Canada and Cars

By September 27, 2007Briefly Legal, Trade

The U.S. economy also exports litigiousness.

The high Canadian dollar has demonstrated the difference between prices here and the same goods in the U.S. And now that gap may help a case wind up in court. A Toronto law firm has filed a $2 billion class action lawsuit against North American auto manufacturers, claiming they jacked up the price of new cars to discourage Canadians from buying an automobile across the border.

The suit covers anyone who bought a new car between August 2005 and August 2007 and names Honda, Nissan, Chrysler and the troubled GM in both Canada and the U.S., which is still reeling from the effects of a newly settled UAW strike. Both the Canadian Automobile Dealers Association and the National Automobile Dealers Association, a U.S. partner based in Virginia, are also cited.

Absurd that the courts should be involved in a matter of trade and currency. But …

U.S. businesses struggle under the excessive structural costs not faced by our major competitors, things like employee mandates, overregulation, high corporate taxes and tort costs. We do not endorse leveling the international playing field by making other economies less efficient (by, for example, adopting the U.S.’s awful system of civil justice).

Meanwhile, in other Canadian car news:

A prominent automotive industry analyst is saying that the deal struck between General Motors and the United Auto Workers to shift health-care costs to the union could herald “the darkest day in the history of the automotive sector in Canada.”

Dennis DesRosiers, president of Toronto-based DesRosiers Automotive Consultants Inc., has commented that the landmark agreement to establish a $51-billion retiree health-care trust for GM’s workers has essentially created a $25-per-hour cost advantage to build cars in the United States instead of Canada, once Chrysler and Ford follow suit.

Even with Canada’s single-payer health care system?

Leave a Reply