Question re: Lexus prices, USA vs Canada

[jayk]

I was looking on lexus.ca and lexus.com

And the price of the IS250 AWD /RWD is very similar in the US vs Canada.

Have they already started adjusting prices to reflect currency changes?

[onecoolloser]

I was looking on lexus.ca and lexus.com

And the price of the IS250 AWD /RWD is very similar in the US vs Canada.

Have they already started adjusting prices to reflect currency changes?

No, the prices havent been adjusted. The Canadian IS250 has always started at 34xxx. The price difference between the Canadian and the US IS250 is about 5k IIRC.

There's not much of a price gap. After taxes and all, it might be worth buying the car here, since less hassles overall.

[Evil Techie]

for cars like LS460L, there is much more savings to be had
but i dont think you can buy a brand new one anymore from the US dealerships as a canadian citizen
you have to find another way to get new lexus from US into canada
ie: buy a slightly used one

[onecoolloser]

but i dont think you can buy a brand new one anymore from the US dealerships as a canadian citizen

Cant buy a new one? .. or is it the law that states that it has to be older than 6 months?

[GoiNGPoSTaL]

Cant buy a new one? .. or is it the law that states that it has to be older than 6 months?

No Toyota/Lexus dealers are not supposed to sell new cars to Canadians (pratice is becoming more common with other dealers).

[Edirol]

On lexus.com I see the IS250 RWD Auto for 31,625USD.

On lexus.ca it's 36,550 CAD. The base USD model also includes leather, moonroof, power seats, 17" RIMs where all these are options on the CAD model. The equivalent "Leather /w moonroof" package in Canada is 43,300.

I've been looking at this car and the price difference is crazy.

[moguy]

Yeah, you have to include the options so that the cars are similairly equipped.

US luxury cars usually come with more options included.

Same goes for BMW.

No matter how you price them, there will be a minimum of 10K difference.

The more options you add the bigger the difference, since the options are even more disproportionate than the base automobile.

[redflower]

The price in the cars is always huge between the US and Canada. I imported my Nissan Murano from the US. A new one only costs about $33K there, but in Canada it costs close to $50 for the same car. The dealer in the US told me that the Canadian price is higher since the car makers have to pay higher duties and other border fees when the cars come to Canada, but these are much lower in the US. Not quite sure how it all works, but this is what I was told.

[rayner55]

The price in the cars is always huge between the US and Canada. I imported my Nissan Murano from the US. A new one only costs about $33K there, but in Canada it costs close to $50 for the same car. The dealer in the US told me that the Canadian price is higher since the car makers have to pay higher duties and other border fees when the cars come to Canada, but these are much lower in the US. Not quite sure how it all works, but this is what I was told.

Thats not neccessarily true, a lot of cars are made in Canada and still cost more. What pisses me off is when companies charge freight such as the Civic SI costing 1500 for PDI and freight when it is made in Alliston which is less than an hour from Toronto, and yet they are charging only 800 for freight in Florida on the same car. That is such a lame excuse for freight, twice as much than America and less than 100km away vs shipping it thousands of miles to Florida.

[redflower]

They can be made in Canada, but it being a Japanese car, Toyota or Honda or whoever, still have to pay more in ******** fees if they want to sell in Canada because it is a Japanese car. In the US, this does not happen so cars and parts are cheaper.

[redflower]

I did some reading on the issue and asked around and everything seems to point that it is government fees that makers have to pay that raise the car price in Canada. I am sure the dealers are greedy as well, but not more then they are greedy in the US.

[tataynik]

They can be made in Canada, but it being a Japanese car, Toyota or Honda or whoever, still have to pay more in ******** fees if they want to sell in Canada because it is a Japanese car. In the US, this does not happen so cars and parts are cheaper.

Cars made in Canada, Mexico & US although from Toyota/Honda/Nissan/etc are not considered Japanese cars anymore because their cost are legislated to contain a certain percentage that are North American (part/labor/etc). These cars are now considered North American cars. They do not pay other extra fees over cars made in Canada, Mexico & US that are branded as GM/Ford/Chrysler. This is all in the NAFTA deal. That is why Japanese manufacturers build plants here so that they are protected from duties & tariffs that Canada & US can impose on "real" imports.

[KawaiiTentacleBeast]

What "government fees" are you talking about? I'm not aware of any substantial tariffs on Japanese cars in either the US or Canada. The only one I'm aware of is the "Chicken tax" on imported trucks that they have in the US, which is why there are no small diesel pickup trucks in the US that are quite common in the rest of the world. I seriously doubt it costs Toyota $10k more/car to bring them to Canada. Foreign car companies don't generally build factories here because of any concern with tariffs or duties because there are none. There are no duties/tariffs that I'm aware of for Big 3 cars in Japan or Germany, either, contrary to what that CAW guy seems to think. If GM wants to start selling W-body Buicks in Japan there's no tariff stopping them.

