMW builds a car, the don’t build it for Canada and for the United States, the build it for North America. For god sakes, the cars land in Canada first, then goto the United States, yet we even pay a higher shipping cost????
A friend of mine that works high up in a “Auto Manufacturer” told me Canadians should not have to pay anymore than 3% than Americans on automobile purchases… but they won’t admit to that!
They will milk the Canadian market for as long as “we” allow them. In the end it is Canadians that will dictate what happens, but not enough of us complaining about this, we always just seem to take it on the chin.
It just isn’t fair, they are no better than the oil industry raping us at the pumps!!!!!!
June 28th, 2008 at 8:34 am
Alex - Very worthwhile arcticle to read and I like this part that I extracted….
(2003) Canadian dealers like selling to U.S. buyers,” says Brian Osler of the North American Automobile Trade Association, an Ontario-based group representing import car brokers. “It’s a cash sale, and they don’t have to go on a test drive.”
June 28th, 2008 at 9:43 am
“Good luck with your battles. I prefer to spend my valuable time on important things in my life: family and friends.”
Everyone does…. The thousands I’ll save buying a car in the U.S. will help me improve the quality of my family time, for example, taking a vacation with my family, meeting up with friends at a local bar to watch a hockey game, etc. With more disposable income, I’ll be more likely to support local businesses instead of having to complain about car manufacturers lining their pockets with my money for a lesser equipped car than I could have bought in the U.S.
June 28th, 2008 at 10:40 am
Another thing this dealer says is that I will be crying to the Government to bail out my business due to me buying my car in the States as apposed to Canada. NOT!!!! The Canadain Government is in the business of bailing out large corporations like Air Canada and General Motors!!!! They would not give my small business a dime, this is a fact, because i see business like mine going out of business everyday!!! Where is the Government giving them money to stay aflot!!!
I could care less if GM loses money and shuts down plants… I say GOOD!!!! They have been raping us for so long and now they feel the pinch!!! Get competitive or get the hell outta Dodge!!!
June 28th, 2008 at 1:37 pm
A chap by the name of Jim Kenzie of Motoring TV discussed this same issue back in March, you can check out the replies and feedback he received.
http://www.carswithoutborders.com/2008/03/page/5/
check out our posts of Mar 15th and March 17th, Same issues.
June 28th, 2008 at 1:57 pm
Absolute rubbish!
Dealers are car salespeople are all the same.
Professional liars!
Whether it be when they try to sell you a used car, with a blown engine for a premium price, or try to give you reasons why an IDENTICAL Japanese car in Vancouver is $10,000 than it is in Florida. And even though both cars land in the Vancouver port, the shipping to Vancouver is more. They expect us to buy into this crap?
Even cars that do require some modifications for Canada, these price difference in some models are 20,000-30,000
No way in Hell fussing with the bumpers cost that much.
June 28th, 2008 at 5:55 pm
Mr. Dealer:
Please do not assume that the status quo is going to prevail. The interenet has made information readily availble. There is so much information on this website and those with links to it that show how much more Canadians pay. A few years ago, it was not possible for the average Canadian to know how badly he was being disadvantaged in comparison with the American buyer. That has changed and if you are going to stay in business you should consider this change.
A friend does four to five internet car sales a week over the phone because of the internet. He ships them all over North America. The buyers get the car that they want (not the one you push on the buyer because it is in your inventory) at a price that is competitive (not the price that moves the maximum amount of money from the car buyer to the car dealer).
Dealers were only too happy to sell their used cars into the higher priced U.S. used market when the Canadian dollar was low. That left the Canadian consumer paying more for a car because there were less used cars available in Canada. Now you are asking for loyalty. What loyalty did you show to your customers when you shipped all those cars to the U.S. and made significant profits.
Why do North American dealers sell OEM parts made in China. What support is this to Canadian industry.
As for the auto makers, they are in trouble because they have no respect for the consumer and for that matter their dealers who are trying to deceive the Canadian public into believing that Canadian prices after incentives, finanacing, etc are lower. If you are blatantly deceiving consumers as a dealer, why would anyone want to do business with you.
Why are the Canadian dealers not doing anything for their customers by lobbying the manufacturers to sell to them (the Canadian dealers) at the same price at which they sell to their American dealers.
What have the auto dealers done to promote harmonization of motor vehicle safety and environmental standards?
