U.S. car dealer rejects Canadian shopper
A Calgary man is fuming after a U.S. car dealership refused to sell him a new car because he's Canadian.
Like many Canadians, Ken Wang planned to take advantage of the strong loonie and buy a car in the U.S. He intended to trade in his Buick for a new Lexus, figuring he could save as much as $20,000 if he bought the car in the states.
But when he contacted a Lexus dealership in Washington state, he made a rare discovery:A car salesman who refused to sell him anything.
He was especially surprised as to the reason why.
"They said, 'Oh you know what? If you are a Canadian resident then we can't sell you a new car,'" Wang recalled.
The dealers told him it was part of their franchising agreement.
Frank Lee, the general manager at a Lexus dealership in Tacoma, Wash., confirmed such a deal exists.
"It's a dealer agreement with the factory," he said. "We don't want to go into [Canadian Lexus dealers'] marketplace."
Wang called the practice "biased."
"How come, because we are Canadian, we can't buy a brand new car from the States? Why, because our money is different," he said.
Practice not illegal
Biased or not, it's not an unheard-of phenomenon in the states. Angry auto shoppers are typically referred to the Competition Bureau, which says there's nothing illegal about the practice.
Bureau spokesperson Chris Busutill said it's generally done to foil "arbitragers" — people who buy cars in the U.S. just to bring them back to Canada to sell at an inflated price.
Arbitragers stand to make good money by the practice since some U.S. and Canadian car prices are vastly different, even though the loonie is now closer to parity than in recent years.
The manufacturer's suggested retail price for a new Lexus ES 350 in the U.S. works out to $35,621 Cdn,while the same model costs over $7,000 more north of the border.
A new Honda Accord sedan costs over $3,000 more in Canada than the U.S., with a base price of approximately $24,000 in Canada.