Tire Prices: USA vs Canada

[SubLGT]

".....The average automobile tire sells for $128.21 in the U.S., but the identical tire costs $169.69 in Canada, despite the U.S. and Canadian dollars being at near parity today.

This was the information provided by the Retail Council of Canada to the Canada's Standing Senate Committee on National Finance, in the committee's investigation of price discrepancies for consumer goods between the U.S. and Canada........."

"...........................Manufacturers give Canadian retailers three reasons for the discrepancies, the report said:

* Canadians are used to paying more for goods than Americans;

* Higher prices in Canada subsidize the cost of maintaining suppliers' offices and operations in Canada; and

* The higher prices are necessary to compensate Canadian distributors and wholesalers, which face higher costs in Canada than in the U.S...................."

http://www.rubbernews.com/article/20130220/NEWS/130229996/tire-prices-higher-in-canada-than-in-u-s

 

[dparm]

"Canadians are used to paying more"

...am I reading that as "we'll just continue to take advantage of people?"

 

[NMBurb02]

I bet it's mostly the last point, namely higher operating costs, but it probably isn't too much fun telling a government panel that you have to pay more in order to deal with higher taxes, regulation, etc.

 

[Tegger]

For various reasons, Canada is a very expensive place to do business. All of those reasons are related to taxation and regulation.

See this Letter to the Editor in the National Post, a major Canadian newspaper:
http://opinion.financialpost.com/2013/02/14/fp-letter-to-the-editor-cross-border-car-wash/

 

[dparm]

Originally Posted By: Tegger
For various reasons, Canada is a very expensive place to do business. All of those reasons are related to taxation and regulation.

See this Letter to the Editor in the National Post, a major Canadian newspaper:
http://opinion.financialpost.com/2013/02/14/fp-letter-to-the-editor-cross-border-car-wash/



Good read. Was not aware of the taxation happening up in Canada.

 

[Rolla07]

if i didnt get 50% off pirelli's up here in canada you can bet id be going to ny or vermont to buy them. ive been quoted 215$ per tire here, same tire in usa around 130$. i bought my rims in the usa and brought them across myself..usa has larger selection and better prices. plus most of our tax money goes in someones pocket. id rather give it to my neighbors to the south and help their economy. corruption...

 

[martinq]

Was always wondering why rubber is almost 2x the price up here. Thanks for the info.

 

[Stanley Rockafeller]

EVERYTHING is more expensive up here.

Which is why we like shopping in the states whenever we can (heck, my next car may be from there too!)

 

[SLCraig]

I am buying my tires state side from now on. I also grocery shop there about twice a month. I am sick of getting owned on the cost of everything here. You can get a gallon of milk for $2 in the US which is $5 or more here. Just disgusting.

 

[daves87rs]

Originally Posted By: SLCraig
I am buying my tires state side from now on. I also grocery shop there about twice a month. I am sick of getting owned on the cost of everything here. You can get a gallon of milk for $2 in the US which is $5 or more here. Just disgusting.


What!? Wow....

 

[martinq]

Originally Posted By: SLCraig
You can get a gallon of milk for $2 in the US which is $5 or more here. Just disgusting.

Mind you, our milk is still 'real' without hormones and such. Some of that $5 might actually be buying you something.

http://www.youtube.com/watch?v=JWw_P_CH638
http://www.uoguelph.ca/foodsafetynetwork/safety-canadian-milk

I'd still like to get tires for under $800 a set though.

 

[Garak]

Originally Posted By: dparm
Good read. Was not aware of the taxation happening up in Canada.


Much of what he says is true, but it's not always the case. We certainly do have businesses taking advantage of things. In a business like mentioned in the article, taxes, labour, and utilities are by far his biggest expenses. After all, a car wash tends to run long hours and runs on holidays. Its service is provided through municipal water (a utility). And running a car wash in Canada in January will run up a much bigger heating bill than running one in Texas in July.

However, these don't all apply to every business, nor do they apply to the same degree. Heck, even Walmart up here has started pricing oil (at least on rollback) at near U.S. style prices. They pay labour costs, too, and probably a lot more than they pay per capita on your side of the border.

CAA (our version of AAA) did a recent mini survey on car prices. Much of the same reasons were given, particularly that Canadians are willing to pay more. A couple examples of the vehicles were close to the same on both sides of the border. Some high end luxury vehicles, however, can actually be bought in the States, shipped to Canada, be fitted for Canadian regulations, and have duties and taxes paid, and still be several thousand dollars cheaper than the Canadian model.

The tire prices thing does bug me. Tires have certainly gotten better over the last number of years, and I'm willing to pay for progress. Prices have gotten more competitive up here, and the dealerships are actively trying to solicit tire business by offering fairly attractive pricing. Still, tires do not need to be twice as high up here as they are down south. Taxes and environmental fees on even a high end tire should not exceed $40.

 

[CapriRacer]

As many of you know, I work for a major tire manufacturer. It is quite clear the market in Canada is different than in the US.

For one: Winter tires. You just can not be in the tire business in Canada if you don't sell winter tires. So every 6 months, your in-store inventory completely changes. This plays havoc with the store's bottom line.

The other part of being in the winter tire business is the law of supply and demand.

