BMW, Mercedes Named in Lawsuit

cynic submitted on 02/28/2008 Official AutoSpies Timestamp: 1:13 PM
from: www.ctv.ca

[21] user comments | category: Misc News

Tags: BMW, Mercedes

Tag Links:

BMW

Mercedes

BMW, Mercedes Named in Lawsuit

TORONTO -- Two government agencies are being accused of conspiring to drive up prices on some luxury cars imported into Canada in a lawsuit filed this week.

Transport Canada and Canada Border Services Agency are named along with BMW Canada Inc., Mercedes-Benz Canada Inc. and Mercedes-Benz USA LLC in the court action that is seeking more than $1 billion in damages.

The statement of claim was filed in Ontario Superior Court on Monday on behalf of Fournier Leasing Company Ltd. and Canadian Auto Associates Ltd. and is seeking class-action status.

It alleges the automakers and the government violated competition and consumer protection laws by forcing Canadians to pay excessive fees, ranging in the thousands of dollars, for unnecessary vehicle modifications and approvals on cars imported from the U.S.

Lawyer Brian Osler claimed in an interview with The Canadian Press on Thursday that Transport Canada and the car companies have different procedures for importing Mercedes and BMW cars than vehicles from other automakers.

Among them, he says, are needing authorization from the manufacturer, which he says charges stiff fees for everything from vehicle inspections to providing recall information, contrary to the Consumer Protection Act and Competition Act.

The suit also alleges people have been paying artificially inflated prices for new Mercedes vehicles in Canada because these additional costs imposed on importers restrict competition in the Canadian market.

Mercedes-Benz Canada spokeswoman JoAnne Caza said Thursday her company had not been served and was not in a position to comment on the lawsuit.

None of the charges has been proven in court. Read Article

Comments:

Images hosted in your AgentSpace can now be posted in the comments section using the following syntax (case matters):
[img]IMAGE URL[/img]
Example: [img]http://agent004.myautospies.com/users/150/Sample-Gallery/sample1.JPG[/img]

silver1 - 2/28/2008 5:48:48 PM

-1 Boost

Ok... Why does this not surprise me?

reply to this comment

commander104 - 2/28/2008 6:03:01 PM

+3 Boost

nothing to do with this but I love driving north of the border, rarely a speed trap and people actually obey "keep right, pass left".

reply to this comment

Agent63 - 2/28/2008 10:16:17 PMView My AgentSpace

0 Boost

I live in Vancouver, BC. There are a lot of cops out there hunting down people speeding. There are several helicopters as well roaming the metropolitan area as well. However since this country isn't so densely populated in most parts it's a nice drive especially through the Rockies.

Vancouver is quite dense. The ratio is probably comparable to NYC.

commander104 - 2/29/2008 4:50:01 PM

+1 Boost

my experience is only in the horseshoe region

Steve - 2/28/2008 6:12:40 PM

+3 Boost

If you want to see how Canadians continue to get screwed, take a looks at Canadian retail prices on just about anything, and compare to US prices. And this, even though the Looney is trading at about par with the Greenback, and has been doing so (or better) for about 1/2 a year (so forget those "inventory" and "prices are set months in advance" arguments). Even more surprising is US-branded cars that are made in Canada: They are more expensive, by a lot, when sold in Canada as compared to the same Canadian-made vehicles after they are shipped to the US, and sold there, new.

A premium of between 15% to 30% is the norm, and it continues to this day. Add on to that a provincial sales tax PLUS a federal sales tax (GST) and the price goes up further, by about 13%.

reply to this comment

JRobUSC - 2/28/2008 6:15:51 PM

+1 Boost

what's the typical income for Canadians relative to the U.S. dollar?

Steve - 2/28/2008 6:40:40 PM

+1 Boost

JRobUSC asks "what's the typical income for Canadians relative to the U.S. dollar?"

My understing is that the earnings are pretty similar (e.g., a job that pays US$50K in the US pays about CAD$50K in Canada). That used to be a much worse story around 2000 when US$1 cost CAD$1.60. The big differences are in income tax, retail prices, retail taxes, and other taxes. So the Canadian whose "typical [pre-tax] income" is something that an American can relate to, has considerably less spending power.

EnnNorak - 2/28/2008 6:56:32 PM

+1 Boost

I live in Canada and I am boycotting manufacturers who continue to screw Canadians with their Canadian pricing policy. I would like to see all cars sold in Canada in U.S. dollars at U.S. MSRP. Auto makers should organize their zone offices as if the Canada/U.S. border did not exist.

For all you Canadian nationalists who see this as a first step toward Canada becoming the 51st state, let me remind you that we are already each other's largest trading partners and we share common business practices and a common business language.

I see a common currency and even greater trade ties being implemented sooner than later. With global problems being what they are, I'm a firm believer in Fortress North America -- and don't worry Lou Dobbs I'm not advocating unfair trade arrangements here.

A more open border between Canada and the U.S. would release many border guards for duty elsewhere where borders are currently unsecure.

reply to this comment

Steve - 2/28/2008 9:32:58 PM

+1 Boost

Just as a data point, the US is Canada's largest trading partner, both interms of Canadian sales into the US, and Canadian purchases of US goods. However, China has recently displaced Canada as the US's biggest trading partner.

rok_altima - 2/29/2008 11:54:25 AM

+2 Boost

This cannont be done. You cannot take exchange rates and use them to compare cost of living because they are two different currencies and two different economies. The cars that are sold in Canada go to pay Canadian workers, Canadian transporters, Canadian dealer networks and other things that are all related to the Canadian dollar. When the Canadian dollar was worth a little more than half, no one was complaining. You can't change just because exchange rates do, if the Canadian economy were to plummet, then these cars would be given away for free. its called exchange rate risk. Nor is it good to have continually fluctuating prices from a business- customer relationship standpoint.

