Mitsubishi Cross-Border Roadblocks

The lease on Ashley’s Mini Cooper is up in April 2008, so we’re looking at getting a new car in the spring. I’ve always enjoyed the look of Mitsubishi cars, and now that they’re being offered in Canada (that happened a few years back) I’m seriously considering either a 2008 Eclipse or a 2008 Lancer. Given the strength of the Canadian dollar, I figured I’d check into how much the cars are selling for in the US: I wasn’t overly surprised to see a 2008 3.4 litre engine Eclipse, fully loaded, selling for $30K USD. The same car in Canada? $36K CAD. No equitable pricing there. It’s always been less expensive to buy a car in the US though, which is why some Canadians will drive down and buy their cars in the US. There are costs involved in bring a car across the border, and some paperwork hassles, but $6000 is worth a fair amount of effort.

What was surprising to me was the conversation I had with the local Mitsubishi dealership: the saleman informed me that in October of this year, Mitsubishi segmented their warranty. Previously they offered a North-American wide warranty, meaning if you bought the car in the USA, you’d still have the 10-year warranty in Canada. No longer. If I were to buy a 2008 Eclipse in the USA and bring it up here to Calgary, I’d have zero warranty. Worse, they won’t even sell me a warranty – if anything went wrong with my Mitsubishi car I’d have to take it back down to the US to get it fixed under warranty.

I understand that Mitsubishi is under pressure from Canadian auto dealers to stop this cross-border buying practice, especially with the dollar disparity, but the solution would seem to be obvious: make the prices fair in both markets so buyers don’t feel like they’re being punished (price-wise) by purchasing from a local reseller. There will always be price discrepancies in different markets, but when I can drive down to Montana in five hours and buy the car for $6000 less…that seems a bit extreme to me. I don’t like it when companies use their power to abuse the consumer, so this is definitely a strike against Mitsubishi – the Eclipse and Lancer had better test drive damn good for me to continue to want one!

  • chrisgohlke

    Mitsubishi’s don’t seem to hold their value really well. If your up for paying $30K, I’d pay a few grand more and go with a G35 or G37. We bought our G35 new in 03 and it is probably the best vehicle we’ve ever owned.

  • Yeah? Hmm. Well, I don’t ever really think about cars being an investment in any way, so a car holding value isn’t too important to me (maybe I’ll feel different if I ever sell a car – my Mazda Protégé 5 is the first car I’ve ever owned rather than leased). The G35’s look nice, but they START at $40K CAD and go up from there. So it’s a really different calibre of car than something that starts at $25K. I have a moral objection to buying a car that’s too expensive – I start to get really uncomfortable when I go over $30K because I think many people buy cars as status symbols rather than tools to drive (I’m not saying that’s you ;-)). I’m not going to go out and get a $10K Kia mind you, but I think there’s a reasonable middle-ground for a fun car that isn’t insanely priced.

  • T-Will

    Jason, have you checked out the Subaru WRX or WRX STI? They’re all-wheel-drive, safe, comfortable, quick, fun, easily modable, etc. I have a 2004 WRX and am extremely happy with it. The only mods I’ve done are a K&N drop-in filter, AccessPort ECU reflash, trailer hitch, and rimz, and I’m very satisfied with it. It wasn’t cheap, but I don’t think it’s out of the “moral” price range of a car.

  • chrisgohlke

    That is weird, here, the G35 starts at $31,600. It is probably one of the better bang for the bucks out there. Ours was nicely equipped and only was about $5,000 more than a comparably equipped Accord or Camry.

  • I haven’t really looked at the Subaru’s to be honest – the WRX does look pretty sweet.

    GAH! The The 2007 Impreza WRX STI starts at $48,995 CAD.

    Oh, I see, the WRX starts at $32K. Not too bad – maybe I’ll take one for a test drive, thanks for the suggestion! 🙂

  • Chris,

    Count yourself lucky that you life in the land of less-expensive cards – we get screwed up here in Canada on vehicle costs…even when many of the parts and assembly is done in Eastern Canada.

  • chrisgohlke

    Too bad car companies only think about being global when it benefits them. They seem perfectly happy to segment the market when it works for them.

    I think the people of the US (especially those already living beyond their means) are in for a rude awakening over the next decade. The fall in our dollar and rising gas prices are certainly changing the playing field. On the plus side, this might help change attitudes that the “American Dream” has to be a huge house and two new cars in the driveway.