I went to Tire Rack and put in a common tire size: 205/55R16. I got 166 tires. 46 Summer, 102 All Season, 13 Winter, and 5 Competition. Needless to say, the law of supply and demand is going to impact the winter tire business - less supply.

And here is where it get subtle:

If your business is mostly about winter tires, then winter tiresis going to drive prices. This is going to spill over into the other types of tires - driving those prices up as well.

Another part - which was somewhat alluded to - the distances. While much of the Canadian population is near the US border, there is a significant population well away from the border. You'd think that would mean that near the border, the prices would be significantly lower. (I haven't done a survey, but I'll bet they are!) - BUT - if chain stores (where the increased volume results in lower costs) put up stores away from the border, the prices in those stroes can't be significantly higher. Print and broadcast media can easily cover those distances and that drives the prices to be more even over the region - and the region ends at the border.

So I would expect that all other things being equal, that the prices in the US would be lower than in Canada.

 

[cp3]

Originally Posted By: Stanley Rockafeller
EVERYTHING is more expensive up here.

Which is why we like shopping in the states whenever we can (heck, my next car may be from there too!)


Here's an example....

2 O2 sensors for the G5, RockAuto (including exchange, tax and shipping) $108.54. Oh, and I ordered Monday, delivered Thursday.

At Canadian Tire $229.37 (including tax)

Living in Canada....priceless

Don't get me wrong, I've pretty much given up on complaining about this, I'm not picking up and moving to the US so it is what it is. It does however still amaze me at the difference sometimes.

 

[Garak]

Originally Posted By: CapriRacer
I haven't done a survey, but I'll bet they are!


You'd be quite right on that. Even in smaller towns, it's common for people to drive to the city for major purchases, and that includes tires. Many small towns do certainly have quality tire shops, but they're simply not able to compete, except, I suppose, for some rural niche products.

 

[Papa Bear]

Originally Posted By: dparm
Originally Posted By: Tegger
For various reasons, Canada is a very expensive place to do business. All of those reasons are related to taxation and regulation.

See this Letter to the Editor in the National Post, a major Canadian newspaper:
http://opinion.financialpost.com/2013/02/14/fp-letter-to-the-editor-cross-border-car-wash/



Good read. Was not aware of the taxation happening up in Canada.


Not sure that taxes are the problem. I think it's just the way it's been and the way it will continue to be until Canadians stand up and complain.

I can go to Detroit (about a 1/2 hr drive) and get a set of new tires, come back and pay all applicable taxes and duties at the border and be hundreds ahead.
Who would get those "hundreds" had I bought the tires here?

 

[GenSan]

I see an abundance of Canucks enjoy making a trip to all the outlets along the border States for some shopping so do they shop for tires Stateside to save money as well?

 

[Spazdog]

I think Canadian cigarettes come in 25 packs instead of 20 to deter smuggling. They were like $10CDN a pack when they were less than $5 in the US. Don't know what they are now.

I don't know how they would do that with tires.

Western Auto used to sell several tires at $15.99 each: 155/80R13, 205/75R14, and 235/75R15. We would get a shipment in and sell out that day. Apparently, there was enough profit to just take them to Mexico and sell them there. Stores in the Valley started to limit sales so the entrepreneurs would just travel further north to buy them. They would take any old removed tire that had tread left too.

Man! set me up at a Canadian flea market with a tire mounting machine, balancer, and compressor and an 18 wheeler full of common tire sizes.

I'll make a killing!

All I gotta' do is get them across the border!

 

[Rolla07]

Originally Posted By: CapriRacer
As many of you know, I work for a major tire manufacturer. It is quite clear the market in Canada is different than in the US.

For one: Winter tires. You just can not be in the tire business in Canada if you don't sell winter tires. So every 6 months, your in-store inventory completely changes. This plays havoc with the store's bottom line.

The other part of being in the winter tire business is the law of supply and demand.

I went to Tire Rack and put in a common tire size: 205/55R16. I got 166 tires. 46 Summer, 102 All Season, 13 Winter, and 5 Competition. Needless to say, the law of supply and demand is going to impact the winter tire business - less supply.

And here is where it get subtle:

If your business is mostly about winter tires, then winter tiresis going to drive prices. This is going to spill over into the other types of tires - driving those prices up as well.

Another part - which was somewhat alluded to - the distances. While much of the Canadian population is near the US border, there is a significant population well away from the border. You'd think that would mean that near the border, the prices would be significantly lower. (I haven't done a survey, but I'll bet they are!) - BUT - if chain stores (where the increased volume results in lower costs) put up stores away from the border, the prices in those stroes can't be significantly higher. Print and broadcast media can easily cover those distances and that drives the prices to be more even over the region - and the region ends at the border.

So I would expect that all other things being equal, that the prices in the US would be lower than in Canada.



Tires that are made in canada cost more in canada than in the USA. alot of the difference relates to tax

 

[eljefino]

Originally Posted By: Spazdog

Man! set me up at a Canadian flea market with a tire mounting machine, balancer, and compressor and an 18 wheeler full of common tire sizes.

I'll make a killing!

All I gotta' do is get them across the border!

Get some kids "inner tubing" on the St. Lawrence river. Strap a tire to the bottom of every inner tube. Portage out opposite where you portage in. If a Mountie asks why you're pulling a tire up the river bank just say you're cleaning up litter like any good