Re: US car dealers turn away Canadian new-car buyers - is that legal?

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snipped-for-privacy@hotshit.com wrote:


You are missing the point of my original post.
I said NOTHING about the issue of EXPORTING or IMPORTING.
I an talking about a Canadian walking into a US car dealership and plunking down cash to buy a new car, then putting his own plates on the car and driving it off the lot. The Canadian customer is the one who will be importing the car back into Canada, and who will have to deal with any regulatory, compliance, or tax issues.
The point is that the US dealerships are saying that their franchise agreements prohibit them from selling cars to Canadians - the reason being that their sales territories (or customer residency addresses restrictions) are strictly defined in the franchise agreements.
I'm wondering if there are US laws (constraint of trade, etc) that would make such clauses illegal.
For example, can a General Motors franchise agreement in Dallas say that I am not allowed to sell a new car to a resident of Fort Worth? Would such a clause violate any existing state or federal trade laws?
If indeed Americans came to Canada 5 to 10 years ago and bought new cars (NEW cars) right off the lot, then why weren't the dealerships afraid of violating their franchise agreements? Weren't the same restrictions in their franchise agreements as we are being told are in the US dealer's agreements?
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I realize that this isn't exactly what you're talking about, but Pennsylvania has a 6% sales tax. Allegheny and Philadelphia Counties have a 1% sales tax, thus making a 7% sales tax paid on items purchased there. If a person goes to a surrounding county and makes a major purchase they can save 1%. BUT, eventually you will be billed for the 1% if the out of County dealer didn't collect it. And now they notify the county if you make major purchases other than vehicles, ie., appliances, furniture, etc..
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With a cash and carry situation, it is fairly simple to get around some taxes. Registering a motor vehicle is much different. I don't know how the Provinces work, but here, you cannot register a vehicle unless the proper taxes are paid. Importing can subject you to certain regulations also since the vehicle must comply with Federal regulations for emissions and safety.
All of that said, I don't see why a dealer should turn away a buyer that walks into his store. I can see where GM may want the dealer to refuse so they can keep the Canadian dealers happy, but I doubt any laws can be made.
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Canadian dealers have the same restrictions on selling new vehicles to US purchasers. There are even stickers on the vehicle that state "not intended for sale in the US', or something like that. There is no problem selling into neighbouring cities, or provinces, as I understand it, just across international boundaries.
Edwin Pawlowski wrote:

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Wes 94 ZR580 wrote:

My question remains.
Do US franchise agreements between CAR DEALERS ->and<- AUTO MAKERS (such as Ford, GM, Chrysler, Toyota, Honda, Nissan, Volkswagon, BMW, Mercedes, Volvo) stipulate that they cannot sell new vehicles to purchasers with out-of-boundary primary residential addresses?
Can a dealer in Michigan refuse a sale to a resident of Ohio, for example?
Are there not US trade laws (restraint of trade?) that would make such a practice illegal?
Would it be the case that the prohibition of selling to a Canadian customer is technically illegal, but the Canadian customer has no recourse under US law?
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There are no such laws. Franchise dealers have no obligation to sell to anybody, just as they have no obligation to sell at a particular price.
There are restrictions when it come to which VEHICLES can be sold in some instances, however. I. E. cars sold in states that do not require California emission system can not be sold in states that do, like the states in New England. Even that does not restrict the dealer from selling the car, but it does prevent it from being licensed in that state. In other words a vehicle without California emission, that would be driven only on private property, but not only the public highways, could be sold in a California emission only state.
mike

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Top Poster Mike Hunter wrote:

Can a Denny's refuse to serve or do business with black customers? There is no law against it?

Why would a franchise owner refuse someone paying MSRP, paying in cash (or bank draft, or some other registered security) ???
Why do US dealerships say that it's their FRANCHISE AGREEMENT that prohibits them from selling to Canadians?
What salesman would be happy with the franchise owner nixing such a sale?
Why are we hearing reports of US dealerships getting letters from auto makers reminding them that they can't sell to Canadians?
What about this:
http://en.wikipedia.org/wiki/Restraint_of_trade
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MoPar Man wrote:

I have no horse in this race, but from a legal standpoint, blacks are a protected class. Canadians are not.
Bill Putney (To reply by e-mail, replace the last letter of the alphabet in my address with the letter 'x')
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MoPar Man wrote:

Yes they have agreements that state where a dealer can sell vehicles. They don't restrict the dealer from selling to other customers they just state that Joe-Bobs Chevrolet will be the only authorized dealer for a certain area, and that the company won't set up another dealer for a set time period. As for restricting the sales to other areas, it depends on the federal and state emission and safety laws. In NY for example a NEW vehicle must meet NY standards (which are the same as California) You cannot buy a vehicle new in another state and register it in NY unless it meets those standards.
As for buying in Canada and registering it in the US. It is usually restricted due to the emissions and the high importation fees. Those are Federal importation rules. Same ones that apply if you buy a Ferrari and try to import it. They have to go through a Federal inspection and retrofit so they comply with the laws in the US. Doesn't matter if the car was bought in Canada or Africa they still have to be imported the same way.
The same import restrictions apply taking the vehicle into Canada. No laws saying that those restrictions are illegal exist.
The dealer can refuse to sell to anyone. They own the vehicles and can sell or not sell to whomever they please. They can even have you removed from the dealership and arrested for trespassing if they desire.
--
Steve W.
Near Cooperstown, New York
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Steve W. wrote:

there may be an issue with warranty as well. I had a Ram 3500 pick up come in with the check engine light on. we found it needed a gas cap but warranty would not cover it because the vehicle was manufactured and sold in Mexico. we were told the vehicle has no warranty in the USA.
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TNKev wrote:

