Buying a car in the U.S.
 

many pros – many cons

 

This report was posted in the spring of 2008. To see an updated report click here

Due to the overwhelming number of requests for information about buying a car in the U.S., we've put together this report to help you decide whether buying a car in the U.S. makes sense for you.

As a general rule of thumb, most vehicles priced at less than $30,000 Canadian rarely make sense to buy in the U.S. and the more expensive the vehicle, the greater the potential savings.

The bottom-line is very simple. If the savings are big enough and the aggravation is small enough, it's worth it, otherwise it's not.

Since everyone's personal circumstances are different, please read carefully.


Latest News!

Canadian prices now lower! Canadian car companies have recently announced very attractive cash rebates, low interest rate loans and leases, as well as numerous other incentives to help offset higher Canadian retail prices.

Many of the most attractive cash rebates are secret and therefore not advertised. However, as a CarCostCanada.com member you will have full access to ALL Factory Incentive Programs.

Here are a few examples of the latest Canadian cash rebates/incentives and dealer discounts available to CarCostCanada.com members:

Save up to $30,000 off the regular prices on Canadian models

  • 2007 and 2008 Acura MDX – get up to $11,000 cash rebate depending on the year and model + dealer discounts of up to $3,000 + tax savings for a total of approximately $16,000 depending on the tax rates in your province.
  • 2007 Audi A8 – get up to $19,000 cash rebate depending on model + dealer discounts of up to $8,000 + tax savings for a total of approximately $30,000 depending on the tax rates in your province.
  • 2007 and 2008 Cadillac Escalade – get up to $8,000 cash rebate on all models + dealer discounts of up to $9,000 + tax savings for a total of approximately $19,000 depending on the tax rates in your province.
  • 2007 Ford Fusion – get up to $6,750 cash rebate depending on the model + dealer discounts of up to $3,500 + financing at 4.9% up to 60 months + tax savings for a total of approximately $12,000 depending on the tax rates in your province.
  • 2007 Honda Odyssey – get up to $5,000 cash rebate depending on the model + dealer discounts of up to $3,000 + tax savings for a total of approximately $9,000 depending on the tax rates in your province.
  • 2007 Lexus LX470 – get $9,000 cash rebate + dealer discounts of up to $8,000 + tax savings for a total of approximately $19,000 depending on the tax rates in your province.
  • 2007 Mazda 6 – get up to $7,000 cash rebate depending on the model + dealer discounts of up to $2,500 + tax savings for a total of approximately $11,000 depending on the tax rates in your province.
  • 2008 Nissan Armada – get $8,000 cash rebate + dealer discounts of up to $5,000 + tax savings for a total of approximately $15,000 depending on the tax rates in your province.

PLEASE DO NOT BUY A VEHICLE IN THE U.S.
UNTIL YOU HAVE READ THIS REPORT COMPLETELY

We have heard from many who have successfully bought and imported a vehicle from the U.S. and saved thousands. We have also heard many horrific stories. Please be very careful.

Our totally unbiased analysis is not intended to convince you to buy nor not to buy a car in the U.S. Our goal is to inform you of all of the pros and cons that you will have to consider, in order to make an informed decision.

Step 1: Can you import the car you want?

Many vehicle models are INADMISSIBLE into Canada, for example:

  • Most Audi models are OK (many V8 and V10 models are not)
  • Most GM models are OK (many 2008 luxury models and all SUV’s are not)
  • Most 2007 Honda and Acura models are OK (Most 2008 models are not)
  • Most Nissan and Infiniti models are OK (2008 Altima 4dr, Sentra SER, Maxima, 350Z and Rouge are not)
  • Most Subaru models are OK (2007 and newer Forester models are not)
  • Most Toyota and Lexus models are OK (2008 Yaris H/B, Corolla, Prius, Matrix, Sequoia, Sienna, FJ Cruiser, Tundra and Tacoma are not)
  • Most VW models are OK (2008 GTI & R32 are not)

Many makes on the list now have this new warning:

"Please, contact the manufacturer to verify the admissibility of the vehicle you intend to import into Canada."

For a full current list of ADMISSIBLE and INADMISSIBLE vehicles click here

Please note that this list is constantly being updated. Please check the latest version before buying your vehicle. If a vehicle is listed as INADMISSIBLE it cannot be imported period!

Step 2: How are you going to pay for it?

