Leasing Companies Sue Mercedes, BMW, and the Canadian Government

Frank Williams
by Frank Williams
leasing companies sue mercedes bmw and the canadian government

Two leasing companies are taking issue with Canada's restrictions on importing vehicles from the U.S. Globe and Mail reports Fournier Leasing and Canadian Auto Associates have filed a class-action lawsuit against Transport Canada and the Canada Border Services Agency alleging they're part of a conspiracy to keep vehicle prices high. BMW Canada, Mercedes-Benz Canada and Mercedes-Benz USA are also named in the suit. The leasing companies claim Canadian import requirements reduce competition and raise prices 20 to 35 percent above similar U.S. models. They also say government restrictions on importers add additional costs. M-B Canada had no comment. BMW Canada said they weren't aware of the lawsuit, which seeks damages in excess of $1b.

Join the conversation
4 of 15 comments
  • AGR AGR on Feb 28, 2008

    Brendon, I would conclude that legally a Canadian is permitted to import a vehicle from the US and if its less than 15 years old it must go through the RIV process. If the RIV process is modified and tweaked that a Canadian consumer could be left in "limbo" with a vehicle since the requirements were altered in mid process...who is to blame. If a Canadian cannot avail himself or is discouraged of the opportunity to save money on a vehicle since certain manufacturers create requirements that become moving targets...is it fair. Does Levi stop a Canadian from buying jeans in the US? Does Bombardier stop a Canadian or place unreasonable hurdles to buy a jet in the US? I'm sure that planes have to meet stringent safety regulations. For years the RIV guidelines were static, now there are constant updates, accompanied by warnings to the consumer. If Transport Canada changes their mind every second week with their RIV guidelines, are they enduring the safety and well being of Canadians?

  • CSJohnston CSJohnston on Feb 28, 2008

    AGR, Agree to disagree then. However, the vehicles independents and leasing companies exported South did indeed originate in Canada from Canadian sources, however now these same entities want to import units into Canada that while beneficial to consumers hurt Canadian Business. Businesses that as you say have invested in Canadian bricks and mortar, employ a lot of Canadian workers and pay a great deal of Canadian taxes. As for the consumer, how many of these BMW and Mercedes customers using leasing companies and independent dealers are themselves protected by Canadian trade or legislative barriers against competition? Lawyers? Doctors? Bankers? Investors? Executives at companies like CP Rail and Air Canada? Maybe a truly free and fair exchange should apply across all industries.

  • NRI905 NRI905 on Feb 29, 2008

    A small dealer's perspective. I import for sale and lease pre-owned US vehicles. I also import occasionaly a new vehicle. I've been in business since the 70's. I applaud the efforts of these 2 dealers/leasing companies. Why is it that other manufacturers allow the free movement of vehicles between our 2 great nations, but these 2 manufacturers do not? GM, Ford, Toyota etc freely supply the buyer the required recall information. Honda gives RIV complete access to the needed info via the internet - you don't even need a letter. The answer is: It's all about money and nothing else. These 2 auto manufacturers mentioned in the suit only care about money. Whether that means keeping their resale values higher - to justify the higher new vehicle prices. Or, whether its because they want to regain some of the lost revenue from not selling a "Canadian" vehicle. I wouldn't be suprised if I hear that RIV was getting a kickback from BMW and Benz for enforcing this excessive and unnessasary charge.

  • Yfb Yfb on Mar 06, 2008

    I am reading these replies with interest. In respect to the two companies, no matter what their motive I applaud their move. Canadians have been treated second class by automakers for a long time and the dollar parity has made this more evident. In particular BMW and Mercedes are overcharging for their products in Canada. We just bought an ML350 in Canada, we could have saved at least 20% on it in the US, but decided the hassle was not worth it. We are paying 20% more for a vehicle built in the same plant as a US model. The plant is in the US. One could say that they are protecting their dealers and the US market is much larger. Mercedes dealers are not found in small towns but in big cities with markets comparable or better than in the US. In Vancouver, there are no independent Mercedes dealers, just corporate ones. I would guess that their costs are no different than a Mercedes dealer in Seattle, except in Seattle it is an independent dealer who carries many lines of vehicles and not just Mercedes. We Canadians are sheep basically. We should have bought a Toyota in the US and just driven it across. The ML belongs to my wife. My next car will be used from the US. If Walmart USA refused to sell something to someone because they were a Canadian resident everyone would be upset. We have been paying 20%-30% too much for the same car and are forced to and no one cares, but maybe that will change with this lawsuit. good for them.