Jump to content

Car Prices


GDR
 Share

Recommended Posts

I've just been comparing prices of new cars bought in Canada and comparing them to American prices. For a $30,000.00 car with most of the bells and whistles the price is something over 5000.00 more in Canada which includes $1000.00 more for that rip off they call delivery charges, PDI or whatever.

Just compare the cost of a car like the Chev Equinox, (which they proudly advertise here as being built in Canada), in Toronto and compare it to what you pay in Buffalo. The difference is over 5000.00.

Why is it that we put with this?

Link to comment
Share on other sites

I've just been comparing prices of new cars bought in Canada and comparing them to American prices. For a $30,000.00 car with most of the bells and whistles the price is something over 5000.00 more in Canada which includes $1000.00 more for that rip off they call delivery charges, PDI or whatever.

Just compare the cost of a car like the Chev Equinox, (which they proudly advertise here as being built in Canada), in Toronto and compare it to what you pay in Buffalo. The difference is over 5000.00.

Why is it that we put with this?

An older Internet story with an explanation...of sorts..

What's going on here?

The answer has to do with leasing: Lower prices might boost new-car sales in Canada, but that is not, right now, in the interest of the manufacturers which own big chunks of the leasing corporations.

Each year in Canada more than half of all new vehicles going through dealers are leased, rather than sold. If, on average, cars lose half their value over a three-year leasing period, then the value of a $40,000 car, after a three-year lease, will be $20,000. This $20,000 is an asset on the books of the leasing company.

Now, if the $40,000 new-car price were reduced in Canada to the U.S. level of $33,300, then the buy-back value after three years would be only $16,650.

Between 2004 and 2006, Statistics Canada data say 1.5 million light vehicles were sold in Canada each year: 800,000 cars, 200,000 SUVs and 500,000 light trucks. If half of these are on lease, there might be 2.25 million outstanding leases. If each of these leases/assets were to take a $2,000 hit (assuming the average retail overpricing is only $4,000) then parity in pricing would be almost a $5 billion loss on the balance sheets of leasing companies. Obviously, lease owners have an interest in continued high prices.

How will this market evolve in the coming months? First, some cracks are showing in price maintenance. Suppliers with a small market share in Canada (Subaru for instance) and a growing market (i.e. contented dealerships) seem to place no barriers to Canadians buying in the U.S.

Second, there is a real possibility of a major slowdown in Canadian sales. Once a critical number of Canadians purchase in the U.S., reputation and network effects will become important, and the Canadian retail car market could slide disastrously.

Our prediction is that competitive pressures will bring Canadian prices down to U.S. levels in the not-too-distant future. If not, it seems to us that the Competition Bureau should step up to the plate and bat for the Canadian consumer without delay. That is why the Bureau exists.

Link to comment
Share on other sites

But the Cdn dollar has been roughly at par or above for a good long time now. What you posted mentioned Subaru but the for the warranty work done in Canada you have to pay the dealer and then apply to have it paid back by Subaru in the US.

And again, the delivery etc is 1000 more to ship an Equinox from Oshawa to the dealer in Oshawa than it is to San Diego.

Link to comment
Share on other sites

I agree with that. It doesn't make sense to me either. It seems to me that we pay more in Canada just because we will. If Canadians got together and hung on to their old cars for an extra year we would have prices the same as the Yanks, but it ain't about to happen so we will just go on being gouged.

Link to comment
Share on other sites

I know more and more people that are buying their cars in the US and importing them. It is so easy now its rediculous. Many US dealers will send the paperwork to the border for you.

Link to comment
Share on other sites

Almost everything is more expensive in Canada. I buy all of my gas in the US. I buy 40% of my groceries in the US. I buy quite a bit of electronics, clothing, and my kids toys in the US. My next car will be bought from the US.

Link to comment
Share on other sites

Almost everything is more expensive in Canada. I buy all of my gas in the US. I buy 40% of my groceries in the US. I buy quite a bit of electronics, clothing, and my kids toys in the US. My next car will be bought from the US.

Don't complain about people crossing the border to fly Allegiant :)

Link to comment
Share on other sites

The main reason airline fares are higher is largely due to taxes and other costs that are outside the control of the airlines. We are talking about a car built in Canada and being sold in Canada costs close to 20% more in Canada than in the Excited States, before taxes are applied.

  • Like 1
Link to comment
Share on other sites

Almost everything is more expensive in Canada. I buy all of my gas in the US. I buy 40% of my groceries in the US. I buy quite a bit of electronics, clothing, and my kids toys in the US. My next car will be bought from the US.

Just wondering, do you fly out of Bellingham too? Is it cheaper than YVR or YXX? I know lots of BC border folk do, some even go to SEA. Hey everyone loves a deal,

:cool: :cool: :cool:

Edited by manwest
Link to comment
Share on other sites

Yes there is so many price differences from the USA and Canada. Maybe part of of it volume sales, population of USA 400m plus Canada 35 m. Gas is cheaper or at par in socal, booze at Vons (Safeway) in socal ,,,, texas mickey $19 us with Safeway Club Card here 750 mil is $26, go figure. mmmmm Vodka mmmmm............

