Canadians not welcome at JD - USA

[Villengineer]

First, I don't see what NAFTA has to do with this. This is a corporate surcharge, not a government tax or tariff. I don't believe that NAFTA governs this particular situation, especially since it's applied to transactions going either direction over the border.

Second, is it fair? I would definitely be upset by it, but if we all knew how much of this type of charges/price adjusting is being made on all kinds of products we'd all be steaming all the time. It doesn't just happen with different countries b/c of currency fluctuations. For products which are sold through dealership type arrangments and not direct to the end-user it is the norm for the cost to dealer, dealer incentives, and even suggested retail prices set by OEMs to vary by location. Now you may find a published "global" MSRP, but there often regional MSRPs which aren't really made public for a lot of products, but which dealers are encouraged to target. The larger the manufacturer, normally the more common this is. Many companies, like the aforementioned CAT, also impose systems on their dealers where if they sell to an end-user not in their "territory" they either pay a "fine" or end up sending a percentage of the profit to the dealer whose territory the sale went into. I've heard all kinds of reasons for this, some make sense and some sound like a creative way to increase the OEM profit. But it's all legal, and the dealers are normally aware of it going in.

 

[Tractordawg]

I am afraid that is just the beginning of things to come from JD as they systematically push out smaller Mom & Pop dealers for the corporate conglomerates.

 

[canoetrpr]

Nobody would take this to a NAFTA panel over this - Luremaker is absolutely correct.

I cannot believe that if sufficiently challenged, these types of surcharges would not be found in violation of free and fair competition, let alone north american free trade. I think that dealers and companies get away with this because they have more lawyers that they can afford and no individual will stand up to them (or has the capacity to).

Case in point - class action lawsuit brought against the Canadian arm of auto makers (including GM) that found them fixing prices by using non tarrif barriers (like lack of warranty coverage) for vehicles purchased in the USA.

The reality is that no one has deep enough pockets to challenge an OEM in this way, or do we have the time to. The fact remains IMHO, that these practices are against both the rule and the spirit of an open, competitive marketplace and free trade.

 

[Robert_in_NY]

Nobody would take this to a NAFTA panel over this - Luremaker is absolutely correct.

I cannot believe that if sufficiently challenged, these types of surcharges would not be found in violation of free and fair competition, let alone north american free trade. I think that dealers and companies get away with this because they have more lawyers that they can afford and no individual will stand up to them (or has the capacity to).

Case in point - class action lawsuit brought against the Canadian arm of auto makers (including GM) that found them fixing prices by using non tarrif barriers (like lack of warranty coverage) for vehicles purchased in the USA.

The reality is that no one has deep enough pockets to challenge an OEM in this way, or do we have the time to. The fact remains IMHO, that these practices are against both the rule and the spirit of an open, competitive marketplace and free trade.

How is this policy in violation of anything? Deere has this policy in effect for both US and Canadian dealers so they are being fair in that regard. CAT has their sales territories which is much more drastic and no one has even thought about challenging them about it. The problem with this case is that Deere just set up this policy so some people are taking it personally (hence the title of this thread). With the way the internet has changed tractor buying the OEM's are trying to adapt to keep things fair to their dealers sales areas. New Holland made it harder on dealers who intentionally sold tractors to other states via Ebay and other online methods. I know people were upset about that also but as the internet grows the OEM's have to adapt. This can be both positive and negative for the dealers and the consumers.

 

[canuck50]

Nobody would take this to a NAFTA panel over this - Luremaker is absolutely correct.

I cannot believe that if sufficiently challenged, these types of surcharges would not be found in violation of free and fair competition, let alone north american free trade. I think that dealers and companies get away with this because they have more lawyers that they can afford and no individual will stand up to them (or has the capacity to).

Case in point - class action lawsuit brought against the Canadian arm of auto makers (including GM) that found them fixing prices by using non tarrif barriers (like lack of warranty coverage) for vehicles purchased in the USA.

The reality is that no one has deep enough pockets to challenge an OEM in this way, or do we have the time to. The fact remains IMHO, that these practices are against both the rule and the spirit of an open, competitive marketplace and free trade.

A class action suit has been filed aganist a group of auto companies who have bogus fees the charge to canadians who impost a US car. A local auto importer is funding the law suit. Apparently Volvo for example charges $1400 to inspect the car that they made after its is imported. It is so obvious the fees are just a way of discouraging cross border shopping. Its not working however as there are people bring cars accross every day. Auto companies have had to drop prices in Canada but there is still a big gap. I have no idea if its legal but it certainly is not free trade. Some people may be so green they will defend their color to the last drop of green paint.

