Filed under: Car Buying, Porsche
Porsche responds to disparity in Canada by slashing 2008 prices
Thanks to a commenter on our previous post about the $2B class-action lawsuit being filed against automakers over the price discrepancy between cars sold in the U.S. and Canada, we learned that Porsche Cars North America is the first automaker to announce that it will be sharply reducing the prices of its vehicles sold in Canada. Overall, the price of a 2007 Porsche model compared to a 2008 will go down a full 10%, so a 2007 Cayman that cost $69,600 in Canada last year will cost $63,500 today. Unfortunately, a 2008 Cayman in the U.S. still only starts at $49,400, but at least it's something. Peter Schwarzenbauer, President and CEO of Porsche Cars North America, Inc., said yesterday in a press release, "We cannot ignore our customers and dealers in Canada who can look to the U.S. and recognize a substantial price difference." Unfortunately, this ginormous price difference still remains, as we illustrate after the jump. Porsche released a list of the new and old pricing for all of its models, but we went through the list and added the current MSRP for each vehicle in the U.S. The differences in price were so large to begin with that a 10% price drop across the board does little to reduce the disparity.
Nevertheless, Porsche does deserve props for at least acknowledging the disparity, though we aren't sure its actions to alleviate it will stop many from crossing the border to pick up their sports car from Stuttgart.
[Source: Porsche]
PRESS RELEASE:
Porsche Lowers Canadian Pricing for 2008 Models Compared to 2007
ATLANTA, September 25, 2007--- Porsche Cars North America, Inc. announced that it will lower prices in Canada by more than 10 percent on its 2008 models compared to prices and standard equipment on its 2007 lineup.
"We cannot ignore our customers and dealers in Canada who can look to the U.S. and recognize a substantial price difference," said Peter Schwarzenbauer, President and CEO of Porsche Cars North America, Inc. "We listened to the market and did what is best for our customers in Canada."
Porsche will lower the MSRP of its 2008 models by an average of more than 8 percent. Additionally, on an average equipment adjusted basis, 2008 models will offer another 2 percent in savings from 2007 models.
Prices for 2008 Porsches in Canadian dollars except where noted:
2008 Cayenne Tiptronic
2006/2007 MSRP: 64,300
2008 MSRP: 59,400
2008 Cayenne
2006/2007 MSRP: 60,100
2008 MSRP: 55,200
Current U.S. MSRP: 43,400
2008 Cayenne S
2006/2007 MSRP: 80,100
2008 MSRP: 72,200
Current U.S. MSRP: 57,900
2008 Cayenne Turbo
2006/2007 MSRP: 126,900
2008 MSRP: 115,300
Current U.S. MSRP: 93,700
2008 Cayman
2006/2007 MSRP: 69,600
2008 MSRP: 63,500
Current U.S. MSRP: 49,400
2008 Cayman S
2006/2007 MSRP: 83,300
2008 MSRP: 75,300
Current U.S. MSRP: 59,100
2008 Cayman S Porsche Design
2008 MSRP: 89,100
2008 Boxster
2006/2007 MSRP: 63,600
2008 MSRP: 58,100
Current U.S. MSRP: 45,800
2008 Boxster S
2006/2007 MSRP: 77,300
2008 MSRP: 70,200
Current U.S. MSRP: 55,700
2008 Limited Edition Boxster
2008 MSRP: 61,700
2008 Limited Edition Boxster S
2008 MSRP: 73,900
2008 911 Carrera
2006/2007 MSRP: 100,700
2008 MSRP: 93,200
Current U.S. MSRP: 73,500
2008 911 Carrera S
2006/2007 MSRP: 114,800
2008 MSRP: 105,800
Current U.S. MSRP: 83,800
2008 911 Carrera Cabriolet
2006/2007 MSRP: 114,800
2008 MSRP: 105,800
Current U.S. MSRP: 83,800
2008 911 Carrera S Cabriolet
2006/2007 MSRP: 128,900
2008 MSRP: 118,400
Current U.S. MSRP: 94,100
2008 911 Carrera 4
2006/2007 MSRP: 108,700
2008 MSRP: 100,400
Current U.S. MSRP: 79,400
2008 911 Turbo
2006/2007 MSRP: 170,700
2008 MSRP: 158,300
Current U.S. MSRP: 126,200
2008 911 Carrera 4S
2006/2007 MSRP: 122,800
2008 MSRP: 113,100
Current U.S. MSRP: 89,700
2008 911 Targa 4
2006/2007 MSRP: 119,100
2008 MSRP: 109,700
Current U.S. MSRP: 87,000
2008 911 Targa 4S