I will not buy another car in Canada as long as the prices in Canada are higher than the United States. I have been involved in the purchase of four cars from the U.S. It was not a big deal, excepting that BMW wanted an exorbitant amount of money to enable me to import a 750Li. I would have preferred to buy locally but over $40,000 of after tax money was saved on that one purchase.
Unless Canadians are treated fairly by the auto manufacturers and their dealers, expect to see more Canadians heading south to buy a car.
June 28th, 2008 at 9:24 pm
What needs to be done is, the Government of Canada needs to wake up!!!! They should be dictating to the manufacturers, not the other way around. The Government of Canada should say if its good for the United States, its good enough for Canada and take the dealers/manufacturers out of the picture entirly.
June 29th, 2008 at 12:46 am
The biggest problem right now is education. Apparently, not enough Canadians bother to compare U.S. pricing, or when they do, and mention it to the salesperson, they believe the excuses and lies that they are told. This is why sales have not dropped to zero here yet. Thanks to CWB though, the truth is slowly and surely getting out there.
As long as Canadians keep buying at the current prices, they have no reason to lower them!
June 29th, 2008 at 10:27 am
The author says that I should expect to get less when I eventually sell the new car I paid at a lower price. I glad expect that! As a portion of the cost of a lease is carrying the residual value of the car, if that value is less my overall cost is less.
June 29th, 2008 at 11:16 am
Re Luc Lafrance comment 17
The Canadian market value in three or four years for a used 2009 Toyota or any other brand will be no different for this car whether it is purchased now in the U.S. or Canada. What would make the value any different? Is the buyer going to differentiate between a car that is from the U.S.
Many people are driving used U.S. cars that they purchased from Canadian dealers (as used). They did’t need to know where the car came from or want to know…all they knew is that they bought what they wanted.
The Canadian dealers make the profit that Canadians could have saved if the Canadians had made the effort to surf the internet until a car was found in the U.S. (or perhaps, though less likely in Canada) that met the requirements of the Canadian.
Canadians for the most part are willing to pay the higher Canadian price rather than make the effort to buy in the U.S. or do anything (sign a petition, write key members of Parliament (all of which are listed on this website)that could result in their being able to buy cars in Canada at the same prices as are available in the U.S. That is why the auto manufacturers can charge more to Canadians. Canadians are apathetic. Our politicians listen to the hundreds of auto company lobbyists and forget about “ordinary Canadians” (check Transport Canada documents for a definition of “ordinary Canadians”.
Did the dealer invest in the local economy or add another dealership in another city to his empire? I cannot conclude that the dealer is altruistic and attempts to reinvest his profits only in the community in which he made them.
This is a free country (or is it?) so the dealer should be able to do with his profits what he wants. His purchases in the local community are made for one reason…to generate profits. The individual is not in the business of generating profits but trying to retain some hard earned after tax money for his personal benefit and that of his family. Should the individual not have the same freedom to save as the dealer does to profit.
By the way, when you see a GM, Ford or other sign at a dealership, if you were to check the plate on the base of the sign, you would find that it in all liklihood it was not made in your community. The dealer or auto manufacturer likely only hired a local erector to install the sign….a small part of its cost.
The dealer may attempt to demonstrate that it is a member of the community by sponsoring a local kids hockey team or charity but for most dealers it is only because the dealer sees that is in his business interest to do so.
June 29th, 2008 at 1:29 pm
We, as consumers, have to vote with our pocketbooks. This means going to the dealer with the lowest cost for the specific product, whether it be a car or book. If dealers think they are being charged too much for their product (thus having to charge too much) then they need to take steps to bring the cost down. They need to vote with their pocketbooks. If not, they will go under, just like we would if we always bought the most expensive of everything. The consumers are doing their part to bring fair prices, and so to should the dealers. It’s their job! Get busy!
June 29th, 2008 at 1:37 pm
When you are in business for yourself, you lobby for the lowest purchase prices, purchase the best products and provide the best service to make your business successful and attractive to customers.
Canadian dealers must get together as a national group and lobby their respective automotive manufacturers as a strong group to get lower prices from the manufacturers, to be competitive with US dealers. When are they going to realize that?
Instead of complaining that Canadians are buying in the US and complaining that we are not supporting the local economy, they should be changing with the times and lobbying the manufacturers for better pricing. It is their major business problem in trying to remain competitive and they must solve it!
The dealer that wrote this letter just simply does not get it. It is not the consumers problem, it is his business problem which the dealerships must resolve.
