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Importing Canadian Vehicles to the U.S.

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Comments

  • People tend to believe what they want to...

    You are right. Its just like I had that 98 Corolla... 86Kish miles (Was in KMs). A clean 98 5-speed.

    Couldne get $4,500 for it retail!

    Bill
  • dustidusti Posts: 36
    here's what I believe.

    Present money is worth more than future money. Whether the money is blown or invested is beside the point.

    Manufacturer's ALLEGEDLY don't honor the warranties not because they split themselves up into different national entities and quite rationally and logically don't honor each other's "different" cars ..

    but because they quite rationally and logically are in business to make a profit and it's in their interest to put up all the roadblocks possible to keep their profitable market from getting its hands on their products through means that won't give them one.

    Canadian cars AREN'T grey market cars. There are no modifications not under the manufacturers' control that would present a rational reason not to honor the warranties.

    I say allegedly because there is such a thing as an implied warranty. The product is required to perform its basic function - period.

    If Canadian vehicles are such dogs in the market that the loss in value upon resell is greater than the money initially saved taking into account present money calculations...

    And this is a BIG if.

    Then the American public must have some real phobia against kilometers.

    And USED Canadian vehicles must be one heck of a bargain.

    Buy one and drive it until the wheels rot. The car won't have this phobia.
  • landru2landru2 Posts: 638
    It's great that you BELIEVE all that. Tell us what you KNOW and we'll have something.
  • godeacs:

    You're right that in most instances, folks won't come back from Canada with a new car and the next day write a big check to Vanguard for $5K. Instead, if they're buying with cash, they'll withdraw $5K less from what they've already got at Vanguard than they otherwise would have.

    Alternatively, if they're borrowing, they'll take out a loan with $5K less in principal. However the end result is the same: the upfront savings *grows* over time.

    $25K for 48 months @ 6.0% => $28182 total outlay
    $20K for 48 months @ 6.0% => $22546 total outlay
    difference is $5636.

    In a practical sense, either case represents *investing*.
  • sonjaabsonjaab Posts: 1,057
    Bring that TOY up here to ALexandria Bay
    NY.........Crazy money !!!!
  • godeacsgodeacs Posts: 481
    Excellent summary and you're right on IF someone does that. Guess my pt was that say someone was gonna spend $26K on you new car, then finds out they can get it for $22K in Canada. So...they go thru the gyration (and expense) of importing from Canada and say, "hey, I just saved almost $4K from that trip to Toronto". Let's take that $$$ and take a vacation, buy a second car, remodel the house, etc..."

    So much for investing the difference!

    Also, guess I'm still skeptical - if bringing a car in from Canada was THAT good a deal, there'd be companies lined up at the borders providing that service....lol
  • gerapaugerapau Posts: 211
    The reason that companies are not lined up at the borders providing the service is because most manufacturers either do not allow buying in Canada or make it less attractive to either the purchaser (Honda and others by not honoring the Canadian warranty) or the seller (Ford and others by charging a penalty to the Canadian dealer for knowingly selling to Americans). Those manufacturers that do (Nissan/Infiniti)allow Americans to buy their cars in Canada would probably change their tune if a large number of people started buying in Canada. American dealers would start complaining and the manufacturer would put an end to it.

    Also, I do believe that any company that would set up shop and try to sell Canadian cars in the U.S. would have to sell them as used (the only way to buy a new Canadian car is through a Canadian dealer) and thus would not be as profitable.

    What it comes down to, is who you believe. On one side we have actual buyers who have made the trip north and have saved significant amounts of money and on the other side we have those that believe that these cars will lose any potential savings when the cars are resold. As others have said already though, if you do keep your cars for a long time buying in Canada may save you a lot of dollars. To everyone, I would advise you to contact your DMV before making the decision to buy in Canada. That way you can make sure that you will not end up regretting your decision.

    All this said though, some bargains are almost too good to pass on. One example appears to be the new Infiniti G35. Canadian prices have just been released and they appear to be much cheaper then in the U.S. The Canadian G35 with Premium package has a MSRP of CA$41,500 or about US$26,100. The American model with the same options is the G35 Luxury Leather model with Premium Package (with Winter Pakage, Power Sunroof, Xenon headlights and Wood Trim) and has a MSRP of US$33,580. Now, it is hard to compare all options, since the Canadian Infiniti web site doesn't have the specs for the different models yet, but all of the major options are the same (leather, sunroof, BOSE, Xenon, etc...). At a difference of about US$7,500 it should pay (even in the long term) to make that trip north.
  • rroyce10rroyce10 Posts: 9,359
    ...... So, what happens when you go to trade that G35 in the next 2/3 years ..and the vehicle is worth $10 LARGE less ...?

