Selling the 2023 Z over MSRP

[takemorepills]

I guess selling over MSRP is only illegal in Canada if it involves new cars. Yesterday I looked at a 2019 370Z Coupe Sport 6MT with 33,000+ kilometres on it and a CarFax Report that showed it had 2 previous owners and had been involved in one collision. The dealer was asking $40,000 for it. Original MSRP was $34,198. Even if you allow for inflation, that's only $37,325. No thanks. If the car was a collector's item I would understand however I'm guessing a 370Z is not such an animal.

I'm not an expert in the Canadian market, but I've been following the Tundra rollout, which is getting huge markups. Canadians who are trying to buy the Tundra are reporting that dealers in Canada are actually finding ways to mark them up.... it's called dealer add-ons.
The real difference between USA and Canada new vehicle sales is that in USA a dealer is allowed to point-blank say they are increasing the price of a vehicle, without any material increase in what the customer receives.
In Canada, the dealers can add items and services, of dubious (I'd argue zero) value and charge whatever they want.

ADM isn't popular in USA either, and Toyota dealers in WA state have switched from charging ADM to now including "add-ons" that they sneak onto the vehicle before sale that can't be removed. They charge $3-4k for $300 in dubious products. Sometimes they sneak in window tint for $900, which is marginally valuable, of course the dealership probably pays $200 for it.
Anyways the Canadians are up to almost the same tricks as the Americans.

I think dealers actually prefer add-ons, because they're already part of the vehicle, the customer has less room to request lower negotiations, whereas ADM technically is open to negotiations

 

[Freewill]

In Canada, the dealers can add items and services, of dubious (I'd argue zero) value and charge whatever they want.

They can and try, however they are optional items that the accounting or sales manager will attempt to add at the close to a buyer that didn't do their research before walking in. Window etching, pre-paid maintenance, paint protection, etc usually added at a significant markup to what you would pay outside the dealership, but they sell you the advantage of it being priced into your car loan.

Being optional though, simply refuse the add ons at the hard close, or have a good idea of what these things cost outside the dealership and negotiate a fair price if you want the service, and want them to do it. It's still buyer beware here, but it is easier to avoid paying for extras and still get the car you want if you do your due diligence before walking into the dealership.

One other "Canadianism" we see is you don't pay tax on the full price of your purchase but the trade in difference. This is used by dealers to get you to accept lower than full trade in value since if you sell the car privately and then use cash instead of the trade, you would pay the full tax based on the close. On a 20,000 dollar trade in, that means three grand in reduced sales tax on the new purchase. Hence the dealer will normally offer you 17,000 for your trade arguing that the tax savings justify it. There is always room to barter though, and often if you get the dealer to split the difference it can be worth it. The sales tax varies from province to province but it is normally around 15% except in Alberta where it is only 5%.

 

[takemorepills]

They can and try, however they are optional items that the accounting or sales manager will attempt to add at the close to a buyer that didn't do their research before walking in. Window etching, pre-paid maintenance, paint protection, etc usually added at a significant markup to what you would pay outside the dealership, but they sell you the advantage of it being priced into your car loan.

Being optional though, simply refuse the add ons at the hard close, or have a good idea of what these things cost outside the dealership and negotiate a fair price if you want the service, and want them to do it. It's still buyer beware here, but it is easier to avoid paying for extras and still get the car you want if you do your due diligence before walking into the dealership.

One other "Canadianism" we see is you don't pay tax on the full price of your purchase but the trade in difference. This is used by dealers to get you to accept lower than full trade in value since if you sell the car privately and then use cash instead of the trade, you would pay the full tax based on the close. On a 20,000 dollar trade in, that means three grand in reduced sales tax on the new purchase. Hence the dealer will normally offer you 17,000 for your trade arguing that the tax savings justify it. There is always room to barter though, and often if you get the dealer to split the difference it can be worth it. The sales tax varies from province to province but it is normally around 15% except in Alberta where it is only 5%.

What the Canadian folks in the Tundra forums are sharing is that the "optional" items are "already on the vehicle" and can't be negotiated off. It's not much better than ADM, and dealers in USA like this tactic too.

In WA state, we also only pay sales tax on the new vehicle price minus trade-in. Although, I hear the money grubbing worthless politicians have their sights on that unusual perk.

 

[FBD]

What the Canadian folks in the Tundra forums are sharing is that the "optional" items are "already on the vehicle" and can't be negotiated off. It's not much better than ADM, and dealers in USA like this tactic too.

In WA state, we also only pay sales tax on the new vehicle price minus trade-in. Although, I hear the money grubbing worthless politicians have their sights on that unusual perk.

