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Importing Canadian Vehicles to the U.S.

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Comments

  • tincup47tincup47 Posts: 1,508
    Part of this issue from an Import manufacturer's standpoint is that in each country or market has there own Distributor. That distributor is responsible for sales and aftersales support for that market. This goes back to the early days of imports, when there wasn't enough demand for the factories to distibute vehicles overseas. Most started out as not being part of the manufacturer.These are run as separate businesses, that have budgets, objectives, and profit expectations. They are basically setup as independant companies that make their profit from the difference of the cost they are charged from the manufacturer and what they sell to the dealers. From that profit and the profit from parts sales, they have to pay for marketing programs, employee salaries, transportation costs, and warranty claims. Every warranty claim they have to pay for grey market vehicles is a total loss, as the distributor made no profit off the sale of the vehicle, it went to another distributor. This is not a problem in small numbers, but with the currency deviations between the US and Canada right now it could get out of control if left unchecked. The European Union is in a different situation right now, as with the Euro you won't have the differences in exchange rates you have between the US and Canada. When Grey market cars from Europe were a big item in the early 80's, Mercedes, Porsche and Ferrari all refused to warranty Grey market cars.
  • audia8qaudia8q Posts: 3,138
    Since you mentioned Nissan...no, the six month rule would not apply. Nissan is one of those companies that has already but the kaibash on all over the boarder sales. no warranty.

    the six month rule is one that is being tossed around by some mfg's and being used by others. Nissan has already made their importing/exporting decisions.
  • sonjaabsonjaab Posts: 1,057
    Talked to the Canadian Caddy dealer about
    GMs no warranty deal on GMs from Can. to the
    USA...Dealer said ANY problems bring it back
    to us we will fix it ! I figure it this way
    its 25 miles to the Canadian dealer and 25
    miles to the Watertown Caddy dealer !
    Besides they will give me a loner car and I
    can go to the new CASINO for the day !
    MY 96 Cad only died oncein 5 yrs.... last year fuel pump died !...................geo
  • alfoxalfox Posts: 716
    I might consider doing the same thing, especially with the potential savings, although if I planned any travel in other parts of the US I might re-consider it. Sounds like the auto manufacturers are shutting down the gray market, though.
  • janzjanz Posts: 129
    We reproduce, without further comment, the following as reported in the June 6 issue of the "Automotive News". . . . :

    They're unfair to authorized dealers in other countries
    Warranties may not be valid
    Difficult to issue recalls
    Contribute to shortages in the local market
    Vehicle may not meet export market's safety rules
  • masspectormasspector Posts: 509
    Consider the source, "Automotive News". . . . :

    "They're unfair to authorized dealers in other countries"

    Like has been said on these boards many times to buyers after they make a sale and have a complaint....Grow up, life ain't fair.
  • tincup47tincup47 Posts: 1,508
    What about the recall issue? How is that supposed to be tracked. Does the US Gov't. have any info on cars sold in Canada? Is the US distributor supposed to take responsibility if a non-US spec vehicle doesn't pass our emission or safety standards? It basically comes down to people wanting to have their cake and eat it too. You want a price that doesn't have the added costs associated with complying with US regulations, but you want all the protections of the Magnusson-Moss warranty act (which does not require warranty coverage either express or implied on items purchased outside the US) and NHTSA and DOT regulations. There comes a time that bargain hunting will have consequences you should be willing to pay for. If you knowingly and willingly buy a product by circumventing your market conditions, you should realize there can be problems and should be willing to deal with it when they occur.
  • audia8qaudia8q Posts: 3,138
    Don't waste your fingertips on the typing...some posters on here are not interested in a legit debate...but to slam the industry and project their one sided slant on theories and not reality.
  • sonjaabsonjaab Posts: 1,057
    Remember Canada cars meet the same EPA,
    emissions, safety rules etc. as any 49
    state (except calif.) for the most part.
    Europe ASIA, Brazil, etc gray market cars
    DO NOT !.........geo

    I am not worried GM has your vin # and will
    take care of any NHTSA recall no matter what!
    As I have posted here a few of my friends have
    Can. grey market cars. But if the mfrs. close
    the warranty loophole oh well.....
    My 96 Cad had only 1 problem (fuel pump) well
    after warranty expired.........
  • janzjanz Posts: 129
    I guess people are welcome to find their way around the process. I just know that when I try it, I end up paying for it.