For the last time.
This is not about warranties, This is not about emmissions or other regulations This is not about import/export issues, duties or taxes
This is about a Canadian walking into a US dealership and plunking down a money order or cashiers check for the full MSRP window-sticker (Monroney) amount for a given new vehicle (plus any applicable state or local retail sales tax) and loading the vehicle onto a flatbed truck and driving away with it.
Why on earth would a US car dealer turn away a sale like that?
The reason being offered is that the FRANCHISE AGREEMENT prohibits sales to Canadians. So I'm asking if such an agreement is legal, given restraint-of-trade laws.
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MoPar Man wrote:

Yes it is legal. Restraint of trade has NOTHING to do with Federal Import/Export laws.
--
Steve W.
Near Cooperstown, New York
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"Steve W." wrote:

Again, we are NOT talking about import or export issues. The US dealer is NOT involved in import or export activities when (or if) he sells a new car to a Canandian customer. It's the Canadian customer who must import the car into Canada - the dealer is NOT involved.
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MoPar Man wrote:

well fuck em.
i'm going mondya to bring a chevrolet halfton in to canada.
Hopefully shes all made in the USA and i don't have to pay any duty :)
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MoPar Man wrote:

maybe you should take this to misc.legal, it is already crossposted to 3 groups why not add a legal group since you are asking a legal question. you do know these groups are full of people who can tell you why your mini-van makes a rattling noise when driving over bumps but as far as legalities I don't think so.
unless you are just trolling. if so then excuse me I will get out of the way.
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TNKev wrote:

The NNTP server I'm using won't let me have more than 3 groups unless I specify a "follow-up to" group, which would make it difficult to follow the thread.

I'm thinking that someone in these three auto groups must know something about dealer franchise agreements - moreso that anyone in misc.legal.
There are many posts in this group that pertain to the relationships between car dealers and auto makers, so at one level my question about what is contained in those agreements is no different.
More generally, the design, manufacture, and operation of vehicles is heavily goverened by legalities, many of which are also talked about in these groups, so again the discussion about vehicles and laws are also not out of place here.

I am not trolling. Every day, as the Canadian dollar climbs above parity and appreciates in value has more Canadians shopping in the US for all manner of goods. When a Canadian can save at least $5k, and in some cases more than $20k for a vehicle, I'm sure you can understand why it is such a burning issue for those of us that are told by the US dealership that they can't sell us a new vehicle.
In the capitolist, freemarket land of the USA, a country boardering on recession, a vendor declines to do business with a customer. Where is the logic in that?
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wrote:

Pressure from the vehicle manufacturers. If they adjusted their CDN prices to no more than 10% above the USA prices this cross border shopping problem would not be such a big deal.
But Canadians are mostly all working and the car companies are greedy. They'll have to change. Those who don't want the hassle of buying a car in the USA may wait this out. The result will be lost sales.
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Oh, the car makers will change alright. But the change will not extend to their car pricing. They will simply apply their corporate resources to further tighten their manipulative take from Canadian consumers. This will involve both, the stick and the carrot approach, as it were. The stick: For example - lobby governments for stricter vehicle import/export policies, and/or take advantage of existing Canadian import restrictions by deliberately designing more of their U.S. dealer bound vehicles so as to NOT comply with Canadian RIV rules. The carrot on the other hand: For example - provide cars destined for Canadian dealers with sentimental token features designed to make the no-nonsense Canadian consumer feel all warm and fuzzy inside, such as replacing the brand name "Toyota" with "Kyota" (from Kyota Protocol), and the brand name "GM" to "GM Free" (meaning "This car was made with No Genetically-Modified food ingedients"), and throw in with the vehicle purchase, complimentary Carbon Credits as a commitment to an albeit unprovable yet very much in vogue climate hypothesis. :-)
Ken
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Ken Moiarty wrote:

That post was insensitive and uncaring!! LOL!
Bill Putney (To reply by e-mail, replace the last letter of the alphabet in my address with the letter 'x')
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I believe I see consumer resistance taking place. Near my house is a large lot that the nearby Honda dealer uses for excess new vehicle storage. The lot is about 0.5 km from the dealer and isn't too obvious from the street. I recently noticed more vehicles there than ever, in fact the numbers are increasing daily. The lot is nearing full.
Nothing is more effective than consumers stopping their purchases. No one likes to be gouged, even the rich.
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