    Call the DMV ...?

    Terry.
  • gerapaugerapau Posts: 211
    rroyce10: Do you actually believe that the car will be worth $10,000 less? If you do then you are fooling yourself.

    I know people that are/were involved in the used car business here in Canada. Starting a couple of years ago the used car prices started jumping up substantially at the auctions north of the border. There were/are two main reasons for this; American dealers coming to Canadian auctions and driving up the prices and Canadian leasing companies taking their lease returns directly to the U.S. to sell at American auctions (thus reducing the numbers available in Canada). I talked directly to one of the people that were involved in taking a shipment of Chrysler lease returns to an auction in N.Y. state. According to him, it was much more profitable to sell their cars in the U.S. then in Canada. He told me that he would have no trouble selling the entire shipment (more then 500 cars) that they were taking to the U.S. that day. I doubt very much that this would be the case if, as you have been telling us, the Canadian cars were worth so little in the U.S.

    You have stated yourself that you have seen thousands of Canadian cars go through the auctions that you have attended. The majority of these (late model cars) are probably from Canadian leasing companies. You have also stated that these cars usually go for half of the normal value. Do you believe that these leasing companies are taking their cars to the states to lose money? Used car prices in Canada are currently slightly less then in the U.S. but if the leasing companies could only get half the going rate in the U.S. then I doubt that you would see many Canadian cars at all. Wouldn't it be much more profitable to keep their cars in Canada? I will agree with you that the Canadian car will probably be worth less in 2-3 years. But definately not $10,000 less, nor $7,500 less.

    As far as calling the DMV (department of motor vehicals or whatever it is called in your state) is concerned, if someone is concerned that their vehical will possibly be branded TMU they should be able to find out for sure from their DMV.
  • audia8qaudia8q Posts: 3,138
    Have you ever noticed that alot of people can justify anything without letting the facts stand in their way...haha

    rich
  • rroyce10rroyce10 Posts: 9,359
    I don't think I will spend much more time with this subject, just based on your statements.

    My friend .. it's your money, not mine. The only reason why I entered this topic was to help to clarify some "Urban Legends".

    People like Audi, Bill and myself don't make a dime if you buy a Canadian/American/British or a Bulgarian vehicle .. it has nothing to do with us.

    The subject is predicated on, is there a value .. IF you buy a Canadian vehicle.

    And the answer is .. yes. You will save money upfront -- But the bad news is .. you will loose it at the end, at trade time. It's simple, that's the market ..and has been the market for as long as I have been in it, which next month will be 18yrs.

    You just stated: *Do you believe that these leasing companies are taking their cars to the states to lose money?*

    Aaah Yeah ..! I go to tons of auctions, I see em' everyday. Do you realize that ALL leasing Co's. loose $$ at the auctions ..? A vehicle has a residual of let's say $12 .. they run 200 units through, and on the average they might do $9,8/$10,2/$10,400 depending on the miles, condition, etc. ... that's what the market will bear. And that's whether it's a Cavalier or a Benz.

    This whole thing of: I can "steal" a 02 Lesabre/Chevy truck/Lincoln LS or a whatever .. is exactly what happened in the late 80's and the early 90's when everyone was "hell bent" to get a gray market Bimmer, Volvo, Benz, etc. They had the vehicles brought in .. did the $2,500+ conversion waited 2/3 months at the docks --- and when it was all done -- they saved $5/$7/$9,000+.

    But, the sad part for them was ... when they went to trade -- it was worth 60cts on the dollar. So here sat the Jag/Benz/Volvo/BMW buyers --- Is that some kind of Savings ..? Maybe on your planet it is.

    Look, right now everything looks peachy keen. But as the 12 months turn to 24 months, and 24 months turn into 36 months, these owners will be turning into new buyers -- ready to trade in this real nice vehicle, that they listened to "ALL" these sales people, that are doing ONE thing -- and that's to sell you a Canadian vehicle (and make a sizable commission) .. with of course "all those saving" --- 2/3 years later that consumer won't remember their name -- just that they are about to loose a ton at trade time.

    So, do as you please ... like I had said before, it's your dime, not mine.

    My grandfather use to tell me -- "Tell me what you know ... Not what you think.."

    I feel, you have been thinkin' too much ...

    Good luck .. your gonna need it.

    Terry.
  • gerapaugerapau Posts: 211
    rroyce10: Before you start educating me on the economics of leasing cars take a few seconds and read what I said:

    "Do you believe that these leasing companies are taking their cars to the states to lose money? Used car prices in Canada are currently slightly less then in the U.S. but if the leasing companies could only get half the going rate in the U.S. then I doubt that you would see many Canadian cars at all. Wouldn't it be much more profitable to keep their cars in Canada?"

