Let's all take a deep breath and figure this damn price increase out....

I know of few people who calculate finance charges on a weekly basis. It’s usually monthly or on an annual basis. It reminds me of an impossible argument I was handed years ago, where I was asked to justify decreasing annual dollar payments but based upon a per diem (daily) basis, with the suggestion that a lower daily dollar amount wasn’t worth changing due to the small dollar amount involved (ie. no big deal, right?)

The fact is we’re into a time of higher interest rates, compared to our “low interest rate/low inflation honeymoon” that’s now over, so a measly 1% GM decrease in interest, is peanuts compared to the C8 price increase handed to Canadians. The timing of that interest offer on the part of GM, was no doubt planned to happen before vehicle price increases were announced. And keep in mind that vehicle interest charges, similar to mortgages, are COMPOUND interest rather than simple interest. So for example, a 6% compound interest rate easily translates into 8% annual/simple/actual interest. I say this to make a point (namely: a compound interest percentage rate sounds misleadingly low), not that the calculation coming up with 8% is 100% accurate.

Some like me were hard pressed to justify to our “better halves” buying a sports vehicle which is a selfish purchase and nothing that’s truly required for a family. In my case, I was out even further on a limb, trying to explain the extra $80K cost (minimum, depending on my trade value) of a luxury taxed loaded Z06 (everyone loads up their dream car, right?) compared to the C8 Stingray I already own. Then add another $25K+ suddenly dropped into that picture and there’s no way of justifying it.

Then look at others already juggling their finances and the statistics we’re routinely hearing about Canadians carrying the most debt ever. GM isn’t deaf and would know the effect of these record Corvette price increases: killing the dreams of many other Canadian Corvette buyers. A decision was made not to incrementally raise prices, nor (for example) do the same increase over a 2 year period to lessen the blow. Think about that. Certainly for the Z06 and E-Ray in particular, followed by the ZR1 and Zora, GM looks to be focused on the much smaller and wealthier exotic car buying segment, which will reduce the sales of those vehicles especially after most Canadian exotic car owners add one to their stable of cars, after which GM will have increased allocations freed-up for its overseas market to better cement its brand globally and (for example) more effectively try to push Porsche and other high end sports car manufacturers off their perch. Perhaps a sound global marketing plan, but w/o reducing US allocations and only hitting Canada with a huge price increase, it leaves Canadian Corvette buyers in the dust.

There weren’t that many C8’s making their way from Canada to the States. I know of some but very few new C8 buyers who were sanctioned by GM (blacklisted) and heard of a few more screened out by dealers worried about losing allocations. In my many phone calls to dealers across Canada looking for a C8 Stingray then after that a Z06, a common theme was a dealer not wanting to sell to me since I wasn’t known to them or was from out-of-province and they wouldn’t take a chance on me being a flipper. It appeared that most dealers had figured out ways to avoid Canadian buyers moving cars to the States.

That issue was NOTHING compared to the many dealers who tacked on an ADM for extra profit, with no sanctions by GM. If GM was focused on reducing ADM’s by dealers, it would have made a substantial price increase in the States as well. This didn’t happen; only in Canada.

Sorry to ramble. We’ll soon find out the effect of these price increases on the Canadian Corvette market. Common sense tells me it won’t be pretty especially when combined with our tougher economic times. GM with its legion of actuaries making calculations years into the future, has carefully planned this Canadian (only) ++++ price increase. GM knows the effect it’ll have on the Canadian market. Now we as Canadian Corvette buyers or (past?) “wanna-be” buyers must decide how we respond to GM for the Corvette and the rest of its product line. My 3 cents.
 
Mr.Corvette said:
The bottom line is this and I hated university calculus but had to do it, GM is not happy with the cars being exported from Canada to the US by flippers and this price increase is a direct result in an effort to stop it. They've estimated the this country will buy every Stingray, Z06 and E-Ray they send here and they want them to stay here. If we keep shipping them south they will cut our allocations and sell them to another country for a lot more profit.

Speak to your dealer, your cars worth a bunch more now and come spring they would want it as a trade in. Just be cautious of the luxury tax because while it's here, it doesn't roll over.
Click to expand...
When were C8's being exported from Canada to USA and how was it logical doing so? In Canada our used cars were 20-30k over msrp. In USA there already cheaper than Canada both new and used, plus wait times are extremely faster than Canada.
 