This dealer admits that he is more inclined to look after local buying customers. I have heard this comment a number of times. This has pushed me even further away from the local dealerships. I will not take my new truck to a local dealership for any servicing unless it a warranty issue. So now the local dealerships are even losing out on the servicing of vehicles purchased in the US. When will they learn how to promote their businesses?
June 29th, 2008 at 2:38 pm
I understand some of the authors comments, but does not the rule, the customer is always
right hold some weight in the automotive industry as well.
Who are you serving?
June 29th, 2008 at 2:55 pm
Although the Dealers can be at the mercy of the Manufacturers, what pressure have they exerted on the manufacturers to lower prices? Why do cars made in Canada have a higher freight charge here then in the U.S.? Canadians have had enough and the dealers should be advocating on our behalf to ultimately improve their business!
I waited for 5 months hoping that our local Honda dealer could come close to US prices. Honda Canada had the audacity to increase both MSRP and the freight costs while refusing to honor the US warranty.
I would gladly give my business to my local dealer if they offered to import a car for me at US prices(+import costs) as a form of protest against Canadian Manufacturer pricing. I am sure that there are other ways to buck the system until manufacturers bring prices in line. Until then the invisible hand of the market will sort this out.
June 29th, 2008 at 10:35 pm
I do have some sympathy for you in the fact that you have no control over the price you pay the manufacturer for your vehicles. But, one thing you can control is the service you give to your customers. By treating a customer of an imported vehicle by a lower set of standards than of one of your “loyal” customers, you are probably never going to see that customer in your showroom again no matter what happens with the dollar level or parity pricing situation. Isn’t the money you make from servicing either vehicle the same color? From what I read it looks like you want to make a profit, or are you petty enough to turn away an ‘imports’ business. How is it any different if a customer bought his vehicle at a different Canadian dealership? Is he not one of your “loyal” customers? Will you turn him and his money away also?
June 30th, 2008 at 1:21 am
No sympathy here. Mr Dealer, you speak with the tongue of a “communist brother” - as if we would all be better of if we thought like you. Typical passive Canadian Dealer trying to justify old school thinking….Wake up and smell the coffee Dealer Mao!
Many people have been buying goods (and large ticket items) from the US market and abroad for decades - for the moment, it’s just caught up to your automotive market AND with your pants down. (I guess you, a DEALER, dont recall just a few years ago when the CDN-US currency was quite reversed -0.75cdn=1usd….AND what was the Canadian automotive industry doing at that time - Oh yeah! - they were SELLING THEIR canadian cars, SUVs to our neighbours south of the 49th!….not one of them was complaining then….and as usual, holding their nose high to Cdn buyers with a ‘take ot leave it attitude’!! )
I even remember being asked to pick up a few SUVs myself from several local dealerships (at full price) and then having them
transported south. Everyone made $$ - no one complained about these sales….taxes were paid….everyone was happy INCLUDING the dealers.
And now you make a feeble attempt justifying your case sounding like a broken record - jeeez louise….
Have you ever heard of fleabay? or NAFTA? It’s coming your way if you haven’t. We all want the WALMART concept - goods AND services at cheap prices…NOT CANADIAN PRICES. Why do you think mothers band together on late night road trips heading south of the border to the 24hr Walmarts? Because they enjoy it??? OF COURSE they enjoy it! AND THEY ENJOY the bargain prices too!! And you really believe those that have purchased a vehicle south of the border saving thousands of $$$ don’t enjoy life?!! - lol! I’m sure they not only ENJOY life - I’m sure they enjoy the extra $$ savings that they’ve keep in their pockets instead of supporting poor self-serving Dealers like yourself.
We all have a voice - you just chose not to use your own Dealer Mao.
June 30th, 2008 at 9:23 am
This dealership, by his admission, has chosen not to import U.S vehicles to sell to Canadian consumers. I’m curious to know what the reason is. No doubt there are Canadian dealers already practicing this and selling U.S vehicles close to Canadian prices…referred to as profit. No one is arguing the fact a dealer is allowed a profit. Just don’t gouge people, that’s all. As well, I think consumers need to be more active and less complacent about Canadian vehicle pricing. If the roles were reversed, I’m not so sure American consumers would roll over as easily as some Canadians. They would express their displeasure with their buying power. They’d shop elsewhere and U.S retailers know it.
