I’ve been following the issue of Canadian car prices since late September. Just before that, the Canadian dollar reached parity with the US dollar, which meant that the inflated car prices in Canada (compared with US prices) became even more inflated.
Porsche responded by trimming 8% off their prices and a couple of other companies have jumped on board so as to keep their Canadian dealers happy. Most haven’t though, including GM.
Canadian car buyers have responded by heading south in large numbers and purchasing their cars in the US. There’s charges involved with doing so, but if you’re buying a car in a higher price range then there’s still some big savings to be had. And in the true spirit of entrepreneurship, agencies have sprung up to help people to complete their US purchase.
As mentioned, GM hadn’t done anything to keep their Canadian dealers or customers happy, until now.
Whilst MSRPs will stay the same, GM Canada announced yesterday that they’d be introducing a new set of incentives that I’d guess are aimed at closing the parity gap.
Oshawa, Ontario (November 8, 2007) – General Motors of Canada today announced that, building on strong October sales growth and its hot new vehicle lineup, the company is introducing a series of new price incentives to augment its already highly competitive lease and finance rates.
Effective today, GM Canada will:
– Cover a 1% GST reduction for all of our cash and finance customers until the new GST rate takes effect on January 1, 2008.
– Offer new cash incentives ranging from $1,500 up to $10,000 on select models, including the Cadillac Escalade, Chevy Corvette, GMC Yukon and all of our 2008 Saab models.
– GM Canada is also today launching its year end “Wish and Win” event which gives GM customers the chance to win a new car or up to an additional $10,000 toward the purchase of their new GM car or truck.
“Coming off our strong October sales increases, we are moving beyond our great lease and finance rates to offer GM customers even greater value,” said Marc Comeau, GM of Canada’s vice-president of sales, service, and marketing. “We know consumers have been focused on the high Canadian dollar so we are going to continue to show them that the best value on the industry’s best vehicles can be found at their local GM Canada dealership.”
There’s no details in the release as to how much the incentive on the 2008 Saabs will be, so I’ll make some efforts to find out.