    I have been doing some reasearch and reading in importing vehicles from Canada and we have a friend in the business. I have found nothing to support the claim that vehicles can be legally imported, NOT going through the rules established by US CUSTOMS and NHTSA Registered Importers who cover all the safety and recall paperwork and assure that the safety regulations are followed.
  • masspectormasspector Posts: 509
    Debate is just that, two different points of view. If we all had the same point of view, these boards would be pretty dull. You are trying to put out the dealer view, others are trying to put out the consumer view. I respect your view and your right to post it. I hope you have the same opinion of others. You and the other dealers here do a great service by providing the posts that you do. Of course we could always try to get ptmccain back...LOL.

    tincup--not sure about the recall issue, I would have to think about that. But as far as safety regulations and all, there is no additional cost for a canadian car to meet US standards. They already do. That has been said before by other posters in this thread. I agree that there are many complex parts to this issue. That has been made clear by a number of posts to this thread. But it is my belief that the root cause of manufacturers not wanting to honor canadian car warranties in the US is that individual buyers and dealers were buying cars cheaper in canada for the same product and US dealers were losing business to the canadian dealers. So the manufacturers are using this tactic as a tool to stop this practice. All of the reasons that you listed were issuses a few years ago, however the manufacturers did nothing to try to stop grey market imports back then.
  • tincup47tincup47 Posts: 1,508
    As someone who works for a distributor in the US, everything I have brought up about the economics is still valid. We still have to rely on our sales for our profit, Canada is a separate entity. From that profit we cover our warranties. For some manufacturers warranty coverage is actually different in Canada, and there are sometimes parts differences. Subaru comes to mind on that, they have several models that have different exterior and interior trim. There US parts distribution centers probably do not carry these parts in their inventories, and bringing in parts for grey market cars increases their costs. One other thing to consider is that projected warranty costs are taken into consideration when pricing out vehicles, so the U.S. Consumer who does not buy in another country is going to be subsidising those who do with even higher vehicle prices.
  • audia8qaudia8q Posts: 3,138
    debate is great....regretfully, your posts are usually filled with inuendo's, slams and typical stereotypical comments. Which add's NOTHING to the debate.

    Stick to the actual debate with facts and reality and you will earn my respect and others.
  • janzjanz Posts: 129
    REGISTERED IMPORTER NEWSLETTER No. 20
    National Highway Traffic Safety Administration
    Office of Vehicle Safety Compliance
    October 2001

    FMVSS NO. 401, INTERIOR TRUNK RELEASE

    This new standard requires passenger cars with a trunk compartment to have an automatic or manual release mechanism in the trunk compartment that unlatches the trunk lid. This standard became effective on September 1, 2001; however, certain vehicles are exempt from this requirement until September 1, 2002. See 66 FR 43113 dated August 17, 2001. CANADA DOES NOT HAVE A STANDARD SIMILAR TO THIS REQUIREMENT. The statement of conformity has been updated to reflect this new standard.
    D
  • dtwleungnycdtwleungnyc Posts: 188
    If U.S. buyers keep going to Canada and pay Canadian MSRP price, which is still cheaper than U.S. invoice price. What happens to the Canadian consumers' bargaining power?
  • bretfrazbretfraz Posts: 2,021
    If U.S. buyers keep going to Canada and pay Canadian MSRP price, which is still cheaper than U.S. invoice price. What happens to the Canadian consumers' bargaining power?

    I think that question was addressed, like, 50 posts ago. Sorry, not being a smart aleck but this subject has been beaten, revived, and beaten again by the same people so much that its making summertime roadkill look appetizing.
  • masspectormasspector Posts: 509
    You are right, this thread is starting to sound like a broken record.