    I’m actually considering one of these for our next car – http://en.wikipedia.org/wiki/Fortwo – but no matter how cool and efficient it is, it is hard to justify trading in vehicles that run great and are paid off.

  • idawgik

    If you’re looking at the Subarus, you might want to also consider the regular Impreza. Basically, the WRX is the Impreza with the turbo and a few other enhancements. I’ve had my Impreza 2.5RS since Feb of 2005, and I love it. Does really well in bad weather here in Denver and doesn’t cost as much as the WRX. And like the WRX, it’s available in a sedan or a station wagon if you need the extra room.

  • Cold Flame

    Jason,

    I’ve had some experience with Mitsubishi, and though I like the look of them, I find they tend to be very cheap in the longrun. I personally have met a Mitsubishi mechanic who works at Platinum (I believe that’s the NE dealership here in town) and he doesn’t recommend buying them. They’re designed to go their obligatory 160,000 km’s and then they die/fall apart.

    Subaru’s are great vehicles; too bad they’re poorly marketed and not very mainstream. The WRX & it’s STi brother are great cars. Very reliable, and incredibly safe. I’ve heard all good things about all lines of Subaru over the years but have never had the chance to drive one unfortunately…

    My Mom has a G35 (’04 I believe) and it is a gorgeous car, but it was about $50k from Hyatt. Ridiculous price, especially considering what Chris bought his for. It is an unbelievable car though, and even her 4-door model is a dream to drive (VERY FAST!) and handles incredibly. I’ve had that car at 235km/h and it still wanted to go. No idea where the governor kicks in (if there is one).

    As far as the cross-border pricing, not all companies are blocking you from importing vehicles, though a few major ones are. The US dealerships have been specifically told NOT to sell to Canadian buyers for the reasons talked about above; however, that’s not to say you still can’t. The Ford companies (BMW/Jag/Volvo, etc…) still give you a North American warranty. GM, Honda, & Mitsubishi will not. I can’t remember for Toyota and for Daimler-Chrysler (Dodge)….

    I read an article about a month ago about a couple from Ontario somewhere’s who priced out a loaded Lincoln Navigator (75k CAD with all the options they wanted). They thought that price to be a little high, so they started researching on the Internet and found the EXACT vehicle in the US for 45k. So, after exchange, I think at that time it was 43.6k CAD, and then they had to put about 6.5k into it for GST and the small import fees you have to pay to get it across the border, the inspection, etc… Ultimately, they saved $25,000 on an identical vehicle. Absolutely absurd!

  • chrisgohlke

    If the price difference is great enough, it might be worth the effort to take it back to a dealer in the US if you need warranty service. For some of the differences you are quoting, it could even work out to pay someone to shuttle it to the US for you.

    Hmm…. new cottage industry. Buy one of those truck that will hold 10 or 12 cars on the back and start a service shuttling cars from Canada to the US for service. While your at it, send down some of those inexpensive Canadian pharmaceuticals.

    Just curious, did you grow tired of the mini? A friend has the convertible and it is a blast other than feeling every bump in the road. Of course the convertible more than makes up for that.

  • Neil

    This topic has come up several times at work, Jason, with expats having parents who want to come down and buy a car. From what I’ve heard the US car dealers will specifically not sell you a car if they find out you’re trying to take it back to the US.

  • Cold Flame

    That is something that has been debated, Chris. People asking how often a warranty on a new car is actually used? Sure, there are usually minor things here and there that need to be addressed (squeaks, etc..), but typically new cars are fine from the get-go. To make up that $5,000 or $10,000, you’d have to be getting a lot of warranty service done to justify it, and that could easily be remedied by heading down for a couple of days (or paying someone to take it down as you mentioned).

    On another note, some Calgary dealers are starting to drop their prices to be more inline w/ their American counterparts. At the end of the day, it’s the Canadian divisions of the automakers that are charging these prices, not our local dealers. So it’s GM Canada, Toyota Canada, Honda Canada, et al. that need to be screamed at; screaming at our local dealers just falls on deaf ears as they’ve heard it many times before and likely wish they could match the US pricing so they could remain competitive.

    It’s just like your post about Amazon.com & Amazon.ca pricing, Jason; similar anyway.

