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Showdown over cross-border car price disparity Add to ...

A $2-billion lawsuit against various auto makers and dealers over the higher MSRPs of cars in Canada compared with U.S. models is crawling its way through Ontario courts, but looks like it's headed for a legal showdown by this summer, when it appears it will either be settled or certified as a wider class-action lawsuit.

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The suit was originally filed in the fall of 2007, within weeks of the loonie reaching parity with the U.S. dollar for the first time in 30 years. The latest statement of claim alleges that auto makers and dealers on both sides of the border engaged "in unlawful activities or enacted policies or took actions to influence upward, or to prevent the reduction of, the price at which their dealer networks sold the Defendant Manufacturers' motor vehicles," while simultaneously working to prevent shoppers from crossing the border to purchase less expensive vehicles.

The suit is pursuing class-action status, and originally named General Motors, Ford, Chrysler, Honda, Nissan and BMW, on both sides of the border, as well as the national Canadian and American dealer body groups, covering new vehicles sold from September, 2005, to 2007. The suit argues that Canadians were charged between 25 to 40 per cent more in absolute terms for vehicles that were effectively identical to ones sold in the U.S.

In the ensuing years, the suit has changed substantially, as has the value of the Canadian dollar, with the plaintiffs dropping their claim against Nissan and BMW, as well as the American NADA. These actions suggest that Nissan and BMW both provided evidence as part of the discovery process that they did not act illegally to keep prices higher in Canada, even if the prices actually were higher.

The Canadian Auto Dealers Association earlier this year finalized a "mirror image" lawsuit to one brought in the United States in 2003, which alleged that most of the major U.S. auto makers and the CADA conspired to keep virtually identical but less-expensive Canadian vehicles out of the hands of American consumers. While the U.S. courts didn't find enough evidence against most of the auto makers to go to trial, Toyota's U.S. arm agreed to settle the suit for $35-million, along with a payment of $700,000 by the CADA, with both parties asserting that they acted lawfully, with no legal or factual basis for the lawsuit.

Updates on the Ontario case are periodically posted on juroviesky.com/classactions/carconspiracy, the website for law firm Juroviesky LLP. It's a case likely to receive more attention in the next few months as the Canadian dollar pushes up above par with the greenback.

Probe finds overcharging by repair shops

The annual undercover repair shop investigation by W5 and the Automobile Protection Agency aired last weekend on CTV and, once again, the vast majority of chain and private repair shops were found to overcharge customers to repair a single, simple mechanical problem.

Hidden cameras were installed under the hoods of various vehicles that had all been extensively serviced and then the battery cable was loosened. An undercover reporter was then sent to 30 private and franchised repair shops (no dealers) in Toronto and Calgary complaining about an intermittent starting problem which could be fixed by simply finding and tightening the battery cable, with the advisor's diagnosis and advice also secretly recorded.

The results? Of 30 repair shops, 22 received a Fail on the APA's pass-fail scorecard, with the vast majority recommending repairs, products or services that weren't needed. Most shops that passed charged between $40 and $200 for the diagnostic and repair. In one case, a bill for $2,271 was presented to the undercover reporter in Toronto, after charging for spark plugs, air filter, four new suspension struts and a starter, with a push for additional brake service. It was the highest bill ever paid by the APA in such an investigation, the consumer group said.

Calgary had proportionally much more honest or competent repair shops, but still only seven of 19 received a passing grade. In Toronto, only one of 11 shops received a passing grade, though a 12th shop was visited, but excluded from the results, as the chain's computers showed the vehicle had just been serviced at another location three days before.

To avoid such overcharging, the APA recommends getting a second opinion when unsure of suggested repairs. The full report is available online at ctv.ca/w5, as are response letters by Active Green+Ross and Canadian Tire.

Ram launches bargain pickup

A new bargain-priced V-8 version of Chrysler's Ram 1500 pickup has been launched, called the Express, which promises to offer the least-expensive V-8 and 20-inch-wheel combo on the market.

The Express will come standard with the 5.7-litre Hemi V-8, making 390 hp and 407 lb-ft of torque, and will be aimed at the entry-level and youth market that's most interested in customizing their rides, Chrysler says. A monochromatic paint scheme, fog lamps and aluminum 20-inch wheels are all part of the Express package, which will start around $27,500, or $1,000 higher than a base regular cab 1500.

Leaf test drives at weekend show

Nissan Canada will offer potential Canadian electric car owners their first taste of silent electric car driving this weekend, with public test drives of the BEV at the Green Living Show at the Direct Energy Centre at Exhibition Place in Toronto.

Between today and Sunday, show-goers will be able to sample the car on a short test loop.

At the Montreal and Toronto auto shows in January and February, the Leaf was not only roped off from the public, but locked as well. Strong reactions from potential Leaf buyers in Toronto led the company to unlock the hatchback over the last few days of the Toronto show, as well as at the following auto show in Vancouver. Nissan also likely noticed that the Chevrolet Volt parked nearby had a steady stream of curious show-goers hopping in and out of the vehicle.

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