Bmw8ter - 2/28/2008 7:19:42 PM

+3 Boost

Try buying jewelry up there. I saw a nearly identical piece while I was living in Toronto, in Rochester, NY(I say nearly identical because they were pretty much the same, but no telling). The price in Toronto was about 3 times more expensive. I asked a jeweler once about the Canadian pricing of jewelry; she said it had to do with gov't influence.

reply to this comment

huu76 - 2/28/2008 8:06:07 PM

-1 Boost

Steve,
The problem is that CAW workers get paid $30+/hr, while UAW get around $$24/hr to start.

I'd love to see American prices on our cars, but in this case, I doubt you'll see it happen except the token gesture here and there.

If parity drags on for too long (i.e. 2 yrs or more), the only way our prices will drop is if production goes back to the US (or Mexico).

Everybody who was loving parity didn't look far enough into the future, they only cared about cheaper vacations.

Taxes are too high, but universal healthcare has a price, although I think if the leftwing scaremongers would shut up, introducing some public-paid private clinics would help lower costs and improve service. But that's just my opinion.

reply to this comment

Steve - 2/28/2008 9:37:37 PM

+2 Boost

I don't understand how your reference to CAW earnings and UAW earnings makes a difference when you consider than a US-branded vehicle made in Canada, sells for thousands more in Canada than compared to the same *Canadian*-made US-branded vehicle after it is shipped to the US. The cost is the same, made by Canadian employees. The retail selling price obviously has little to do with cost, or transportation.

The simple fact is that stuff costs more in Canada because that's what the market wlll bear.

writer - 2/29/2008 1:53:13 AMView My AgentSpace

+1 Boost

This is why I don't think I'll ever buy new; I just couldn't stomach the fact that I would be getting screwed on the deal.

I'm proud to say that I live in Brampton where they build the new Challenger, but I wouldn't be surprised if Dodge charges us more for the car compared to the States....

reply to this comment

stevenv1999 - 2/29/2008 9:30:50 AM

+1 Boost

This is the only way to expose corporate and government colusion is by sueing for unethical practices. I hope they expose this and other questionable practices that I am sure exist. It amazes me how tolerent the voting public becomes when we're talking about corporate greed. The oil cartel's are a great example of this. Just pay up is only response.

reply to this comment

mmeecc - 2/29/2008 1:41:35 PM

0 Boost

I am Canadian and my comment is not on cars built in Canada.
The canadians who are pissed off at prices are just ignorant or uneducated as to what goes into pricing these vehicles.
First of all, BMW Canada and MB Canada buy their cars from BMW and MB Germany, not USA. If any of you complainers know anything, you should know that price comes with volume. BMW Canada and MB Canada buy approx. 40,000 units (combined) per year, compared to "at least" 500,000 units in the USA. Do you think BMW USA and MBUSA pay the same price (on the promise of so many units) for their cars as their counterparts in Canada? Obviously not. (I've seen the invoices)
Now I know what you're gonna say, then why don't they buy them from the states? Hmmm.... American standard cars are different than Canadian standard cars, heated washer systems, corrosion proofed, block heater, etc. are all standard on canadian cars and not on american cars. And, do you think that you just start buying here and there as you please? Doesn't work that way.
What we're getting for our strong canadian dollar vs. the euro is more standard equipment, more perks. Most BMW and MB today are so much more car for the money today than they used to be. You can get a similar car with a lot more equipment and power for less money than 6 or 7 years ago. So what the hell are you complaining about? All other goods have gone up!!!! Corporate greed? Consumer greed is just as noticeable when you work with the public, they'd suck a company bone dry if they could and then move on to another company without guilt.

reply to this comment

Steve - 2/29/2008 4:33:41 PM

+1 Boost

mmeecc, you're ignoring a key point, and that is that the Canadian government has special requiremets for these specific premium vehicles that they don't have for other vehicles. For example, if a Canadian wants to import a BMW motorcycle into Canada (likely from the US, because Canadians pay about 30% more), then the Canadian who is importing this vehicle must get a special certificate that can be issued only by BMW Canada for a fee of several hundred dollars. I know several Canadians personally who have been affected thus. This requirement does not extent to any other motorcycle being imported into Canada. Similar gripes exist with BMW and Mercedes cars.

Judge for yourself how this several hundred dollar paper work benefits the Canadian workers, etc. It surely is not helpful for Canadian consumers. And it most certainly is not a fair practice that is applied equally "across the board."

mmeecc - 3/6/2008 4:57:55 PM

0 Boost

Steve,

So what's the solution? Close all BMW and MB dealers across Canada and have everyone import from the US?
This is like someone going to the corner mom & pop store and asking them to sell their products the same price as Wal-Mart. So you know what, every business should close and we should just have Wal-Marts all over the place... That's your and seemingly every Canadians' business logic...

reply to this comment

Steve - 3/7/2008 2:30:47 PM

+1 Boost

mmeecc, your "suggestions" seem radical, to say the least, and nonsensical, to be quite candid. I, and others, are merely citing (a) government practices that are targeting specific makes rather than being uniformly applied, and (b) that Canadian retail prices in the examples provided are askew, big time.

reply to this comment

To post a comment for this story, you must first Login.

If you do not have an account, you will need to Register (It's Free!).