  • As idawgik mentioned, look at the more baseline Impreza before starting to look at the more sports edition-like WRXs. Be sure to consider the Legacy model which is a bit bigger and maybe more suitable. And, you may want to hurry to your local dealer as they are selling out the 2007 Subaru models right now (according to http://www.subaru.ca). Although, the new 2008 Impreza might be worth waiting for, if that model is in the sweet zone, as there are some differences to the older models (like “softer” suspension).

    Subarus in general have feared well in owner satisfaction surveys (in various magazines and countries) and also quality statistics in Sweden and Germany (GTÜ), to name a few. The Forrester being the most reliable model that Subaru has, I believe.

    Finally, you Canadians sure got a fun commercial for the 2008 Impreza: http://www.youtube.com/watch?v=c2eHJO8J5-U 😀

    (In the light of that video, please don’t start to flame here if you like German cars/don’t like Japanese cars. There are car forums available on the Intarwebs for such bickering. 😉 )

  • Wow! So many comments….I guess I should have known that all guys have opinions about cars in some way. 😉 Thanks for all the feedback and ideas everyone! I’ll respond to a few questions:

    Chris: The Mini Cooper Ashley drives is still a great car, and quite fun to drive. It has a few quirks, but overall she still likes it a lot. We’d like to try something new though, and since she’s had a fun, fast car to drive the past four years, now it’s my turn. 😉

    Everyone who suggested Subaru: We’ll definitely take a look at them. They weren’t high on my list, but I’ll take one for a test drive and see what’s up.

    Cold Flame: I’m one of those guys that really believes in a warranty, just like life insurance. You hope you’ll never need it, but when you do need it, you really want to have it in place.

    Infinity: Sounds like a great car, but I’m really not comfortable spending quite that much money. Although maybe I’ll take one for a test drive and who knows…we’d probably buy the 2009 Camero if we could, but the damn thing isn’t out yet. 😉

    2008 Impreza: It looks so much like my Mazda Protégé 5 that I don’t think I’d want to get a car just like that. Although if it’s way more fun to drive, who knows, maybe I’ll sell the Protégé 5 and we’ll end up with two new cars. Doubtful, but who knows. 😉

    I’ll post about the test drives we take as they happen…feedback is always appreciated.

  • John Rudolph

    Jason, I was just looking for resources on the web to help a friend that owns a 2004 Mitsubishi lemon (Long story) when I ran across your blog. Nice to see that you are a fellow believer too.

    Anyways, on Subaru… I teach advanced driving skills as a part time volunteer for various car clubs. You own a Mini right? That is one fun and crazy car. It will be very difficult to match the bang for the buck and sheer fun factor of that car. Having said that, I currently own three Porsches, two Subarus and a SAAB Turbo. I’ve owned anything else that you can think of. My vote for the most fun and best all rounder? The Subaru WRX is the hands down winner. It may not out perform the Porsches but it has a raw sportscar feel that has made brands like BMW great. Unfortunately most manufacturers have homogenized and processed the visceral feel out of thier cars in hope of appealing to the broader market. It looks like Subaru did the same for 2008 although there are are lots of tuner shops out there that will gladly help you re-Subarize an ’08.

    So, my suggestion is get out there and find a nice 2007 Subaru WRX Sti (U.S. Autotrader is a good source) and grab it. Check out the advasnced driving schools at Race City once you get the car. BMW club has a great school at the end of May. Bring the car out (All makes welcome) and we’ll show you (Bring Ashley too) how to drive it FAST and safe without trashing it or causing premature wear to the car or it’s occupants.

  • John,
    Thanks for your comments, I appreciate them a great deal. The WRX STI looks like a great car, but it starts at $48K here and after I built it with the options I’d want, it was up to $51K. Maybe if I had an two hour daily commute I’d appreciate a $50K car, but I work from home and Ashley’s commute to work is 7 minutes, so dropping $50K on a car seems silly to me. $50K cars to me seem like status symbols (ok, not as much as a Porsche, but you get my meaning) and my status is not determined by the car I drive. 🙂

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  • Jason, it’s been three years and things have only gotten worse. I found this post looking up “Mitsubishi cross-border warranty”. As it stands now, a 2011 Lancer Evo MR costs $53,398 in Canada and $38,090 in the US. After you do the conversion at 1US = 0.98733 CAD that’s total savings of more than $15k or about a 30% discount from the Canadian price. “Outrageous” doesn’t say enough. 

  • Ouch! Mitsubishi must think us Canadians love to spend more money than we have to…