[tataynik]

What "government fees" are you talking about? I'm not aware of any substantial tariffs on Japanese cars in either the US or Canada. The only one I'm aware of is the "Chicken tax" on imported trucks that they have in the US, which is why there are no small diesel pickup trucks in the US that are quite common in the rest of the world. I seriously doubt it costs Toyota $10k more/car to bring them to Canada. Foreign car companies don't generally build factories here because of any concern with tariffs or duties because there are none. There are no duties/tariffs that I'm aware of for Big 3 cars in Japan or Germany, either, contrary to what that CAW guy seems to think. If GM wants to start selling W-body Buicks in Japan there's no tariff stopping them.

If you read on the NAFTA rules regarding automobiles, you will see how they started phasing out duties & tariffs between Canada, Mexico & US. This means that there was tariff & duties on cars prior to NAFTA & it also means that there are tariffs & duties on cars brought in from other countries other than US & Mexico.

Cut & paste:

MEXICO AUTO INDUSTRY AWAITS EFFECTS OF NAFTA TARIFF ELIMINATION ON NEW AUTOMOBILES.
Publication: SourceMex Economic News & Analysis on Mexico
Date: Wednesday, January 21 2004
You are viewing page 1

The Mexican auto industry, already facing a slump in sales and increased global competition, has an additional concern this year: the elimination of tariffs for new vehicles imported from the US and Canada under the North American Free Trade Agreement
(NAFTA). A NAFTA timetable stipulated that Mexican tariffs on imports of new automobiles from the two partner countries in the agreement were to be eliminated in the 10th year of the agreement, which is 2004.

[KawaiiTentacleBeast]

Bwuh? How on earth would it mean that? Do you have an example?

[tataynik]

Bwuh? How on earth would it mean that? Do you have an example?

****Sorry to OP ************

C & P from Japanese Automobile Manufacturers Asso. of Canada

AUTOMOTIVE TRADE POLICY REVIEW - The Tariff Issue in Context

The review is timely, as auto trade policy in Canada is in need of repair. While considerable attention has been given to the matter of MFN tariffs on finished vehicles, the focus on tariffs some times obscures the underlying problem with current policies. While lowering tariffs can alleviate the problem, the key concern is to have an auto trade policy that is fair and non-discriminatory, applied equitably to all foreign owned automakers in Canada consistent with international trade rules. To be sure, differential tariffs on finished vehicles are a major symptom of the problem, but the heart of the issue is more precisely the principle of having a fair and equitable trade policy. The two-tiered industry, established under the Auto Pact in 1965, has been fragmented by changes in the Auto Pact through both the FTA and NAFTA trade agreements.

In 1989, the Auto Pact abruptly changed and became exclusionary as a direct result of the FTA negotiations with the U.S. What's more, over the last fifteen years or so, internationalization of the auto industry also changed both the competitive environment and the opportunities for cooperation and strategic alliances among globally-focused automakers and parts makers.

As a result, there are now four tiers reflecting different treatments in the Canadian market, keeping in mind that overall 80% of all vehicles produced in Canada are exported and 70% of all vehicles sold in Canada are imported.

* Auto Pact importers that are eligible to import finished vehicles duty free from any country;

* non-Auto Pact importers that pay applicable MFN duties on vehicle imports;

* non-Auto Pact importers that do not pay MFN duties on imported vehicles due to business affiliations with an Auto Pact company;

* and non-Auto Pact importers that qualify for (currently or in the near future) but are denied Auto Pact benefits due to a provision in the FTA, and therefore also pay applicable MFN duties on vehicle imports.

C & P from CAW

Backgrounder on Tariffs

The Canada-U.S. Autopact allowed companies to bring parts and vehicles from anywhere in the world into Canada without any tariff (import tax) - but there was a condition. They had to have a certain level of commitments to jobs and investments in Canada to qualify.

When Canada entered into the FTA (Canada-U.S. Free Trade Agreement) and NAFTA (North American Free Trade Agreement), the Auto Pact was eroded. The result was that any company that had a significant presence somewhere in North America, could bring parts and vehicles from the U.S. and Mexico into Canada.

Although weakened, the Auto Pact still had some bite because the tariff still applied to parts and vehicles coming in from overseas. For example, cars from South Korea or parts from Japan currently pay a tariff of 7.3% (cars) and 0 - 2.3% (depending on the kind of part).

Now the federal government is considering dropping these tariffs entirely and essentially killing what is left of the Auto Pact.