C82NV said:
When were C8's being exported from Canada to USA and how was it logical doing so? In Canada our used cars were 20-30k over msrp. In USA there already cheaper than Canada both new and used, plus wait times are extremely faster than Canada.
Click to expand...
I think it wasn't logical to import cars from most Canadian provinces with the exception of Alberta. 5% (Alberta) sales tax vs 13% + luxury tax (Ontario). But the US dollar was strong at 1.38-1.39x compared to CAD. GM was charging price based of an exchange of 1.24x, so there was opportunities for Americans to buy cars from Canada. However that no longer exists.
 
Mr.Corvette said:
So I'm talking to one of my contacts today and a customer who recently ordered a 2024 3LT loaded Z51 coupe calls to cancel and the order is already sitting at 3000 status. For those that don't know, there is an inside way of pulling the car back but it knocks you down the list about 3 weeks usually. It gets me thinking, how do we soften the blow? What makes a person lose his $2500 deposit due to the price increase? So again, lets look at the numbers!
How many of you know that GM recently lowered the finance rate on Corvette's to 6.99% which is lower than prime and 1-2% less than it was a month ago. On a 100k loan that's going to save you over $4100 in interest over 7 years by just being 1% lower.
Now let's look at the price increase of 12K on a Stingray. How much did you put down, was it $2,000 or $2500? My thought is that money's been gone for 2 years and you don't even miss it by now so for argument's sake lets call it a 10K price increase. (For Cam and all the others waiting to order an E-Ray that ship has sailed. GM moved the production date back until after the strike date which is at least October 23rd, there won't be any allocations for E-Ray's until after the strike date so next Thursday is out for getting any allocations.) The math for E-Ray works here at a 10K price increase. Let's break it down and use $10,000 price increase after your deposit. At the current 6.99% the extra cost on a 84 month term loan is an extra $23.44/week. That's it.
You saved $11.39/week by having a 6.99% finance rate compared to a 7.99% finance rate and the net cost of the extra $10,000 is $23.44/week.
For those putting 100K down on the car if you finance the balance with GM it's going to cost you $34.83/week for each $10,000 you finance. These loans are open and can be paid off at any time. For me in the past, when I'm buying out a lease or financing a lease buyout I usually pay the tax to get it out of the equation. Here the luxury tax in Ontario adds 20% and this was here before the price increase, so for us that adds an extra $2400 on the $12,000 price increase + HST of 13% on the $14,400 = $1872 giving us a total price increase of $16,272. Works out to $56.67/week. So, if we all just sit down and crunch the numbers, I think most of will realize that we can handle it by paying off a little more tax in the beginning finance the difference below prime for a difference of $25 buck a week. For the E-Ray folks the price increase with both taxes works out to $47.23/week. If you pay the $3560 in extra taxes on the price increase and just finance the price increase, it costs $34.83/week extra.
For our friends in Alberta, your numbers are better and for BC folks, find a friend in Alberta and get a P.O. Box there because I feel sorry for you guys. If you've saved over months or years for this car are you going to bail over less than $25/week? I don't think so!!
Scott
Click to expand...

Scott,
While I fully agree with your statement that most people will not bail because of the extra $25.00/week, it's not a very 'healthy' approach to personal finances (IMO).
It's called 'justification'.
It's minimalizing the adverse effect of a situation to suit one's personal desires.
These cars are toys, pure and simple, and if the decision on buying one or not hinges on one's ability to "handle it", perhaps another hobby is in order.
For anyone considering a purchase like this, with a minimal down payment, and a long term repayment plan, I urge you to look at the bigger picture first.
How much is this car, as beautiful as it is, truly costing you?
Take your deposit, and the cost of borrowing, plus insurance and maintenance, and all the other 'stuff', and look at how much has been spent by the time it's paid off.
At the same time, if that money was invested into an RRSP (or some other boring asset), what would you have?
Yes, you still have the toy, now 7 years old with a bunch of kms on it, and maybe it will be worth a bunch of money, or, maybe not.
Seriously, I'm not trying to kill anyone's dreams of having that shinny 'supercar' parked in the garage.
Try to keep in mind, however, that overburdening oneself with debt is a sure fire way of turning those dreams into nightmares.
Just saying.
 
mightymohito said:
I think it wasn't logical to import cars from most Canadian provinces with the exception of Alberta. 5% (Alberta) sales tax vs 13% + luxury tax (Ontario). But the US dollar was strong at 1.38-1.39x compared to CAD. GM was charging price based of an exchange of 1.24x, so there was opportunities for Americans to buy cars from Canada. However that no longer exists.
Click to expand...