You cannot finance or lease a car in the U.S. You must be a cash buyer.

If you do not have the cash, you may be able to arrange a line of credit or other unsecured loan. Your other option would be to have a Canadian dealer buy and import the vehicle for you. Many are now familiar with the process. You would then be able to arrange a normal secured loan directly through the dealer or from your own bank.

Compare the cost of financing your U.S. vehicle at regular bank rates with the low rate financing and leasing deals typically available on Canadian models. You may find that once you add up the higher interest costs, it may not be worth it.

Step 3: Costs of Importing a vehicle

Over and above the cost of buying a vehicle in the U.S., you will also be faced a number of additional costs including:

  • Shipping and transportation costs - $500-$1,500
  • Customs brokerage fees - $200-$500
  • Import duties – 6.1% for vehicles built outside of North America
  • Federal air conditioning excise taxes and heavy weight taxes- $100-$500
  • Federal Green Levy / Fuel taxes on vehicles with poor fuel economy- $1000-$4,000
  • Miscellaneous other fees and costs- $200-$500

Step 4: Finding a Dealer to sell you a new car

Most car companies restrict their dealers from selling new cars for export. You may have to contact a number of dealers before finding one which will cooperate.

Used cars are typically not a problem.

Step 5: Finding the best deals, discounts and rebates

Check pricing carefully. Many U.S. dealers include rebates and discounts in their pricing that you will likely not qualify for.

Canadian car companies have recently announced very attractive cash rebates, low interest rate loans and leases, as well as numerous other incentives to help offset higher Canadian retail prices. Many of the most attractive cash rebates are not advertised.

Before buying a U.S. vehicle, get a CarCostCanada Wholesale Invoice Price Report which discloses all of the secret factory rebates and dealer discounts available to Canadians. In many cases, once you take the Canadian deals into account, buying in the U.S. may not be worthwhile.

To get your CarCostCanada Wholesale Invoice Price Reports click here

Step 6: Factory warranties

Some Canadian car companies will not honour warranties on U.S. purchased vehicles, even used ones. Notable examples include: Honda, Acura, Chrysler, Dodge, Jeep and Mitsubishi.

Please contact the customer service departments of the car companies of both Canada and the U.S. Tell them that you are planning to buy a U.S. car and that you want to confirm that the warranties will be honoured at Canadian dealers. Request a response in writing by mail and or email. Customer service 800 numbers can be found on the company’s websites, typically under 'contact us'.

Note: Free maintenance packages on U.S. models typically do not get honoured in Canada, even if they do honour the basic warranty. Ask about roadside assistance as well.

If warranties will not be honoured in Canada, you may be able to arrange to purchase an after-market extended warranty through a Canadian dealer. Otherwise, if you live close to the border, you will always have the option of taking your vehicle to the U.S. for any warranty work.

Step 7: Vehicle modifications and inspection requirements

Most ADMISSABLE models do not require any modifications to meet Canadian requirements. Avoid any vehicles that require modifications. Models with '**' or 'notes' next to their names typically require changing of bumpers or other modifications, which can be very costly.

All U.S. vehicles have speedometers and odometers in miles. Most speedometers also have kilometres shown on the inside of the circle. Some models allow you to change the display to kilometers where others do not. You can change the instrument cluster to the Canadian version, but this tends to be quite costly. It may also cause confusion at a later date when you trying to make a warranty claim.

More information can be obtained on the Government website for the Registrar of Imported Vehicles www.RIV.ca

You must supply a factory recall clearance letter to register your U.S. car in Canada. Many car companies are making getting the required factory recall clearance letter very difficult. For more information click here.

Modifications and inspection requirements. Please read the information after the link very carefully. Modifications and inspection requirements

To see a complete how-to-import list on the Registrar of Imported Vehicles website click here

Additional information and helpful links regarding importing a U.S. vehicle

RIV Contact Information

RIV FAQ's

Driving Television produced an excellent series of videos dedicated to the topic of buying a car in the U.S. To see all of the videos click here

CarCostCanada members can also get personal advice about buying a car in the U.S. vs Canada by clicking here

Online Forums: CarCostCanada has a forum where you can post your questions or comments. Click here

NOTE: Due care and consideration has gone into preparing this report and the contents of this report should be considered for discussion purposes only and should not be viewed as specific instructions as any one's personal circumstances may differ and therefore require professional direction and/or advice.

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