Canadians Import 24,873 Cars in October
Thanks to the parity between the Canadian loonie and U.S. greenback– and carmakers' failure to lower their Canadian prices to compensate– our neighbors to the north are flocking south to buy new and used vehicles from American car dealers. The Toronto Star finally puts numbers to the trend: Canadian cross-border shoppers imported 24,873 cars in October. That's double the previous month's total (12,289). It seems the trade is having a ripple effect on the entire industry, as savvy buyers wait for automotive prices to drop. To wit: Canadian new car sales declined from August's 158,394 to October's 121k. The toll on "domestic" used cars could be even heavier. However, as we've reported, the entire trade has just fallen afoul of federal regulations requiring Canadian-spec, manufacturer-approved, anti-theft immobilizers. With over a thousand imported cars in limbo, the resulting confusion and outrage is certain to create some major political blowback– especially with as Transport Canada admits some of those cars may have been purchased between Sept. 1, when the new regulation came into effect, and the time when the agency posted the list of prohibited vehicles on its website. Oops.
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When I was living in Canada, the Loonie was 80 cents. Even at that time, many of the makes were pricing cars as if the Loonie were still at 60 cents. I had a dealer call me up about a new plane and start threatening to import it from the states before he even compared prices. I told him we would offer a discount, and that we were competitive with the US dealers. He was so sure I was just full of it. I suppose since his business worked that way, he thought ours did as well.
The GST (sales tax) goes from 6% to 5% on January 1. On my last look, I priced out a new Honda Accord EX-L V6 at $39,000CDN (excl Taxes) in Canada and $30,000 US. Sooner or later, the pricing will be adjusted or the car companies in Canada will just have to close up shop. Not a good time to be buying new cars in Canada right now.
I'm glad to see new car sales falling in Canada. The only power we have in a (semi) free market is by exercising our discretion in how we spend our money. If I was a manufacturer and consumers were still buying my product at a 20%-35% premium over the same product in the US I wouldn't drop my price either.
Yes we have to get the word out and tell your brother/mother/friends to not buy a new car in Canada until we get fair pricing, because while we keep paying the over-inflated prices that is all we will get. The companies like Porsche should be doubly boycotted for insulting our intelligence, they issued PR about dropping prices, but it was merely a token amount. We are still looking at $15 000 difference on the cheapest Porsche Boxster. When I replace my car I won't pay unfair pricing. Unless we have fair pricing, I will go far enough south to find a dealer who will sell to me, I will do without warranty. Whatever it takes, the number one way we straighten this out is to hang tough and take our dollars elsewhere. Only when the balance sheets bleed deep crimson will they finally start to offer fair pricing. Do your patriotic Canadian duty, buy in America!