:cool: :cool: :cool:

Link to comment
Share on other sites

I buy all my stuff online and have it shipped to my US address,most shipping is free ,even if you have to pay shipping its still cheaper

After all my stuff has arrived I go for a drive ,use my NEXUS to cross the border,do the rest of my shopping ,pick up my stuff and fill up with good ol SUNOCO fuel.

Make a day trip and save some $$$$$

We are also going to look at a new truck in the states,I have bought used cars in the states and drove them back with not much hassle

Just have your paperwork in order before you get to the border.US officials are sticky about paperwork

Link to comment
Share on other sites

Just wondering, do you fly out of Bellingham too? Is it cheaper than YVR or YXX? I know lots of BC border folk do, some even go to SEA. Hey everyone loves a deal,

I haven't crossed the border to fly in about 6 years.

Link to comment
Share on other sites

Almost everything is more expensive in Canada. I buy all of my gas in the US. I buy 40% of my groceries in the US. I buy quite a bit of electronics, clothing, and my kids toys in the US. My next car will be bought from the US.

Yup, and I'd be willing to bet that all the while you're not in the USA buying crap that you're complaining about how much income tax you pay too.

Edited by seeker
  • Like 1
Link to comment
Share on other sites

Got a problem with how and where I spend my money?

Well, yeah actually. Not just you CE, wouldn't want you to feel that I'd singled you out or anything like that. I do have a problem with cross-border shopping. Especially irksome for me are people who brag about the money they spend outside the country. Have a look at the wikipedia page if you need help understanding why this bothers some of us: http://en.wikipedia.org/wiki/Free_rider_problem

Link to comment
Share on other sites

CE, I am sure, SOES pay his taxes on his income and in many other ways. He is free to spend whatever is left in any way (or country) he sees fit. If he happens to save a bit of money in doing so then whats the issue. Prices for most goods and services are already artificially inflated whic is why people shop in the US. When exactly the same product from exactly the same company is upwards of 20% less(before Tax) in the US than in Canada there is a problem.

A Director at Kawasaki was asked why motorcycels were more expensive in Canada compared to the US and his response "Because Canadians will pay it". Not a particularily good answer but the correct one. Why should we pay it. If I can drive an hour and save enough to make it worth while then why shouldnt I? Why should I be gouged just because I am Canadian. Remember too that this is BEFORE Tax. Tack on the 13% HST in Ontario and the disparity grows even further.

What these manufacturers and retailers need to understand is that there is profit in selling VOLUME at a lower price as opposed to selling less at a higher price. Lower the prices and the people will shop at home. It really IS that simple.

I will research a purchase and get wherever I can get for the lowest overall cost.

I did some research last week, I need a new rear tire for my bike. I can buy it from the US for much cheaper than in canda but I have to ship it and pay Duty and GST on it. Then I have to find an installer who will install a tire I didnt buy from him. Overall difference between buying here and in the US was $8.00. YUP $8.00. In this instance the $8.00 is the cost of having it TODAY instead of next week.

I shop where I get the best deal PERIOD.

Link to comment
Share on other sites

One has to be careful buying certain new vehicles in the US.

BMW Canada, for example, won't do any warranty work on a new BMW purchased in the US, even after they are paid quite handsomely for the "compliance letter" which allows the vehicle to be imported legally into Canada.

After 12 years of loyal ownership with I can't quite remember how many high end BMW's purchased, I'm done with them. Horrible customer service.

I'll stick with a company that wants my business in the future.

Link to comment
Share on other sites

Well, yeah actually. Not just you CE, wouldn't want you to feel that I'd singled you out or anything like that. I do have a problem with cross-border shopping. Especially irksome for me are people who brag about the money they spend outside the country. Have a look at the wikipedia page if you need help understanding why this bothers some of us: http://en.wikipedia....e_rider_problem

Maybe you make enough money to buy what you want for whatever it costs. Maybe you don't need the extras that some do. Maybe you are so far in debt you don't care - whatever it is it's none of my business and I wouldn't hold it against you.

I save around $120-$140/month buying gas in the US.

I just saved $450 buying speakers for my home theatre in the US.

I saved $42 ($78 in Canada/$36 in the US) buying a toy for my son in the US.

Big or small, it all adds up. When the government has their hand on everything I need to buy I'll spend my money where I get the best bang for my buck. Whether its in Canada or the US it doesn't matter to me.

Link to comment
Share on other sites

I can't blame anyone for shopping in the US. Bottom line is, Canada has priced itself out of the market. The only way to vote is with your feet.

Great article here today in the Globe that points out why today's generation of earners may 'need' to bargain hunt rather than want to:

http://www.theglobeandmail.com/globe-investor/personal-finance/2012-vs-1984-young-adults-really-do-have-it-harder-today/article2425558/

Add to this the recent change in OAS from 65-67 years old (just another way of taxing the young)... how many more things will be taken away to float the boomers through the medical system and not bankrupt their grandkids?

Add to the fact that I work in aviation... and I think I'll invest wisely while saving money where I can thanks. If that means supporting our largest trading partner then I guess I will have to live with that.

Link to comment
Share on other sites

I can't blame anyone for shopping in the US. Bottom line is, Canada has priced itself out of the market.

Do you also encourage people to drive to US airports to take American air carriers?

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

 Share

×
×
  • Create New...