2006/2007 MSRP: 133,200
2008 MSRP: 122,400
Current U.S. MSRP: 97,300
2008 911 Carrera 4 Cabriolet
2006/2007 MSRP: 122,800
2008 MSRP: 113,100
Current U.S. MSRP: 89,700
2008 911 Carrera 4S Cabriolet
2006/2007 MSRP: 136,900
2008 MSRP: 125,700
Current U.S. MSRP: 100,000
2008 911 Turbo Cabriolet
2006/2007 MSRP: 171,000
Current U.S. MSRP: 136,500
2008 911 GT3
2006/2007 MSRP: 147,300
2008 MSRP: 133,800
Current U.S. MSRP: 107,500
2008 911 GT2
2008 MSRP: 235,400
2008 911 GT3 RS
2006/2007 MSRP: 171,200
2008 MSRP: 155,100
Current U.S. MSRP: 124,900
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Reader Comments (Page 1 of 2)
Farris 7:14PM (9/26/2007)
Alright, so here's my question:
What about the people that already bought 2008 MY Porsches? Do they get a rebate, like the early iPhone adopters?
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B-NOIT 7:17PM (9/26/2007)
Yeah. All of a sudden my mother is going from an '04 Malibu Maxx (which she purchased in Ontario) to an brand new Audi TT that she decided to buy in the States. They cost about the same thing. What the hell... 10% isn't enough, Porsche, but I do respect the move.
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AZ 7:19PM (9/26/2007)
Way to go Porsche, sadly I still can not afford one, at least the one I want.
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Evan Brom 7:27PM (9/26/2007)
This is a bad sign. Will we pay more if the USD keeps falling. I know importers at some point will need to raise prices to make a profit. I assume this is how we will be forced to buy domestic or Chineese as their money is tied to the dollar.
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BCM 7:42PM (9/26/2007)
It's been 3 decades since the Canadian dollar was last this strong, and during that time the US dollar has occasionally been worth almost 50% more. If it appears that the current differential will persist for some time, then prices should eventually drop because demand will decrease vs. supply; if demand persists at present prices there is no reason to lower them just because they are different in a different market. If manufacturers lowered prices to acount for all of the present currency value, they immediately depreciate all used cars, and late-model used cars in particular by an enormous margin. That would be good for people planning on buying a used car, but bad for all of the people suddenly upside down on car loans issued when the the Canadian $ was worth less than it is now.
Is the number of dealers per capita in Canada greater or fewer than the US? If fewer, the Canadian market would be normally less competitive and support higher prices.
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SPG 8:51PM (9/26/2007)
There are a lot more Porsche dealerships in the USA then Canada.
Per Capita.
Guy Legend 8:07PM (9/26/2007)
Good move for Porsche. They can say they lowered prices while still raping the Canadian consumer compared to an American one.
Prices needed to go down further. Hopefully, other automakers follow suit. Regardless, I'm glad this issue is getting lots of attention.
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James 8:26PM (9/26/2007)
Some economists in Canada make the argument that Logistics (Transportation, etc), salaries, advertising and overhead (Land and taxes) is higher in Canada to retail cars, and thus the higher prices. A $4000 price gap between a USA and CAN Pontiac ok i can see your argument. $13000 price difference between a USA and CAN Lexus I can not. My grandfather is a retired Ford CEO and I asked him the question. He replied, "simply because they are willing to pay more". Its the Canadian culture to be passive. ex: Look how much tax we have allowed the government to charge us Canadians.
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Craig 8:36PM (9/26/2007)
But at least you get health care, in the US if you get injured, you get raped.
