When Dr Laurie Cook of Prince George,
BC, began looking south of the border to buy his third
Toyota Tacoma he thought American dealerships would
jump at the chance to sell to a Canadian.
"Each of the three dealerships
I called in Washington told me they wouldn't sell to
me," he says. "Each said Toyota would punish them if
they sold a new car to a Canadian."
With our dollar now past parity
with the US dollar, swarms of Canadians — Dr Cook
among them — have been crossing the border to make
low-priced buys on everything from soft-serve ice-cream
makers to Porsches. Or at least they're trying to.
SOUTH
OF THE BORDER
Dr Cook says he sees no benefit to buying his pick-up
in Canada right now. "For the Toyota Tacoma I would
be saving around $7,000 from the Canadian price since
it costs about $29-30,000 in the States compared to
$36,000 around here."
A sales manager from one Washington
dealership where Dr Cook inquired said he was warned
by Toyota North America not to sell to Canadians as
it would result in a reduction in his annual allocation
of cars. He claimed the company discouraged sales further
by threatening to force him to pay back any of the standard
$2,500 promotional rebates he gives to Canadians.
In his frustration, Dr Cook began
calling further afield, only to find Toyota was always
a step ahead of him. "Toyota has extended the tentacles
of this policy," he says. "Before it was just the border
states, but one week ago I called a dealership in Colorado
and they said they couldn't sell me the truck either."
He turned to a Denver-based exporter
— a broker between the dealership and the customer
— who he hoped would buy the vehicle and sell it
to Dr Cook across the border as a used car, thereby
bypassing Toyota's effort to force Canadians to pay
the higher Canadian prices. Toyota's website offers
an explanation for the disparity in prices; cars sold
here are "made-for-Canada," the site claims, with options
and features "best suited for Canada's challenging climatic
and driving conditions."
But the exporter said he couldn't
do it. He'd been shown a letter the week before officially
outlining penalties for dealerships making new car sales
to Canadians.
But how would the company know,
Dr Cook wondered? "The corporation can force these restrictions
because of the VIN numbers," explains the exporter,
who asked to remain anonymous. When a car is registered
in Canada, the Vehicle Identification Number enables
the car to be easily tracked back to its initial point
of sale.
The exporter says Toyota is not
the only company with these policies. General Motors
and Acura have implemented similar policies on cross-border
sales. "This is completely contrary to the true spirit
of NAFTA. This is market protection, but NAFTA is all
about having a level playing field."
PRICE
FIXING
Dr Cook is far from the first Canadian to be turned
away from US new car dealerships. One Newfoundland couple
claims they were denied by every dealership in Maine
when they tried to buy two new cars. They recently launched
a suit in New England seeking monetary and punitive
damages from General Motors, Jeep, Dodge, Chrysler and
Ford for the time and money they spent travelling there
to make a purchase.
But the lawsuits don't end there.
The couple's lawyer, Stephanie Jazlowiecki, is also
considering filing a class-action suit on behalf of
the large number of Canadians who have contacted her
with similar complaints. And consumer advocacy groups
in Canada filed a class-action lawsuit last month in
Ontario Superior Court seeking a whopping $2.1 billion
from GM, Honda, Chrysler and Nissan, alleging the companies
fix car prices 25% to 35% higher here than in the States.
In the meantime, though, Dr Cook's
search has stalled. "Maybe they will change their policy
quietly in a year when the pressure mounts," he says.
"But right now, when people are able to save thousands
on an average vehicle, Toyota is pocketing a large amount
of money on their consumers' backs."
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PHYSICIAN LIFE
