US & Canadian Pricing Discrepancy

[Andre]

If I go to each country's web site and build your vehicle, there is a huge price difference between US and Canadian companies. After the exchange rate, there is about CAD$7K difference on a 3 Series. On either an X3 or an X5, there is a CAD$13K difference!

Reasonably loaded up with the same options, a US X5 is about CAD$57K and the same config on the Canadian site is CAD$70K.

What's up with this company? If I could buy an X5 for $13K less, I'd buy one today.

It makes me want to tell them to keep their product, and go buy a Jeep.

 

[deutsch100]

Wow, that's horrible. We all know "that things in Canada are more expensive", but that's ridiculous. I would send an email and/or fax to BMW Canada and see how they explain this.

 

[bmw046series]

You can thank you tax and spend govt for that, you get a hit even before you buy it, trade tariffs, etc. BMW just ups the price to cover the cost. Not to mention the cost to do business, don't you love politicians.

 

[tazza0712]

Okay, I read this with interest and then I went to BMW USA, BMW Canada and BMW Australia web sites to configure the same car and see the price differences.

Car: BMW 530i Silver Grey Metallic, Black Leather, NO other options

Prices:
USA: $49,645
CAN: $67,800
AUS: $112,500

Interesting isn't it.

 

[Andre]

I wrote BMW Canada an email to ask them why. I fully expect a droid to answer with something about how I did not configure them the same, and how there is the exchange rate to consider, etc. etc.

Back in 2000 when I bought a 328i, the situation was reversed. They were cheaper in Canada. The dealer made me sign a form agreeing not to seel the car in the US for at least a year.

 

[Andre]

You can thank you tax and spend govt for that, you get a hit even before you buy it, trade tariffs, etc. BMW just ups the price to cover the cost. Not to mention the cost to do business, don't you love politicians.

I could understand that for the German-made models, but the X5 is built in the US. Free Trade should apply. I know if I buy one in the US and import it, there is no import tarrif.

I would do that too - except the speedometer and odometer would not be metric. I may have warranty and service issues too. I wouldn't care, but it would affect resale value. Plus they probably wouldn't sell it to me knowing I'd be bringing it to Canada.

I'm looking into the European Delivery program. Maybe I can avoid some of that extra cost. BMW Canada doesn't advertise it though (but they do it). Only problem there is what I really want is an X5 - not made in Germany, so not on the ED program. I'm looking in to the X3 though.

I suspect this is simply a case of BMW Canada taking advantage of extra profits. They did not drop their prices as the Canadian dollar has gained strength. If this is the case, we need to spread the word. BMW is trying to rip us Canadians off.

 

[Kirby]

I wonder how the prices of a VW or Mercedes compare between US & Canada? Maybe that would expose BMW profits vs. tariff costs?

 

[bmw046series]

Well they may build the Z4 and X5 but parts come in a box from Germany, which is still subject to imports. The engine mostly, I think the Z4 is 45 % from USA and Canada. But 55 % is still a huge margin.

 

[Big Daddy]

Well they may build the Z4 and X5

Not may they do build them here.

 

[William330]

See, and you thought your healthcare in Canada was "free."

 

[Andre]

Here's BMW Canada's response to my email:
---------
Thank you for contacting BMW Group Canada Inc.

In response to your email, regarding the difference in pricing for Canadian BMW vehicles versus the United States, we would like to confirm that Canadian prices are based on the market conditions in Canada. Presently, due to a rapidly strengthening Canadian dollar, pricing may appear higher than the U.S., yet are still considerably lower than most other markets around the world.

We are very cognizant of the U.S. pricing; however, we have to price for the long term in Canada. If we were to reduce prices on all new BMWs, it would reduce the value of every existing BMW in the country. We have a responsibility to protect our existing owners' investment and BMW resale values in Canada.

Raising and lowering prices based on short term exchange rate swings would cause great uncertainty and instability in the market. As you can appreciate, the competitive marketplace is different, and the costs of doing business in Canada are much higher.


Sincerely,
Customer Care

------
So, it's nothing to do with tariffs, just that's the way it is.

 

[Big Daddy]

Sounds like they figure you can afford it!

We are very cognizant of the U.S. pricing; however, we have to price for the long term in Canada. If we were to reduce prices on all new BMWs, it would reduce the value of every existing BMW in the country. We have a responsibility to protect our existing owners' investment and BMW resale values in Canada.

This part was interesting, they care about the resale value of my car, how nice!

 

[bmw046series]

Thats why I love BMW.

 

[Andre]

So to paraphrase, "We will continue to rip off Canadian buyers big-time, and our excuse is to not tick people off".

 

[Big Daddy]

I understand your frustration, but I think what they are saying is that the market in Canada is bearing our prices so we are not going to lower them. I think the concern for previous customers is smoke and mirrors!

 

[tazza0712]

Sounds fair enough to be honest

 

[Andre]

Well I thought I'd buy an X5 from a US dealer. I contacted one, and they said they are prohibited by BMW from selling to a Canadian. They can't even sell me a used one.

 

[Big Daddy]

Well that is depressing, I cannot see how they can deny selling you a car regardless who you are.

 

[Andre]

When I bought my 2000 328i, the situation was reversed. They were cheaper in Canada, and had better standard equipment. Before closing the deal, the dealer made me sign a form agreeing that I would not sell it in the US for at least a year.