 

[Villengineer]

A class action suit has been filed aganist a group of auto companies who have bogus fees the charge to canadians who impost a US car. A local auto importer is funding the law suit. Apparently Volvo for example charges $1400 to inspect the car that they made after its is imported. It is so obvious the fees are just a way of discouraging cross border shopping. Its not working however as there are people bring cars accross every day. Auto companies have had to drop prices in Canada but there is still a big gap. I have no idea if its legal but it certainly is not free trade. Some people may be so green they will defend their color to the last drop of green paint.

What's the average new Volvo actually sell for? I'd guess $25-30k US? They aren't cheap, I know that. So the $1400 fee is what's stopping the import of their cars across the border? I can't see that being enough to discourage anyone from importing them if the gap is as big as it sounds. IMO this is just another way for them to get a few more $ out of each sale. All the car OEMs and dealers try new fees all the time here. I've found that if they want to sell me a car, they make the fees go away or I go buy somewhere/something else.

Besides, you state a huge difference in the 2 situations as the lawsuit involves multiple manufacturers thus the possibility of price fixing. Deere is but one OEM, unless the other OEMs are following suit to prop up inflated prices across the entire market then it's really just bad business on the part of Deere. The other OEM dealers should be taking the opportunity to actually but a dent in the Deere dealer's sales.

 

[gemini5362]

After reading this thread I remember what I was told when I went to look at a Mercedes Benz a couple of years ago. I was interested in the new 350 SLK
None of the local dealers had one yet. I was in Memphis Tennessee on some buisness ( about a 5 hour drive from me) They had one and I was looking at it. The salesman asked me where I was from and I told him. The salesman said he would be glad to show me the car but he could not sell to me because there was a local dealer near me. If I wanted the car I could test drive his and look at it but I would have to have my local dealer order me one.

 

[canoetrpr]

I believe that such policies raise non tariff barriers to what would otherwise be free trade (inter-country, inter-state, inter-district - whatever). Like tarriff barriers, non tariff barriers artificially seek to keep the prices of goods higher in one trade region than another - which goes against the spirit of what free trade and open competition is about.

Economies are most efficient when barriers to trade are eliminated. Barriers that prevent (or artficially maket it more expensive) for one dealer from compete with another just because an OEM has artificially created a sort of an oligopoly by creating arbitrary 'zones' similarly restrict competition and keep the economy from reaching peak efficiency.

Companies that are doing this are shrewd - nothing wrong with that - businesses are just doing what businesses do - finding the best way to maximize profits.

 

[canoetrpr]

Lets turn the situation around little bit.

If I buy a hamburger from a Macdonalds in the next district, or an impact wrench from a Home Depot on the next town, is it either fair or clearly legal for them to ask me where I reside and charge me a different price for the hamburger or impact wrench depending on where I live?

I'd venture to say that the answer to this is not clear cut and does not get any more clear cut just because the goods we are talking about is excavators and tractors.

 

[Robert_in_NY]

Lets turn the situation around little bit.

If I buy a hamburger from a Macdonalds in the next district, or an impact wrench from a Home Depot on the next town, is it fair for them to ask me where I reside and charge me a different price for the hamburger or impact wrench depending on where I live?

Yes, it is fair. If you do not like the policy then you choose not to deal with them.

If I buy something online here in New York I have to pay sales tax according to my county sales tax rate. I am asked my zip code via the checkout procedure and it figures my sales tax accordingly. I do not care as I know I will have to pay this tax if I bought this item from a local store anyway. The reason I buy it online is because the local store does not stock it. If I buy something in PA or Ohio I am required to pay tax on it (except the only things I buy out of state usually are farm implements which are tax exempt). The snag here is that I have to keep track and report my out of state purchases on my taxes at the end of the year.

John Deere is not saying Canadians or American's "can't" buy from across the border. What they are doing is "rewarding" the customer who buys in his own country with a 7% "discount"

In the end it is up to the consumer to dictate the marketplace. John Deere makes good products but they are generally no better or worse then what you can get from the other OEM's. So if the consumer doesn't like the policy then buy from another OEM. If you just need to have that green and yellow paint then buy locally or pay the 7% fee.

The only three John Deere items I own are a 3300 combine from the 70's, a M tractor from the 50's and a running gear that came with a used bale wagon that I bought from a friend. I may add some new items if they are competitive or if they have something I really need but generally I buy from which ever dealer I trust and gives me a fair price for the item I need.

And if I was going to have to pay more for a hamburger to eat in the next county over then I would do so if I was hungry. If I was on my way home already then I would wait.