    I fully realize that for many years (this is starting to change though) leasing companies have over-estimated their residuals. What I said though, was that if these cars are worth so little in the U.S. why would the Canadian leasing companies bother selling their cars in the U.S. for less then they could sell them for in Canada (and thus lose some money). Yes, used cars are slightly cheaper in Canada (5% - 10%) then in the U.S., but if a leasing company is going to take a 40% hit by selling the car in the U.S. why wouldn't they stay in Canada? The only reason that they are going to the U.S. is because they can make more money there. Maybe because the values of Canadian used cars in the U.S. are not quite as low as you would have us believe.

    Also, you stated in your last post that "This whole thing of: I can "steal" a 02 Lesabre/Chevy truck/Lincoln LS or a whatever .. is exactly what happened in the late 80's and the early 90's when everyone was "hell bent" to get a gray market Bimmer, Volvo, Benz, etc. They had the vehicles brought in .. did the $2,500+ conversion waited 2/3 months at the docks --- and when it was all done ".
    First, it is very difficult for Americans to buy any Ford/GM/Chrysler (and most other manufacturers for that matter) product in Canada and save money. This is due to the fact that the big three manufacturers (and many others) will fine any Canadian dealer who knowingly sells to an American. There has been such a problem with Americans coming to Canada to buy Thunderbirds that Ford has demanded that Canadian dealers not sell any Thunderbird for cash. All of this is because even the manufacturers realize that, with the value of the Canadian dollar as low as it is compared to the American dollar, there is a real bargain to be had. They do not want their American dealers to lose business (especially those dealers near the Canadian border).

    Second, the Benzes, Volvos, etc... that you are talking about here required major work to make them legal in the U.S. (thus the $2,500+). Even after the cars were made legal, much of the time the car was still not the same as the U.S. version. The Canadian cars that we are talking about here do not require $2,500+ to make them legal in the U.S.. They already meet all American safety and emission standards and are virtually identical to the U.S. model. In most cases all that is required is a simple change of the speedo/odo. I will accept that in some states this will result in the car being declared TMU (you obviously have more experience with this then I do). I will also accept that the cars will be worth less in 3 years then an American bought car. What I do not accept is that the G35 that someone buys in Canada today for US$26,000 will be worth $10,000 less then an American bought G35 in 3 years.
  • dustidusti Posts: 36
    that's the fact, jack.
  • lameslames Posts: 14
    I only know one person who did this and so far he has had none of the problems described here. Perhaps the West Coast is easier? Anyway, my brother purchased a car in Canada and financed it through our local bank. The title does not say "TMU" anywhere on it. The odo is still in klicks, he was going to change it, but the morons at the certified shop caused him to change his mind, as they ordered the wrong color replacement. They were going to CONVERT the klicks to MILES so I don't think it would have been TMU. He has not considered trading it in, so I don't know what the dealer reaction would be, but I do know that when the 3.5 pathfinder came out some of our local (Seattle area) dealers had the Canadain vehicles as they could not get enough from Nissan, and they WERE NOT SELLING THEM at any discount!

    Given all that, I know the east coast is a bit different when it comes to cars and titles. Perhaps out there cars from Canada are more obvious on the paperwork.

    The funny thing is that for the most part the cars are identical, same crash and emmission standards. Only the option packages seem to vary.

    BTW to Royce and others, given that a Vancouver dealer has offered to deliver a car south of the border with an Odo in miles, do you still think that would bite the buyer down the road? I don't see how it could.
  • lofquistlofquist Posts: 281
    >> Also, guess I'm still skeptical - if bringing a car in from Canada was THAT good a deal, there'd be companies lined up at the borders providing that service <<


    Last year there were 200,000 (two hundred thousand) vehicles brought into the US from Canada! You just have to go up to the border to see the line-up. Here's what I think is a good article on the subject published yesterday on Autonews. http://www.autonews.com/news.cms?newsId=1620


    Maybe Nissan/Infiniti is the only company left that's allowing the dealers to sell direct to US customers, but the dealer-to-dealer trade is flourishing. And I don't think they are being sold new with TMU!


    -Jon

  • dustidusti Posts: 36
    But here's a solution.

    Make Canada the 51st state (but leave out Quebec -more trouble than its worth)

    Besides no more trade dispute, there would be advantages for both sides.

    US gets connected with Alaska.