    If landru is reading this thread, please answer this question. Have canadian dealerships in the past (say from 1990 to 2000) been able to sell cars to americans knowingly without any interference from the manufacturers? If the answer to the first question is yes, then why, in your opinion, is this such a big deal in the last year or two? Thanks
  • masspectormasspector Posts: 509
    said "debate is great....regretfully, your posts are usually filled with inuendo's, slams and typical stereotypical comments. Which add's NOTHING to the debate."

    I am sorry that you view my posts that way, I guess we just have different opinions. Other readers may see my posts differently than you do.

    Facts and reality are great, but I believe that these forums are also a vehicle for people to express their opinions to others also. We should both be free to express ourselves without the retaliation of snide comments and put downs.

    I respect what you do and what you say here.
  • audia8qaudia8q Posts: 3,138
    why would we let facts get in the way of your theories?? haha
  • audia8qaudia8q Posts: 3,138
    Honda's Canadian unit will stop telling U.S. importers whether its cars sold in Canada were repaired after a recall, a strategy the automaker is using to thwart the flow of so-called gray-market cars into the U.S. The lack of information about whether recall repairs were made is expected to slow the practice. Honda is the only automaker with this strategy, said Brian Osler, president of the North American Automobile Trade Association in Richmond Hill, Ontario.

    "Importers have to make sure there are no outstanding recalls on any vehicle they buy before it comes into the U.S., so this creates a situation where the importer won't know if a necessary repair has been made or not," Mr. Osler said.
  • masspectormasspector Posts: 509
    What about legitimate import companies?
  • rroyce10rroyce10 Posts: 9,359
    ..... There is no warranty via Honda on Canadian vehicles, that are bought in the US of A ..

    I see 20/30 Canadian vehicles a week roll through the auctions .. the Dealers that buy em' are either not aware, or they take em' home and slap a $1,000 warranty on them to cover potential problems, which is fine.

    But, if you buy the vehicle in NJ and you take your family on a trip to the Grand Canyon and the air cough's up in New Mexico, then depending on the Dealer you have to cover the $8/$1,2/$1,500+ bill out of pocket .. and then wait for the the warranty co. to reimburse you. Sooo, there is not much fun going on here. .l.o.l.

    Terry.
  • tincup47tincup47 Posts: 1,508
    What do the manufacturers owe to independent importers if they already have an established importer and dealer network? The dealer network is the manufacturers business partner, not the independent importer. It is the same in any other area, for example consumer electronics. If you buy a Grey market product, you are bypassing the people who provide and pay for the warranties, the offical importer. In this case, that is Honda USA. Honda Canada is actually a separate entity.
  • rroyce10rroyce10 Posts: 9,359
    .... Exactly ..!

    Terry.
  • masspectormasspector Posts: 509
    But aren't you ultimately buying a Honda, period, whether you are a dealer, importer, or consumer?

    I was confused by your statement "If you buy a Grey market product, you are bypassing the people who provide and pay for the warranties, the offical importer." I thought the warranty came from the manufacturer, not the dealer. Isn't that how I can go to any dealer for warranty work, not just the one I bought the car from? I am not sure about this, so that is why I am asking. You made a reference to consumer electronics. So you mean by your statement above, that Best Buy actually provides the warranty for all of the products they sell, even though if the problem shows up after 6 months of ownership, I have to contact the manufacturer, not the retailer for warranty service?

