With all the lackluster offers Canadian manufacturers have been using to entice consumers to shop in Canada, it was only a matter of time before an underdog appeared with a real offer. Hyundai Canada announced today that it was offering an incentive package that ranges from $3,000 up to $5,500 on selected vehicles.

To put this in perspective, there is $3,000 on Tiburon. In Canada the Shark starts swimming for $18,995 while beginning at $16,695. With this incentive and the partial GST reduction Hyundai has on the go, it’s cheaper to buy a Tib in Canada than in the States.

Well done Hyundai!
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General Motors might be entering the financial abyss after showing a 38+ billion dollar setback a few days ago, but that is not stopping the company from offering a new round of Canadian incentives.

General Motors of Canada earlier today announced that, building on strong October sales growth and its” hot new vehicle lineup”, (straight out of their press release. My opinion is a little more staid) the company is introducing a series of new price incentives to augment its already highly competitive lease and finance rates. Effective today, GM Canada will:

- Cover a 1% GST reduction for all of our cash and finance customers until the new GST rate takes effect on January 1, 2008. - Offer new cash incentives ranging from $1,500 up to $10,000 on select models, including the Cadillac Escalade, Chevy Corvette, GMC Yukon and all of our 2008 Saab models.
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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.