Even in Alberta after a 20-25K msrp hike on used or new in stock models that would already eat any savings for a USA buyer. USA buyer would still even have to pay there local state taxes when crossing the border. What is funny is that various dealers were already putting 1 year liens on the vehicles themselves by blaming "exporting", but in reality were just upset they couldnt get there hands on potential profit as they would still let you sell or trade it back to the dealer within a year.
 
mightymohito said:
Look at the used C8 prices in Australia -

www.drive.com.au

Chevrolet Corvette Cars for Sale | Drive Cars For Sale

17 Chevrolet Corvette Cars For Sale from vetted, handpicked dealers - find the best Chevrolet Corvette deals and buy with confidence.
www.drive.com.au www.drive.com.au
Click to expand...
My understanding is freight is an additional $15,000 to Australia and New Zealand, the VAT Tax is an additional $12,000 on top of the HST and the cars start at $175,000 for a 2LT Coupe.
 
DW Ruby said:
Scott,
While I fully agree with your statement that most people will not bail because of the extra $25.00/week, it's not a very 'healthy' approach to personal finances (IMO).
It's called 'justification'.
It's minimalizing the adverse effect of a situation to suit one's personal desires.
These cars are toys, pure and simple, and if the decision on buying one or not hinges on one's ability to "handle it", perhaps another hobby is in order.
For anyone considering a purchase like this, with a minimal down payment, and a long term repayment plan, I urge you to look at the bigger picture first.
How much is this car, as beautiful as it is, truly costing you?
Take your deposit, and the cost of borrowing, plus insurance and maintenance, and all the other 'stuff', and look at how much has been spent by the time it's paid off.
At the same time, if that money was invested into an RRSP (or some other boring asset), what would you have?
Yes, you still have the toy, now 7 years old with a bunch of kms on it, and maybe it will be worth a bunch of money, or, maybe not.
Seriously, I'm not trying to kill anyone's dreams of having that shinny 'supercar' parked in the garage.
Try to keep in mind, however, that overburdening oneself with debt is a sure fire way of turning those dreams into nightmares.
Just saying.
Click to expand...
Darrell, I hate it when your right and wish you had stopped after your first sentence. I'm burning up the phone lines talking to people trying to confirm what I have been hearing for not months but years now about the exporting problem and the reasons why this massive price increase happened to just us and not south of the border?
Recently I have been telling people wanting the E-Ray pricing, take your Stingray and add 50K plus taxes and fees. Any way you slice it, this is a car that unless you have the money under your mattress is going to cost you over 7 or 8 years $150,000 to $250,000 when you add everything in. At the start of C8, GM wanted to attract a new younger demographic of first time buyers. Problem is they attracted too many when they priced the car at $59,995. They also had covid, parts shortages, shutdowns, tornado and all the other issues created lineups for this car they have never seen before.
I was just trying to soften the blow and sticker shock that hit on Tuesday, and yes it's going to cost a ton more and reduce the market but GM doesn't care. If we don't want the cars they will sell our 875 cars to Europe and Australia for $50K-$60K more than the new 2024 prices in a heartbeat just like they did in 2022.
I probably should have said nothing about the economics of it, you got all the likes, I got none, end of this thread.
 
Last edited:
netsinah said:
I know of few people who calculate finance charges on a weekly basis. It’s usually monthly or on an annual basis. It reminds me of an impossible argument I was handed years ago, where I was asked to justify decreasing annual dollar payments but based upon a per diem (daily) basis, with the suggestion that a lower daily dollar amount wasn’t worth changing due to the small dollar amount involved (ie. no big deal, right?)

The fact is we’re into a time of higher interest rates, compared to our “low interest rate/low inflation honeymoon” that’s now over, so a measly 1% GM decrease in interest, is peanuts compared to the C8 price increase handed to Canadians. The timing of that interest offer on the part of GM, was no doubt planned to happen before vehicle price increases were announced. And keep in mind that vehicle interest charges, similar to mortgages, are COMPOUND interest rather than simple interest. So for example, a 6% compound interest rate easily translates into 8% annual/simple/actual interest. I say this to make a point (namely: a compound interest percentage rate sounds misleadingly low), not that the calculation coming up with 8% is 100% accurate.