    You also said "The dealer network is the manufacturers business partner". I believe in every US state there are laws that car manufacturers can only sell to dealers. This is why there are no direct factory shops or no internet manufacturer sales websites. Seems like a forced business partnership to me. I wonder if the manufacturers would like more flexibility in the way they sell their products? Just curious.
  • tincup47tincup47 Posts: 1,508
    You may be buying a Honda, but not from the parent company. Most companies have set up distributors in different countries, like Honda USA, Honda Canada, Honda UK, etc. These are run as a separate entity that actually buys the vehicles and parts from the parent company. They in turn set up the marketing programs for their areas of responsibility. Warrantees are different in different markets, so the distributors (ie, Honda USA) are responsible for setting these to be competitive in their areas. Do you think Hyundai offers a the same warranty in Europe as they do in the US? I can almost guarantee they don't. When you buy a Sony TV from Best Buys, you are buying from a retailer, not Sony's US Distributor. That would be Sony USA, and they provide the warranty for your TV. Best Buys buys their product from Sony USA, not from the parent company in Japan. Sony USA buys from Sony Japan.
    Although their have been some attempts for the manufacturers to sell direct, the stores set up in states that do not have laws prohibiting these businesses have all lost money and have been sold to private owners. With the current low profitability that US manufacturers are experiencing, I doubt that they want to add several hundred thousand employees to their payrolls to operate dealerships. The franchisees at this time carry this payroll and benefit burden, and I don't see this changing soon.
  • masspectormasspector Posts: 509
    Thanks for the info. Why set up all of these distributorships? Sounds like just more red tape. I could see a company having seperate divisions in itself for different geographic regions, but seperate companies seems to me like it would just add another middleman and increase costs for everyone.

    This topic was on a local radio show in my area yesterday and the host said that the reason that it is "legal" for US buyers to buy in Canada is due to NAFTA. He also cautioned about the manufacturers not honoring warranties and that you are taking a risk if you buy a car in Canada. He mentioned something about a rule that if the car had 7500 miles on it when it came to the US that the waraanty would be honored. Not sure if that was from a specific manufacturer or not.

    Of course the manufacturers love NAFTA and free trade when they can have their cars put together by $2/hour laborers in foreign countries, but when a consumer tries to use the other side of that two way street to buy a car in a different country, they cry foul. What a bunch of babies.
  • tincup47tincup47 Posts: 1,508
    Most of these distributorships go back to when the companies that set them up were much smaller and were trying to limit the financial risk to the distributor if sales went down the tubes. It also helps to have companies that are in the affected markets that are locally operated to be able to respond to differing governmental regulations and to respond quicker to market forces. Many times these distributors determine equipt level and pricing issues to be competitive in their markets. The main company cannot keep up with this info, as they are to far removed from the markets. These distributors are set up as separate entities to have accountability to the parent company. They have payrolls, sales targets, profit targets, etc. to reach. This is the only way the parent company can keep track of how they are doing in each market.
    This grey market issue was not set up to stop the few individuals that cross the borders to shop, it was set up to stop the wholesale importation of vehicles that goes around the manufacturers network, thereby undermining the official distributors and retailers ability to make a profit. Unfortunately, the smaller individuals are going to end up being affected also. I look at it as a loophole being closed that only benefitted a small number of individuals who want to have their cake and eat it too.
    Exchange rate differences affect cost of production much more than the salaries of the manufacturing employees. Japanese workers make as much as ours but due to the artificially weak yen, Honda and Toyota are posting record profits. Part of this is due to manufacturing efficiencies, but most is due to the exchange rate.
  • sonjaabsonjaab Posts: 1,057
    I agree...When you buy a mexico assembled
    car. Does the auto maker charge less ?
    Heck no ! You know they aren't paying the
    same labor rate as a US or Canadian auto
    worker gets !........geo
  • alfoxalfox Posts: 716
    to assure that automakers charge no more than they have to to sell the product. It's called competition.

    If you think VW is banking huge profits on the Jetta just because of the Mexican labor rates, and not dropping prices, you're smoking better stuff than I am. Any significant savings an auto maker can gain by using least cost assembly methods will make it's way into the MSRP. Why am I so confident of that? Because I know that if an automaker didn't keep prices as low as they can, some other competitor would, and undercut them.

    More likely VW uses lower labor costs to market a product at a competitive price that would cost (MSRP) 10-15% more if assembled in Germany or the US. I see that as more car for the money available to me, the customer. The Mexican workers see it as a job and food for their families. If the UAW has heartburn with that, they should compare their pay and benefits against the World prevailing wage rates and see if there is maybe a mismatch. There is - this isn't a predatory manufacturer issue, it's the UAW that's pricing itself out of jobs.
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