I'm a gearhead. That's gearhead speak for "I like cars." Unfortunately, cars are depreciating assets, and the ones I like have a funny habit of being the most expensive.
With the loonie appreciating against the greenback, there is bound to be renewed interest in importing cars from the United States. With a comparatively weaker U.S. economy to boot, there are a lot of sexy cars on the market, as Americans unload their luxury items.
The savings vary, but comparing prices from both markets doesn't take much time.
Autotrader has sites for Canada and the United States, and I've been fantasizing about a Porsche Cayman for years. In less than five minutes, I found a 2007 base model Cayman with 36,000 kilometres in Ontario for $38,000. The same year and model was available in the United States for only $31,000 (U.S.). The U.S. car had almost 10,000 fewer clicks on the odometer. So without doing much digging, we're starting at almost $7,000 in potential savings. I say "almost" because this assumes the loonie is at parity with the U.S. dollar, but we also have to factor in the cost of the foreign exchange conversion.
The spread can be quite different depending on the make and model you are looking for. Some vehicles won't show much savings after factoring in the charges and fees associated with importing from the United States. On the flipside, others may be more attractive.
If you've found a U.S. car you love at a good price, the next step is to check to see if it is eligible for import. This can be easily done by checking with the Registrar of Imported Vehicles. Bookmark that site as it provides everything you need to know about importing a car.
Next, check to see if the warranty is honoured in Canada. Some manufacturers do, and some do not. If it isn't, you can look into third-party extended warranty providers, and don't forget to include this cost in your calculations.
You'll also have various fees and levies. Since a Porsche Cayman is manufactured outside of North America, it gets slapped with a 6.1-per-cent duty. You are also required to make sure that all recalls and required modifications are up to date. In the case of Porsche, a standard $500 (Canadian) charge is applied, which covers the look-up of the recall history of the vehicle, installation of daytime running lights and the other modifications required to be street legal in Canada.
Here's a comparison of costs for the Porsche:
Imported across border
Purchase price: $31,000
Air conditioning excise tax: $100
Duty: $1,897 (6.1 per cent on vehicles not manufactured in North America)
RIV registration fee: $195
Green levy excise tax: $0 (Can be up to $4,000 for less fuel-efficient vehicles)
Vehicle modifications and recall letter: $500
Total after taxes, but before emissions test and licensing fees: $38,071.96
Purchase price: $38,000
Total after taxes, but before emissions test and licensing fees: $42,940
So in this case, we saved just under $5,000.
There is quite a bit more hassle involved when you import, so I strongly recommend you triple-check all the requirements and procedures if you are doing this on your own. An alternative is to secure the services of a vehicle-import broker, which can run about $1,000. The procedure is not something to take lightly. You don't want to arrive at the border and learn a form was incorrectly filled out and you have to leave your car in the United States for a few more days - or even worse, find out it wasn't eligible for import in the first place.
Finally, you'll have to budget for getting to the car and bringing it across the border. For a gearhead, the farther the flight, the longer the road trip. Cannonball Run, anybody?