Lets look at the fees some Canadian dealers now charge. Most are designed to penalize importers or deter Canadians from buying U.S vehicles. Profit? Gouging? You be the judge. We all have choices. We can whine about prices, or do something about it! Dealers and consumers alike!
June 30th, 2008 at 11:33 am
Alex! Great article you directed us to! Some things, like corporate tactics, don’t change regardless of what side of the border you’re on! Worth reading!!
June 30th, 2008 at 7:49 pm
Thanks for everyone’s responses. I can try and touch on most comments made:
1. Matt Castle.
Matt, I am for real. I never said we had hard time selling cars, why do you assume that? Manufacturers are noticing cross border shopping and are introducing incentives, low rates, and rebates here. It just doesn’t happen overnight. As for refusing to sell cars at “such a marked up price”, I guess you don’t understand that our markups are minimal.
2. sergelbergeron.
I never said it’s not ok for you to do that, this is what I said: “If you want to (buy a vehicle elsewhere) to save a few bucks, by all means go ahead. But don’t blame your BC/local dealer for “ripping you off” or “price gouging”. Once again most dealers have no control over the manufacturers interest rates / rebates / promos. All we have is the room to play with in our profit margin.
And he also said: “complaining will not protect your sales” I wasn’t complaining, most of the posters on here are complaining. I am just providing my point of view.
3. Kirkland Joe.
Dealers will put pressure on the manufacturers if they notice huge sales drop. And trust me, some high end dealers that I know have been doing that. Right now the numbers for many (except the high end luxury brands) won’t warrant that kind of effort. Many new models in fact have similiar or lower starting prices as in the US. For example a 09 Dodge Journey starts at $19995 CDN, vs $19985 US. 09 Corolla is $14565 CND v $15250 US, a Matrix is $15705 CDN vs $16190 US, a Focus is $15995 CDN, vs $14395 US.
4. Pricenator.
I’m not trying to make the consumer seem as the bad guy. I’m just defending myself as many people here try to make me seem like the bad guy, which I’m not.
5. Dana.
Thanks for understanding where I’m coming from, and I also understand your point of view. Yes, I do realize that the money you save you’ll put back into the economy here on other purchases and services.
6. Aloha.
You don’t have to share my point of view. That’s why we have discussions like this, which ultimately can result in solutions that are good foe everyone.
7. Alex.
Alex, I would like to say it does ring a bell( exporting vehicles to the US), but I was not in the car business back then. The Canadian dealers weren’t complaining then, it was the US dealers. So what if dealers, and Canadian consumers alike could export cars down the the US and make money on it? What is wrong with that scenario? You could have done it for all I cared.
8. John.
John, it may seem like nonsense (different cars for different markets) to you, but there are some differences in the vehicles sold here and in the US, and it does cost some money.
10. Manish.
Manish, excellent point, and I am happy that you can improve your quality of life by saving thousands. I was refering to those who spend time and money to hire lawyers, and who want to remortgage their houses to fight import rules. I just see that as a waste of time unless I have a huge financial interest in doing so.
11. John said: “I could care less if GM loses money and shuts down plants… I say GOOD!!!!” John, be careful what you wish for.
12. Robert Lamb posted a link to Jim Kenizie’s view of buying locally instead of from the US. Just because somebody has a different opinion than others here, why does he have to get blasted on like me here? He can choose to spend his money wherever he likes as well including in Canada.
13. Neil Williams.
Neil, I don’t know you, but you don’t see me calling you names like a” professional liar”. There are bad apples in every industry, probably in yours too. I’m sorry if you have run into bad salemen before, as I have run into “liar” customers too who tried to trade in cars with blown trannies, or undeclared accidents. Don’t judge me by your last salesperson, and I won’t judge you by my last customer I had.
If you see an identical car in Florida for $10k less, then what answers are you hoping to hear from your local dealer in reagrds to the price difference?
14. Michael Buffy.
Once again, what is wrong with making profits. Every company has to make profits in order to survive. The company you work for makes a profit too, so that they can pay your salary.
We sell parts made in Canada and USA as well. Yes, some parts available will be from overseas like China, but typically we’ll carry a range of parts varying in price and quality.
And how am I “blatantly deceiving consumers”? Read my examples above and see that some vehicles are less expensive to buy here than in the US.
Once again, some manufacturers are adjusting various prices and rebates, mixed in with low finance and lease rates. It just doesn’t happen overnight.