But there is also the problem of a smaller market place. You have less cars to cover the admin costs for that brand, so the prices have to be higher. Also if the US and Canada got together and had identical auto standards, it would help close the price difference.
brianphilbin 8:51PM (9/26/2007)
Porsche.
The dollars are at par, so, please keep your prices at parity - there may be no substitute, but there are other places to shop...
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SPG 8:54PM (9/26/2007)
Craig
Free?
No, taxes pay for that but because you're used to paying taxes it does seem free.
I'm guessing that's what you ment.
However the healthcare system in Canada needs some serious work.
My buddy went in to get an infected toenail removed and he got a gender reassignment and a second anus!
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Elpincho 10:56AM (9/27/2007)
SPG: Craig never wrote the word "free". His point was: pay a little more taxes all the time, avert a bankrupcy when you need a bypass sometime later. Kinda the same as getting insurance, except nobody makes profit off what you pay and you can't be booted off if you need to much medical care for the insurer's taste.
SPG 11:44AM (9/27/2007)
Then he was thinking it.
I just know it.
Snowdog 9:53PM (9/26/2007)
This changes nothing, it only highlights the issue:
2008 Boxster
2006/2007 MSRP: 63,600
2008 MSRP: 58,100
Current U.S. MSRP: 45,800
It is still a huge difference and anyone with a clue will still import one. I might not go through the hassles for $1000, but for the still large $12000, no question. Though a Porsche is a little out of my price range, but at $45K USD a Boxster is getting closer.
Please leave health care out of it. WTF does that have to do with the price of cars? Nothing.
Any thing about differencing costs of doing business is pure BS. If there was truth to this, the difference in real prices would have been maintained when the dollar was low. It wasn't. In fact many cars were actually cheaper in Canada in those days.
It is currency fluctuation and resistance at all levels to giving up the now very juicy profits, and pissing off previous buyers and messing up residual calculations on leases.
They should have been making small corrections each year, rather than let it get this bad, but now at parity everyone is looking and they are pissed. If you want a real deal anytime in the near future, you will have to buy in the USA. If this difference exists when I am looking, I am going south.
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Barry M 10:27PM (9/26/2007)
You guys in Canada think you have it bad - in Australia the Caymen will set you back around $130k AUD, that's about $110k USD !!!!! A new 911 including on road is around $220k AUD - thats about $190k USD!!! BMW is no better - the new M3 in Australia is priced at $170k including on road- that's just over $140k USD!!!!!!! we are being seriously overcharged in Australia ...... and our gas is now at around $1.35 per litre for premium grade to run these cars on ..... ;( I'm moving to the US ;)
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JE 9:37PM (9/26/2007)
Yes, but how easy it is for somebody in Australia or Europe to buy a car from the US and import it into their country.
The reason why such prize disparities needs to be addressed in Canada is that it's very easy to just import a car from the US. Your total cost of importing a car is under $2000 for most cars and that's nothing compare to the $10K+ you'll save by doing this.
When the gap is this large people start importing. If it were less than $5,000, nobody would bother since the cost/"hassle" and local incentives would wipe out the difference.
Barry M 10:21PM (9/26/2007)
Fair enough JE .. I supose my point was more that Australia pays a lot more than most countries to enjoy the spoils of Europe's finest ....
Barry M 10:28PM (9/26/2007)
I think Canada is a bit like Australia in that Porsche delaerships know they are onto a good thing and are reaping the rewards of increasingly higher margins at the expense of fat cats who are typically too dumb or loaded to care .. consumers of these cars in Austalia are typically very wealthy and they probably like the fact that the price makes it exclusive ..(so everybody else can only buy a 3 series BM at best - 'let them eat cake' sort of thing) whereas in the US Porsche esp. Boxsters are relatviely middle class affordable.
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JunkStory 4:38AM (9/27/2007)
This is one of the best news I've heard in this week. I hope other car manufacturers will follow, because when I compare prices between Canada and US, the price for the exact same model is so disgustingly different that I only want to buy used cars.
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Random Task 7:29AM (9/27/2007)
I don't understand this phenomenon of people in socialist countries whining about expensive consumer goods? Do they not realize the two are not unrelated? When you (over) tax and regulate all aspects of an economy, you get high prices, especially given the relative size of markets.
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