Some like me were hard pressed to justify to our “better halves” buying a sports vehicle which is a selfish purchase and nothing that’s truly required for a family. In my case, I was out even further on a limb, trying to explain the extra $80K cost (minimum, depending on my trade value) of a luxury taxed loaded Z06 (everyone loads up their dream car, right?) compared to the C8 Stingray I already own. Then add another $25K+ suddenly dropped into that picture and there’s no way of justifying it.

Then look at others already juggling their finances and the statistics we’re routinely hearing about Canadians carrying the most debt ever. GM isn’t deaf and would know the effect of these record Corvette price increases: killing the dreams of many other Canadian Corvette buyers. A decision was made not to incrementally raise prices, nor (for example) do the same increase over a 2 year period to lessen the blow. Think about that. Certainly for the Z06 and E-Ray in particular, followed by the ZR1 and Zora, GM looks to be focused on the much smaller and wealthier exotic car buying segment, which will reduce the sales of those vehicles especially after most Canadian exotic car owners add one to their stable of cars, after which GM will have increased allocations freed-up for its overseas market to better cement its brand globally and (for example) more effectively try to push Porsche and other high end sports car manufacturers off their perch. Perhaps a sound global marketing plan, but w/o reducing US allocations and only hitting Canada with a huge price increase, it leaves Canadian Corvette buyers in the dust.

There weren’t that many C8’s making their way from Canada to the States. I know of some but very few new C8 buyers who were sanctioned by GM (blacklisted) and heard of a few more screened out by dealers worried about losing allocations. In my many phone calls to dealers across Canada looking for a C8 Stingray then after that a Z06, a common theme was a dealer not wanting to sell to me since I wasn’t known to them or was from out-of-province and they wouldn’t take a chance on me being a flipper. It appeared that most dealers had figured out ways to avoid Canadian buyers moving cars to the States.

That issue was NOTHING compared to the many dealers who tacked on an ADM for extra profit, with no sanctions by GM. If GM was focused on reducing ADM’s by dealers, it would have made a substantial price increase in the States as well. This didn’t happen; only in Canada.

Sorry to ramble. We’ll soon find out the effect of these price increases on the Canadian Corvette market. Common sense tells me it won’t be pretty especially when combined with our tougher economic times. GM with its legion of actuaries making calculations years into the future, has carefully planned this Canadian (only) ++++ price increase. GM knows the effect it’ll have on the Canadian market. Now we as Canadian Corvette buyers or (past?) “wanna-be” buyers must decide how we respond to GM for the Corvette and the rest of its product line. My 3 cents.
Click to expand...
Change the last line to "my 7 paragraphs" and we are cool lol...
 
C82NV said:
Even in Alberta after a 20-25K msrp hike on used or new in stock models that would already eat any savings for a USA buyer. USA buyer would still even have to pay there local state taxes when crossing the border. What is funny is that various dealers were already putting 1 year liens on the vehicles themselves by blaming "exporting", but in reality were just upset they couldnt get there hands on potential profit as they would still let you sell or trade it back to the dealer within a year.
Click to expand...

I am involved in the used car/wholesale industry and I can tell you that very few CDN C8s go to the USA. For whatever reason, Americans do not want CDN C8s. I get the impression from US dealers that they think that CDNs drive their C8s in the winter.

The reason for the increase is pretty simple. GM isnt making enough money on them shipping them to Canada compared to other parts of the world. I can actually see Canada getting a lot more allotment of C8s now that GM isnt subsidizing the price on CDN units.

I was just talking to my GM dealer buddy today and he said that Yukons have gone up $6000 since May/23.
 
Zedder said:
I’d have to question the sanity of someone who would lock in for 84 months at 6.99%. I highly doubt that the current high interest rates will last for 7 years.
Click to expand...
If we do enter a recession, no one that has caused it will admit it, and the interest rates will probably drop. Again.
Central banks should split the interest rates between commercial and personal. Next time the SHTF, only lower the commercial rates, leave the personal rates alone (or maybe just a bit lower) and you won't paint yourself into a huge corner, when it comes time to raise them. Slowly.
 
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