Good luck with your south of the border shopping (if you choose not to buy in Canada anymore). When it’s time to sell your US vehicles, are you going to sell them south of the border too?
16. Rob W.
Rob, everyone knows that prices in the US are lower for many items, not just for cars. However, not every buyer has the ability, time, or money to be heading south and importing vehicles, or buying other big ticket items. Not everyone has good credit that will allow them to take out a $40-$100k line of credit or loan from their bank. Some prefer leasing too as it’s a tax write off for them, so they end up paying nothing for the car in the long run. Some don’t have the time to do it, or for personal reasons don’t want to. Just because it works for you and a group of others, doesn’t mean it will work for everyone else.
What “excuses and lies” are you refering to that apparently dealers tell their customers? Nobody holds a gun to anyone’s head and makes them buy a vehicle here. Once again, if you think it works for you then go right ahead, but not everyone may be in the same boat as you.
And why would sales drop to zero? The majority of consumers still prefer and do buy locally.
17. Luc Lafrance.
Actually Luc, if the residual value on a lease is less, then the cost of your lease pamyent is more.
18. Michael Buffy.
Michael, if you had two identical cars side by side, one being a Canadian model, one being a US import, for the exact same price, which one would you choose? Buyers prefer to buy local all the time. I’ve been in the car business for 5 years, and out of province, or US vehicles, will always fetch less money than local cars, bought locally from local dealers.
Buyers do want to know where the cars are from, they ask all the time, and we show them full history on them. Not disclosing the fact that a vehicle is out of province, or from the US is against the law. So try not to hide that when reselling yours. The odometer will give it away as well.
Yes we do invest in local economy, actually, donate money and get involved in the local community. Some things we get recongition for, and others we keep anonymous. It won’t matter what I write here as to how much we donate, as most people will think that we’re “liars” anyways, and have pre conceived notions about us.
19. Shane P.
Of course you have to vote with your pocketbooks, and hence there’s tons of local dealers that consumers already pit agsinst each other for lowest pricing.
If we as dealers were to respond to every market fluctuation, there would never be any set MSRP, or standardized pricing for vehicles. We could be adjusting pricing because one province has PST and another one doesn’t (and 1 out of 1000 buyers will buy ina different province). Then we could be doing further adjustments because of US pricing. Then you’d ask manufacturers to adjust rates because bank XOXO has a 0% rate on a G-Car Slowseller XL in color purple on lime green, for 29 months etc….
It doesn’t happen overnight and it’s not as simple as just cutting the prices on the whole inventory. If you had a store, with umbrellas let’s say, that you purchased 6 months ago for $5/each, and are selling them at $6.99/each, would you sell off your entire inventory for below cost if a competitor down the block brought in imported umbrellas for $1.00/each and resold them for $2.99/each? No you’d be trying to make the best of it without losing money by offering incentives, bonuses, etc…
20. Ed said:
How is this my problem and not the consumer’s problem? It will be my problem, if south border shopping makes a significant enough impact on my sales, which it hasn’t by the way. If 10% of my customers think about shopping south, and only about a fifth of those actually do (so 2% of my customers), that is their perogative. That’s not enough impact for me to cut my prices and sell of everything at a loss.
If you as a consumer have trouble with all the regulations because you want to save money, then YOU put in the effort to do it and it becomes YOUR problem. Saving money will cost you in expenses and time. Don’t expect to get something in return for nothing, and don’t expect someone else to do it for you.
Where do you take your truck for servicing? Back to the US? Doubt it. I can’t see how going the extra step for a loyal customer would push customers away. It brings them in.
21. John.
That rule (customer is always right) does hold weight with us. But that goes to customers who buy from me. That’s who I am serving. You may be a potential customer, and just because you’re right about one thing, does not make you an expert in my field of work.
22. haditiwthcdnpricing.
Thanks for considering it (buying US cars from local dealers) but dealers that have done that are met with negative comments from customers, that they’re trying to make a quick buck, or profit off their backs in this whole situation.
23. cinqhoda.
No, I won’t turn away any customer. It seems as other dealers have and it’s going to hurt them. I will never turn away business, nor will I have a lower set of standards for customers who bought elsewhere. I will however always go out of my way for loyal customers who have been with me for years.
24. Franco J.
No need for the name calling Franco. If you’re lacking in vocabulary that you need to call me a communist, then maybe you should brush up on it. Did you take up the offer and make some extra money for yourself exporting cars? If yes, then what’s the problem, if no why not?
