A tale of two Benzes. One costs much more than the other.

-From Automobiles de Luxe -

By Gunnar Heinrich

It's been some time - 10 years at least - since I last toured Mercedes-Benz of Vancouver's dealership. Situated just outside the main peninsula that's home to one of the world's coolest cities, the showroom had an air much like other Benz dealers I've visited.

Back then, the Canadian dollar (affectionately known as the "Loonie") was stable against the Greenback at around CAD $1.50 to US $1. This rate inflated consumer prices north of the border by at least one third if not more.

So, a Mercedes-Benz E320 that was sold Stateside for say US $50,000 likely sold up north closer to CAD $70,000. The stable, Greenback-centric exchange rate ensured that Benz's client in Vancouver was paying roughly the same amount as its customer paid in Seattle.

Well, times have changed...



Despite the U.S. Treasury lying through its many secretaries about advocating a "strong dollar policy," truth be told the current Administration has not intervened to save the dollar from sliding against other world currencies -ever.

And for the Canadian consumer whose purchasing power remains very much tied to its exchange rate with the US dollar, this has spelled disaster. The Canadian dollar has achieved parity with the US dollar for the first time since anyone can remember and prices on cars have remained inflated.

[FYI: As of 11/1/2007 1 CAD = 1.05 USD]

So, the customer who ventures to Phil Smart Mercedes-Benz Seattle will pay $42,995 for a 2006 SLK280 roadster with 6,500 miles. Two hours drive north, and a customer shopping for a 2006 SLK280 roadster with approximately 2,000 miles (3,200km) at MB Vancouver will fork over $58,800. That's nearly a $16,000 price difference.

Ouch.

The pricing problem does not affect Canadian Mercedes-Benz customers alone. The issue over pricing disparity is system wide and has only recently been getting overdue attention thanks to the widely covered fall of the the Greenback to the Loonie.

The only question now is how long will Canadian car buyers put up with the gouge?

[Sources: Phil Smart MB Seattle; MB Vancouver; Jaguar Richmond; Jaguar Seattle; Bloomberg.com; Google.com, Canada.com/nationalpost]