Ken Wang from Calgary seeing cheaper prices in US and plus the strong currency of his Canadian dollar wanted to purchase a Lexus from across the border in Tacoma, Washington state. And he also wanted to trade in his Buick for a new Lexus and he thought by trading in the US, he could save as much as $20,000 Canadian Dollars (18,841 US Dollars).
All his high hopes of saving money came to a standstill after the dealer plainly refused him to sell the Lexus
car because he was a Canadian.
Wang called the practice biased. He said:
"How come, because we are Canadian, we can't buy a brand new car from the States? Why, because our money is different".
When Wang probed them more to find out the reason why, Frank Lee, the general manager at the dealership told him that they have a franchising agreement with the Lexus factory. They don’t want to go into Canadian Lexus dealers’ marketplace.
According to the Competition Bureau, they say there is nothing illegal about the practice. The reason they are done is to prevent “arbitragers”, who buy cars in the US and bring them back to Canada and sell at an inflated price. Arbitragers will make more profits if they are allowed and will put a dent in sales at the respective dealership.
The current price of Lexus ES 350 in the US costs about $35,621 Canadian dollars (33,218 US Dollars), the same model costs more than $7,000 in Canada (US$6,591). A Honda Accord sold in Canada costs more than $3,000 than the US.
It is disappointing for Wang, but because of the rules, the dealer in the US is unable to sell him the Car. Maybe he has relatives here, who can buy it for him and give him as a gift? If there is free trade between the nations there won’t be any problems, but till then we have to comply with the rules.
Do you encounter such difficulties across the border?