Monthly Archives: September 2008

US Canadian Auto Price Differences – Why is this so ?

It has been a long while since the US dollar was anywhere near its level now.  True it was parity not long ago – a dollar was a dollar .  One Canadian dollar was equal to the US greenback.  Still even at current levels October 2008 Canadians have little to complain about .  Is it still worth it to import an American vehicle back into Canada with the change in the dollar currency rates ?  On top of that Canadian dealers are offering large incentives to purchase locally.

Still the differences between US and Canadian models are still significant.  You can judge that on the manufacturer’s websites even though to some degree this has been camouflaged , made harder to judge and in some cases even hidden.  It seems that even if you go onto the lot yourself to judge numbers it can be downright difficult if not impossible to get a fix.  Its amazing how something so clearly posted isn’t. In the end you may have to go inside “to talk to someone”  and get an initial estimate of the price of that new car.

Why are prices so high in Canada ?  In many cases often the car , truck or SUV itself is built in Canada under Nafta rules.  Nafta stands for North American Free Trade Zone you reason .  It should be cheaper here you might think – outside of taxes which you will have to pay anyways – GST and PST provincial sales taxes which you are going to have pay regardless.  The car does not have to be shipped as far , or involve additional shipping and customs fees so why is this all so ?

Some of the reasons may be that the cars , although made in Canada , include additional expensive equipment that is standard in Canada but not for the US.  These components are added to the cars manufacturing and retail costs.  For example according to Toyota – that although the US sold Matrix or Corolla model may appear the same , and made in Concord / Cambridge Ontario the Canadian models have heavy duty heaters , batteries and alternators.  In addition weather stripping and seals have to be more robust for Canadian models as opposed to US and Mexico export models.

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