It was only a matter of time before the Canadian arm of all the car manufacturers began to stir. They just can’t sit back and watch as consumers stop buying cars to wait and see when the prices will drop. Perhaps the biggest problem is how to react.

If new car prices are reduced, the dealer body will go insane over their existing inventory which was purchased at a higher rate. That and the effect on a lot full of recent used cars that would then have to be sold at a loss.

The solution seems to be incentives for cash buyers. Over the past few days, Mercedes, Chrysler and BMW have announced healthy incentives for cash purchases. How healthy? While I haven’t been able to confirm actual pricing yet, a reliable source at a BMW dealer gives an idea. Apparently the cash rebate on a 7 Series Beemer is somewhere north of $40,000. That actually seems a bit optimistic given the advertised pricing on a 750i in Canada of $108,500 and $75,800 in the States.

Either way, it seems the giants have awoken and are beginning to correct the pricing structure to reflect the stronger than ever Canadian dollar. Now, maybe consumers might start venturing into showrooms again.