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Used cars are one reason for high new-car prices

MICHAEL VAUGHAN

From Thursday's Globe and Mail

Latest comment posted at 5:59 PM EST 14/11/07

Michael Vaughan speaks to Tino Rossini, exotic car importer, about the residual value of leases, and how lower vehicle prices in the U.S. effects the Canadian auto market. ...Read the full article

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  1. Luc Lafrance from Ottawa, Canada writes: One of the best articles on this subject! I've commented on a lot of the earlier G&M stories on this topic and very early on identified the potential loss on lower residual values as one of the main reasons why manufacturers wouldn't lower MSRP's. Unfortunately, as many other posters have said in their posts, the manufacturers have had lots of time to adjust their prices, and never did. I have no sympathy whatsoever for them. That big loss on residual values, they're going to have to eat it!
  2. bill johnson from quebec, Canada writes: Canadians imported 24,800 vehicles from the USA in October. The auto manufacturers and the press and dennis deroissers try to make it sound like only a few Canadians are cross border car shopping, however this number, if it were to persist over the course of a year, amounts to 250,000-300,000 cars/year. They sell about 1.5 million per year in Canada, so you're looking at 1 out of 6 vehicles purchased in the USA. The current scam of year end window dressing does not constitute a real 30% price reduction, so, Canadians, continue to shop in the USA.
  3. D M from Canada writes: I paid cash for our new car on December 2006 when the dollar was a lot lower than it is now. I am aware that if the manufacturers come to their senses and lower prices my car's resale value will go down. The fact that I (and many other owners) may lose out on resale is not reason enough for the auto companies to keep their prices up.

    While I don't mind paying up to 10% more than my American neighbours; but I certainly would not fork out 20% to 30% more when our dollar is tarding at a premium.
  4. Gardiner Westbound from Canada writes:

    I wanted to buy my leased car at term's end. The lease contract buy price was significantly higher than market price. I offered market. The dealer refused. I bought a new car elsewhere. I later saw my old car on the dealer's lot priced lower than my offer. Really stupid!!!!!!

  5. Devon Kelon from Canada writes: The price differentials on some cars are staggering when you consider the deals you can get in the US, especially on premium cars. Consider the Porsche Cayman - current CDN MSRP from Porsche Canada web site, $69k. US out-the-door price reported on several forums: $44-45k. Nissan 350Z: $47k list CDN, $27-28k out the door US.
    There is no possible plausible rationalization the car companies can offer for these huge discrepancies. Even new vehicles without past model years like the upcoming BMW 135i have these huge differentials. Where's "free trade" when you need it?
  6. Luc Lafrance from Ottawa, Canada writes: The 350Z is a bad example. What is the base car in the US is not available in Canada; it has much less content that the CDN base car. I'd say Nissan's thinking on that call would have been: "we'll only sell a few anyway, so let's load 'em up!".

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