This doesn’t make any sense. I have never heard of or seen any additions added onto the car before purchase. The last brand new 370 I bought the additions come when you talk to the finance guy and they sell you the cosmetic package the extra coverage etc. etc. adding things on and charging for them is illegal in Canada. But if the consumer agrees to pay for extra coverage and services that’s on them and that’s completely legal.

 

[takemorepills]

This doesn’t make any sense. I have never heard of or seen any additions added onto the car before purchase. The last brand new 370 I bought the additions come when you talk to the finance guy and they sell you the cosmetic package the extra coverage etc. etc. adding things on and charging for them is illegal in Canada. But if the consumer agrees to pay for extra coverage and services that’s on them and that’s completely legal.

Why would it be illegal?

The dealership presents an item(s) and sells it for the value of the item(s). The vehicle and the add-ons both have a stated MSRP, so I would wager it's totally legal by Canadian law. The dealership likely has a right to add-on crap prior to posting the vehicle for sale. Dealership has no say in vehicle MSRP, but add-ons MSRP will definitely allow them lots of room for legal profit.

Out of curiosity, could you cite the Canadian law that doesn't allow a dealer to "install" add-ons prior to offering the vehicle for sale? I'd like to pass that information onto my Canadian friends

 

[kwantum_shift]

Why would it be illegal?

The dealership presents an item(s) and sells it for the value of the item(s). The vehicle and the add-ons both have a stated MSRP, so I would wager it's totally legal by Canadian law. The dealership likely has a right to add-on crap prior to posting the vehicle for sale. Dealership has no say in vehicle MSRP, but add-ons MSRP will definitely allow them lots of room for legal profit.

Out of curiosity, could you cite the Canadian law that doesn't allow a dealer to "install" add-ons prior to offering the vehicle for sale? I'd like to pass that information onto my Canadian friends

Are dealers allowed to pre-add on items for a vehicle that was ordered in specifically for one customer though, as almost all, if not all Zs that are coming in are? I get if it's a vehicle that's going into their inventory, they can add on whatever, and if customer doesn't want to pay it, they can order one without it or the dealer can remove the accessories. But I believe pre-ordered Z's will have VINs assigned, as they were ordered to our specs.

 

[takemorepills]

Are dealers allowed to pre-add on items for a vehicle that was ordered in specifically for one customer though, as almost all, if not all Zs that are coming in are? I get if it's a vehicle that's going into their inventory, they can add on whatever, and if customer doesn't want to pay it, they can order one without it or the dealer can remove the accessories. But I believe pre-ordered Z's will have VINs assigned, as they were ordered to our specs.

I would reckon that no, a dealer, either in USA or Canada, can not add items to an ordered vehicle.

That's where, unfortunately, USA dealers fall back on "ADM" because they'll definitely add ADM to reserved vehicles in the USA.

 

[FBD]

Why would it be illegal?

The dealership presents an item(s) and sells it for the value of the item(s). The vehicle and the add-ons both have a stated MSRP, so I would wager it's totally legal by Canadian law. The dealership likely has a right to add-on crap prior to posting the vehicle for sale. Dealership has no say in vehicle MSRP, but add-ons MSRP will definitely allow them lots of room for legal profit.

Out of curiosity, could you cite the Canadian law that doesn't allow a dealer to "install" add-ons prior to offering the vehicle for sale? I'd like to pass that information onto my Canadian friends

No I can’t cite any law. I’ve just bought enough new cars to know this has never happened to me. There’s nothing you could even add on to a Z. Like what examples of things are you thinking? All extra coverages are services they sell you after the fact. No dealer has ever installed anything on a car that I’ve bought in a desperate attempt at a cash grab.

 

[FBD]

Are dealers allowed to pre-add on items for a vehicle that was ordered in specifically for one customer though, as almost all, if not all Zs that are coming in are? I get if it's a vehicle that's going into their inventory, they can add on whatever, and if customer doesn't want to pay it, they can order one without it or the dealer can remove the accessories. But I believe pre-ordered Z's will have VINs assigned, as they were ordered to our specs.

No. They are not. And the car I’ve ordered is the car that I’ve personally spec.

 

[indio22]

No I can’t cite any law. I’ve just bought enough new cars to know this has never happened to me. There’s nothing you could even add on to a Z. Like what examples of things are you thinking? All extra coverages are services they sell you after the fact. No dealer has ever installed anything on a car that I’ve bought in a desperate attempt at a cash grab.

You show up to get your car, and the dealer has already put nitrogen in the tires, a ceramic paint prep, tint, etc. Suddenly you have several thousand dollars in dealer added items on the vehicle.

From what I've read on a Ford Bronco forum, that is happening to some customers. If the customer does not want those items, the customer can walk. But then, the customer doesn't get the vehicle. And with the popular vehicle, and other customers willing to throw money around, the dealer is likely ok with the original customer walking.