Yes, everyone enjoys saving money. Are dealers self serving? We serve our customers, our communities, and ourselves. If we don’t serve either one of those we’d be out of business. Every business has to serve those 3 areas.
You want the Walmart concept? Everyone working for minimum wage, selling cheap low quality goods, made overseas by below minimum wage workers? Which side are you willing to hop on? The side making the goods, or the side selling them? I have a feeling that you’re somewhere in that scenario, but it doesn’t mean you have to drag everyone else there.
25. Don O’Connor.
We don’t import US vehicles because we prefer to have local cars with known histories behind them. There are tons of gung-ho brokers down south who are offloading junk that some Canadians are willing to buy (for the sake of saving a buck). We’re not interested in that. Plus on some cars the warranties are an issue, and it’s choice we made to keep it simple for the consumers. Usually those dealers that do import from the US and resell them here, usually do it for less money than a comparable Canadian model. But if a customer is willing to pay same price for a US car vs Canadian car, then that’s their choice. Dealers, and pretty much any business will charge what the market will bear.
As for the fees some dealers charge, I can’t speak for us, as we don’t “gouge” consumers. There are many places that do inspections for various fees, and once again consumers can vote with their pocketbooks as to where they want the inspections done. Same goes for car manufacturers with restrictive import policies. If you don’t like it then buy another brand. Simple as that.
—————————–
Thanks for everyone’s comments. Once again good luck with Transport Canada. Don’t forget to inspect your vehicles (so you don’t end up with an ex-Katrina flood cars, rebuilts, or expensive garage ornaments) and make sure they’re admissable. Better yet, visit your local dealer, as there are some good Canadian deals to be had right now.
June 30th, 2008 at 10:31 pm
Alot of feedback to the comments Sebastian (Mr. Dealer), and a lot of hard work on your part, you are just as passionate as we are. I guess that is normal … you are doing this to try and make a living..
I will leave the rebuttals to our members and supporters. Right now they are most likely out enjoying the long holiday week-end with their families. Those that have purchased vehicles in the U.S. are probably out spending their savings on improving their life styles.
We are not disputing that some Manufacturers have lowered prices on entry level models.. such as the Journey from Dodge.. but we really recommend that Canadians do their due diligence and make sure they are comparing apples to apples..
There is a 20 to 40% difference on mid to upper priced vehicles.
Concerning Mr. Kenzie’s comments… lets remember that he is a media type / reporter and should be looking at both sides of the story. He should be encouraging Canadians to do their homework. If you listen to the facts he presents you will get a pretty good idea that he did not do his homework before embarrassing himself on TV.
To bad you had to spoil it with the threats in the last paragraph.
Let the debate Continue…
All Canadians want is Fair Pricing!
please check out the forum… we will have a poll on wether or not we should move over there on July 5 when the comments close. To bad we couldn’t get some more dealers adding to the mix.
June 30th, 2008 at 11:13 pm
16. First of all, I appreciate you taking the time to respond to everyone’s comments. I have nothing against Canadian dealers because I know that they’re just trying to make a living like everyone else. With the pricing issue, their hands are basically tied due to the car manufacturers.
I know that not everyone cares to go to the effort of importing and can satisfy the “cash purchase” requirements when doing so. My problem is that most of the car companies, with the help of the RIV’s admissibility list, have put up trade barriers preventing people from importing. ie. not allowing their U.S. dealers to sell to Canadians, voiding the warranty, charging outrageous recall letter and unnecessary retrofit fees. By restricting open market competition in this way they artificially keep price high by forcing Canadians to either a)buy locally at the high price b)import and minimize savings due to fees. Open market competition would drive prices down and benefit all Canadians including those that would not qualify for importing (ie. finance and lease customers).
By “excuses and lies”, I mean stuff like, “Canada has a higher minimum wage and universal healthcare so that’s why the car costs 40% more here.”
If enough Canadians understood the facts then as a consumer protest we could refrain from buying for a few months and bring sales to zero. It sort of happened a bit in March when BMW Canada’s sales dropped by 25%.