    Due to respect US engenders, Canadians would no longer be cheated out of their gold medals.
  • sgrd0qsgrd0q Posts: 398
    rroyce10: People like Audi, Bill and myself don't make a dime if you buy a Canadian/American/British or a Bulgarian vehicle .. it has nothing to do with us.

    You are wrong again! Bulgaria does not make any vehicles! :)

    Well, at least we all agree that if you buy a vehicle and keep it until the wheels fall off, then it makes sense to buy in Canada.

    The disagreement comes when resale/trade is added to the equation.

    Taking the Infiniti example, I just don't see how the initial $7.5K difference can increase to $10K, unless the depreciation curve for Canadian vehicles is completely different from the depreciation curve of US vehicles. But even if that were the case the curves will eventually converge. For instance, let's say that after a number of years the US Infiniti is worth $6k, then the difference with the Canadian Infiniti is bound to be less than $6K.

    So you got to agree that at least in some point in the future the difference will be less than the initial difference.

    prayerfor: Excellent post on investing the difference! A friend of mine who is a CFO said to me once that there is no difference between managing debt and managing assets.
  • landru2landru2 Posts: 638
    "Well, at least we all agree that if you buy a vehicle and keep it until the wheels fall off, then it makes sense to buy in Canada."

    Perhaps we can agree that buying a Canadian Nissan and driving it until the wheels fall off makes any sense. This sounds like the only maker not actively discouraging cross-border buying.
  • sgrd0qsgrd0q Posts: 398
    Fair enough - let's agree on the Nissan, and disagree to a various degree on everything else.
  • Terry, landru, Bill, and other dealers contributing to this thread:

    Simple YES or NO:

    Knowing all you do about the industry, resale values, TMU, and everything else we've discussed here, if it was YOUR money and YOUR purchase decision, would you choose to go to Canada and pay ~$5000 less than you would in the US to buy essentially the same car, and live with the (potential) shortcomings?

    Let's assume a) you've already determined that the Maxima is your top choice car, and b) you live within 500 miles of Toronto...
  • rroyce10rroyce10 Posts: 9,359
    ..... It's a gamble. Whether I want to try my money in that gamble is a: No.

    At least I have a pretty good idea on what vehicles are worth now and later. On those, that's anyones guess.

    Terry.
  • sgrd0qsgrd0q Posts: 398
    rroyce: I find this hard to believe. What if you planned to use the car for, say, eight years accumulating 15K miles per year?

    You really think the price difference between the Canadian and US Maxima will be more than $5K after eight years?

    I'll be generous here and not argue the "Investing the Difference" point. Let's say $5K today equals $5K in eight years.
  • sgrd0qsgrd0q Posts: 398
    rroyce: At least I have a pretty good idea on what vehicles are worth now and later. On those, that's anyones guess.

    I thought you already knew the Canadian vehicles are worthless, how come that's anyones guess ?
  • rroyce10rroyce10 Posts: 9,359
    ..... I think these are great buys ... IF, you know for sure, that there won't be any lump or bumps in your life. And you will keep it for the long haul -- that's good business.

    -- For those that have a plan (a real plan) for the next 4/5/6 years, these vehicles will do fine. 6 years down the road and 90,000++ miles later this is a good purchase. What can be the difference between a 6 yr old 100k++ Canadian and a 100k++US -- what ..? $500 over here, or $500 over there ..

    It's the guy that goes to trade in 2/3 years that will take the abuse.

    Terry.
  • audia8qaudia8q Posts: 3,138
    my vote is NO....
    and I do spend alot of time in the casino..so I'm not afraid to gamble but not with my car.
  • lofquistlofquist Posts: 281
    audia8q,
    But your vote isn't exactly unbiased. You are a dealership manager and have a vested interest in people buying locally....
    -Jon
    (BTW, love my new S4. And I did buy it locally)
  • audia8qaudia8q Posts: 3,138
    Yes, I am biased...
    But, I also have about half a dozen canadian units with washed indiana titles here on my lot. I'm not going to miss out of the gravy train but I also would not buy one myself
  • sgrd0qsgrd0q Posts: 398
    I was wondering - how can you tell if you bought a car with a "washed" Canadian title?
  • lofquistlofquist Posts: 281
    >> ...I also have about half a dozen canadian units with washed indiana titles here on my lot. I'm not going to miss out of the gravy train... <<

    And I think that's great. The American democratic way. I'd just like to see the day when we all can look at Canada vehicles for sale and think "no big deal".
    -Jon
    (not my job, just a "hobby")
  • audia8qaudia8q Posts: 3,138
    Carfax usually will have the initial numbers in kilometers and they never seem to add up correctly into miles..this is a big clue
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