 

[takemorepills]

No I can’t cite any law. I’ve just bought enough new cars to know this has never happened to me. There’s nothing you could even add on to a Z. Like what examples of things are you thinking? All extra coverages are services they sell you after the fact. No dealer has ever installed anything on a car that I’ve bought in a desperate attempt at a cash grab.

I asked my local Toyota dealership if they had ADM on the new Tundra I was looking at.

They said "no ADM, but the truck comes equipped with our dealer packages pre-installed for $3,995" and I read up on the packages:
-nitrogen
-windshield treatment (WTF?)
-some weird brand I had never heard of for interior and exterior treatment
-tire and wheel guarantee for 1 year

Already installed. Don't like it? I didn't. I walked. Truck was still sold by end of day.

I'd almost prefer ADM as I'd rather hand over money to "charity" than have someone think I'm stupid enough to believe that crap has any value.

 

[West Aussie]

I asked my local Toyota dealership if they had ADM on the new Tundra I was looking at.

They said "no ADM, but the truck comes equipped with our dealer packages pre-installed for $3,995" and I read up on the packages:
-nitrogen
-windshield treatment (WTF?)
-some weird brand I had never heard of for interior and exterior treatment
-tire and wheel guarantee for 1 year

Already installed. Don't like it? I didn't. I walked. Truck was still sold by end of day.

I'd almost prefer ADM as I'd rather hand over money to "charity" than have someone think I'm stupid enough to believe that crap has any value.

Gee and they wonder why we don’t trust dealers…this is exactly why. Underhanded tactics does not install trust.

I’ve never heard of it being done in Aus either, but that doesn't mean this won’t be the first time

usually you buy your car, after the dealer has made a big show and dance about going back and forth to the manager to get the best price with trade ins etc…then you are shuffled into the “extras” office where they make you feel guilty for not buying their paint protection, window tinting, collision protection etc all of course at inflated rates ( usually just take mine to a company called Tint a Car in Aus on the day I pick it up and get it all done for the cost of one thing at the dealer), then you get shuffled into finance where you politely tell them, no thank you…I do not wish to pay your exorbitant interest fee

We may not have mark ups ( for which I’m truly grateful) but that doesn’t mean they still don’t try a trick or two

 

[Donalex]

It's actually the norm in most stores in the U.S. to add an Addendum Sticker. The products are called "hard adds" (something you can actually touch) and they are listed on an "Addendum Sticker" conveniently right next to the Mulroney Sticker from the factory.

"Soft adds" are things like warranties, oil changes (service contracts, etc) - stuff that only exist as a service and it's written in a contract.

If you want the vehicle, the dealer can insist you pay for and take the hard adds, but it's against Federal Law for them to force you to take any soft adds. Sometimes, they'll say "it's included in the price" and you HAVE to take it. That's also illegal.

It is also against Federal Law for dealers to remove the Mulroney Sticker and to print their own, so be armed with Nissan List Prices on the car and any official options done at the factory.

The Toyota Distributor in the Southeast ripped out the cloth interiors of incoming MR2 Spyders and installed aftermarket leather and other hard adds to jack up the price before it even hit the dealer property.

The Addendum Sticker will also list Market Adjustments, and is frequently used to make you believe you're getting a HUGE price on your trade-in but all they're doing is taking the "funny money" from the Addendum Sticker to add to the Actual Cash Value (ACV - and it's usually wholesale value). Don't think you can accurately value your car with NADA or KBB Trade-in Value.

 

[ceric]

Many dealers have new tricks to charge you extra.
They know it is easier for customers to swallow if they give customers something... instead of nothing.

Where I got my new '22 CX5 from, they had a Portofolio sticker package on new vehicles, and they charge for $899.
Cannot be taken off, they said.
Theft Deterrent - Portfolio (portfolioco.com)
I bet Portofolio charges them $100 or less.

Anyway, I got one from them at MSRP *before* they put those stickers on body panels. "That's an exception", they said.
After arriving home, I found that those stickers were already on, and they even put on McGard wheel locks.
Pretty sure I did not pay for them.

 

[FBD]

You show up to get your car, and the dealer has already put nitrogen in the tires, a ceramic paint prep, tint, etc. Suddenly you have several thousand dollars in dealer added items on the vehicle.

From what I've read on a Ford Bronco forum, that is happening to some customers. If the customer does not want those items, the customer can walk. But then, the customer doesn't get the vehicle. And with the popular vehicle, and other customers willing to throw money around, the dealer is likely ok with the original customer walking.

Sorry everyone. That never happens in Canada. I've never heard of that. But now you've got my interest up so I am phoning my dealer this morning to at least get a response. I'll have to take their word for it but I'll let you know what they come back with. There would never be a dealer that would add a "ceramic paint prep" to a car and mess with it one a spec order on a customer car. Makes me wonder how you guys down south have been getting the short end of the stick.