Over-the-Border Car Shoppers and Opportunistic Auto Brokers Attracted by Discounted Canadian Cars
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| Canada and the USA are each other's largest business partners. Every day of the year, about $1.5 billion dollars in trade crosses the Canada-U.S. Border; that is well over a million dollars a minute. (Photo: CanadaFocus.com) |
Consider this; Canada has the lowest rates on CD's as well as sunglasses, therefore, many people south of the border come to Canada to purchase such goods. Lower prices on everyday-goods are generally offered due to higher taxes, lower after-tax incomes, and higher importation costs because of the feeble dollar.
Then why have lawsuits been recently filed against multiple automakers? Because American consumers feel that they are being discriminated against. Many over-the-border car buyers are attracted to the near 30 percent discount they receive when purchasing a vehicle in Canada. The wave of American buyers in the Canadian market is largely due to their very favorable currency.
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| DaimlerChrysler's Mercede-Benz brand is a popular model for exportation. (Photo: Mercedes-Benz) |
At the heart of the problem U.S. consumers believe that top German, Japanese, and American automakers are purposely refusing warranties to foreign 'gray market' purchasers. Furthermore, allegations have been made that Canadian dealerships are being punished for selling new trucks and cars to the American market.
Included in the defendants list are the following companies: Ford Motor Co., DaimlerChrysler AG, General Motors, Honda Motor Co. Ltd., Toyota Motor Crop., BMW AG, Nissan Motor Corp., as well as the American and Canadian automobile dealers association. According to Reuters, GM, Ford, DaimlerChrysler and the respective dealer associations didn't return reporter's phone calls, therefore, chose not to comment on the allegations.