July 1st, 2008 at 12:32 am
Sebastion(Mr Dealer)
I am all for profit in Business. Just not gouging. When manufacturers allow their dealers start to add extra costs for inspecting a vehicle, that’s when I get upset. The article I showed indicated that this was not a Canadian problem, but a North American problem. Before the dollar went up, importing cars was a little easier. Now manufacturers are forcing their hand on dealer and consumer alike. I’m not looking to buy new (I have 2 vehicles -I bought new here in Canada and negotiated a fair price for= 03 Grand Caravan and 06 Pontiac Torrent), but I am looking to buy used. A higher end, closed to being out of warranty luxury car. Lets just say a 2004 Mercedes SL600 priced at around $50000 US. In Canada that same car, if I can find one, would cost upwards of $85000. In the meantime Mercedes has decided that to slow me down from buying a good cheaper used car as they would charge me anywhere from $8000-10000 to have it modified to Canadian specs ie bumper. Now is this reasonable. The car has suffered no collision damage. There are just replacing some foam for crying out loud.
I have a very good friend in the automotive business(He owns the Gm dealership where I bought my Pontiac)and he was around when the times were good in 2003. We have talked about this very scenario. He shipped new and used vehicles to the United States for a profit and never complained. In the last couple of years since the dollar has risen, he like any good business person has imported cheaper high end cars. He also looks forward to the end of the bumper reg, because that little piece of legislation cuts into his profit. He also realizes that consumers when they purchase outside his neck of the woods, may end of having their vehicle serviced at his dealership. Once again he is happy, because like you say there is not a big profit in the sale of new cars. There sure is in servicing them (I think the shop rate is about $80-90 dollars a hour).
You say weren’t in the business then (2003) , but you are now. Well it sounds to me like you are closed minded about where consumers purchase their vehicles, and servicing them.
My friend the dealer has his ups and downs, but I like him because he treats me good no matter where I buy my car. He knows that when that warranty expires and I need a place to service my vehicle he’ll be waiting with open arms and a smile as I open my wallet to spend. You see he’s been around the auto business all his life and he knows how to make a profit.
July 1st, 2008 at 10:10 am
This dealership owner seems to think that it is a lot of work to purchase a vehicle in the US. It may have been more difficult back in September/07 to December/07 but it sure is not that difficult now.
Since my brother purchases his new truck in the US in Sept/07, my niece purchased one there in Dec/07 and I purchased my new truck in the US in Jan/08. Since then I have convinced two friends and my son to compare pricing on the vehicles that they wanted to buy. In all three cases, they purchased in the US. Each friend and my son saved in the range of $8,000 to $10,000, even after upgrading the vehicles to better models. All three could not believe how simple the process was. Numerous other friends have contacted me to ask about the process and have indicated they intend to buy their next vehicle in the US if the pricing is not equivelent in Canada when they are ready to buy. I don’t think this dealer or others realize yet that the tide is turning in favour of buying in the US.
No, I don’t take my new truck to the US for servicing. I use my local qualified mechanic. I will not even consider going to the local dealership because of their attitude toward US buyers. If I have a warranty issue, even though my warranty is good here in Canada, and I encounter any negative feedback from the local dealer, I will gladly take the vehicle on a trip across the border to a US dealer. It will give me another opportunity to check out the US market.
This dealer thinks that US buyers only result in a loss of perhaps 2% of his business.He is not really concerned at this point that he is losing business. If he received better pricing from his manufacturer, how much more successful would his dealership and his sales staff be.
It was never suggested that he should lower his prices and sell his inventory at a loss.Put some effort into organizing your specific type of dealership, lobby for better purchase pricing from your manufacturer to be competitive with the US. Retain that 2% of your customer base that is buying in the US and possibly increse your customer base by 5% by attracting those customers that are willing to spend an extra few hours to save thousands of dollars by buying in the US.
July 2nd, 2008 at 8:09 am
this is tally bull s***.
But I tally do agree with mr.Serge Bergeron’s comment.
Is it really OK you sales person make more money?
But it is NOT OK we consumers save more money.
I bought a 2006 accord se in 2006. at that time i did not know about price difference
betwwen borders.
Now I know about it and I will never buy another vehicle from canadian dealer
July 3rd, 2008 at 3:55 pm
It’s idealogical crap. His problem should be with the gauging manufacturers, not Canadians trying to get a fair deal. Protecting local industries with inflated prices and regulations is inefficient and ends up reducing Canadians quality of life, because we spend more of our disposable income on propping up Canadian distributors - and why do we need them at all??? Break down the regulations at the borders and give Canadians access to the buying power of the US public….and not just for cars for everything, telecommunications, groceries, consumer goods, and services…
what we need here more than anything is competition.