I reckon Toyota's recent slip-ups– perceived or actual– will do little to dent the world's largest automaker's rep amongst American consumers. Just as it took Detroit decades to drag their reputation into the mire, Toyota would have to totally and repeatedly screw the pooch from now until at least 2017 to reverse their mindspace momentum. Meanwhile, over at the new look Detroit News, columnist Daniel Howes is already dancing on the ToMoCo's grave, and predicting Detroit's return to glory. "As Toyota falls, Detroit Big 3 rise" starts by listing the Japanese automaker's troubles: Consumer Reports reliability slippage, the defection of two top Toyota execs to Detroit and the sheen removal from the company's green credentials. Bottom line? "Toyota's stumbles show it is no more invincible than Detroit is congenitally incompetent." While you could argue that the key difference is that Toyota knows it isn't invincible while Detroit remains unwilling to acknowledge their incompetence (e.g. the "new" Ford Focus), I couldn't possibly comment. Anyway, Danny's faith in Detroit's renaissance comes down to one factor: brave new leaders. "There are more of them inside Detroit's automakers and atop the UAW than anytime in a long time." How great is that?

Agencie France-Presse (AFP) reports that Toyota is recalling 472k Japanese Domestic Market (JDM) vehicles for a faulty fuel systems. Although no related accidents or incidents have been reported to date, the defect could cause gas line leakages. All told, the company's recalling eight different JDM models, including the flagship Toyota Crown, which occupies the same slot in Toyota's JDM line-up as the Camry occupies in the good ol' USA. Arriving hot on the heels of Toyota's decline in Consumer Reports' reliability ratings, the news is sure to arm the pro-domestic crowd with more ammunition against the automotive world's new king of the hill. Interestingly, the recall includes models  manufactured from 1999 – 2004, when Toyota was thought to be the far-and-away leader in reliability and initial quality.

Nominations for TTAC's Ten Worst Automobiles awards continue apace. You, our not-so-gentle readers, are cordially invited to continue submitting your ruminations on these ruinations underneath this post. So far you've nominated 118 different vehicles (give or take a few clones). While we're not keeping track of how many nominations any given car receives, there are already a few clear front runners. Here's a roundup of the "leading" nominations and their pithy proponents…

CNN Money is reporting that Toyota has dropped from first to fifth place in Consumer Reports' (CR) ranking of average predicted reliability for all models sold under a given brand after one year of ownership. ToMoCo now slots beneath Honda, Acura, Scion and Subaru. What's worse, CR no longer recommends V6 Camrys or V8 Tundra full-size pickups due to their poor reliability. And the hits keep happening. CR says the results are so rad/bad they're changing their "free ride" methodology. Before now, Consumer Reports would assume at least average reliability for Toyota's new cars, without waiting for owner survey data. From now on, the magazine will wait for a full year of reliability survey data before recommending a Toyota product. As it does with most other manufacturers. As it should have from the git-go. Meanwhile, of the domestics, only Buick made it into CR's top ten, although Ford and Mercury are climbing CR's brand reliability charts (to 13th and 11th respectively). Of the 39 cars rated "most reliable," the domestics scored just four nods. Of the 44 "least reliable" models, The Big 2.8 accounted for 20. And the biggest loser is… the Solstice, with 234 percent less reliability than CR's statistical average. Pontiac's once red-hot roadster just beat the Cadillac Escalade EXT for the bottom position. CR reckons the 'Slade is 220 percent less reliable than average. That doesn't sound good.

[TTAC data provider truedelta analyzes CR's methodology here.] 

Last year about this time, we gazed into the crystal ball to predict a few changes in the automotive world. A lot of water's gone under the proverbial bridge since then: Toyota's world number one, the UAW's selling out their membership for a few dozen billion, Ford and Chrysler are attempting turnarounds with leaders who have no automotive industry experience whatsoever and GM Car Czar Bob Lutz is straining his personal credibility beyond breaking point. Well, OK, some things haven't changed. Anyway, with all that's happened in the past year, what does the future hold? Here are some of our predictions.

Hyundai Announces New Model:  Hyundai's Ford division has unveiled its latest offering: the midsized Torino II. Rejecting web reports that the "new" car is merely a rebadged next gen Sonata, Ford's Emperor of the Americas, Mark Fields, stated "The new Torino II resurrects a distinguished name from Ford's past in a bold move that brings an unprecedented level of sophistication to the Ford brand." 

The new model rounds out the Ford line, joining the subcompact Pinto II (built on the Accent platform), compact Maverick II (which shares drivetrain and other components with the Elantra), and the new F-150 II pickup (built on the Veracruz platform). Kia's Mercury division has yet to make any new model announcements. Rumors of a resurrected Lincoln Continental based on the Kia Amanti are unconfirmed.

GM Relocating to Follow Their Market:  In a surprise move late yesterday, GM announced plans to relocate the company headquarters to Mumbai, India. CEO-for-Life Rick Wagoner explains: "Since all of our assembly plants are in India, Thailand, Korea and China, it was only natural that we consolidate our operations in that region, too. This will allow us to get better control of expenses and begin the last phase of our turnaround plan."

GM plans to keep a small staff on floors three and four of the Renaissance Center to handle North American marketing, along with a warranty claims staff on floors five through 68. Nonagenarian Vice Chairman and Product Czar Robert Lutz was napping, and thus unavailable for comment on the move.

Gore Declares War on Environmental Hazard: Nobel prize winner, former Vice President and presidential also-ran Al Gore announced today he was beginning a campaign to limit the use of fuel cells in automobiles. Gore, who won his Nobel for inventing the internet and discovering greenhouse gases, stated that these so-called "zero emission" cars were, in fact, producing dangerous levels of dihydrogen monoxide (DMHO) and releasing it into the environment.

As he explained, once released, this compound collects in large clouds in the atmosphere which block the sun and increase the greenhouse effect.  It is found in acid rain and contributes to soil erosion. DMHO has become so pervasive it can be found in almost all foodstuffs and is even sprayed on "organic" produce, Gore warned. He has made eliminating DMHO from the environment his primary goal for this decade.

Business as Usual in the PRC:  Chery is being sued by Daimler for patent infringement. The suit centers around the rear suspension of the Cherysler 300. The suspension, originally designed by then-DaimlerChrysler, was based on the suspension of the Mercedes E-class. Since Chery's acquisition of the Chrysler division from Cerberus, Daimler claims they have done nothing to modify or redesign the suspension and in fact are expanding its usage to other vehicles.

Daimler legal counsel Max Schwanstüker, who filed the suit, asserted Chery has had plenty of time to redesign the suspension– but chose not to. Chery countered by stating they have indeed redesigned it; as it now includes parts from the latest E-class. The Chinese government has issued a statement saying there have been no patent infringements by domestic automakers, nor can there be.

UAW Seeks New Identity:  The United Autoworkers Union (UAW) is changing its name. Since their membership no longer includes any autoworkers, the UAW realizes they have to change with the times. In a press release, the UAW stated, "Unlike the Teamsters Union, which has nothing to do with horse teams, sports teams or any other kind of team, we want our name to remain relevant." Some of the names they're considering: Minimum Wage Workers Union (MWWU), United Service Industry Workers Union (USIWU) and Busboy, Waitress, Casino and Daycare Workers International (BWCDWI)

Motor Trend Modernizes Content:  Motor Trend (MT) disclosed plans to publish content consisting only of special advertising sections. MT publisher Beefy McBigmac justified his decision by saying, "Surveys show our readers don't know the difference between what we write and the advertisements, so why not save a few editorial bucks and let the advertising agencies write all of our copy? This way we can afford to keep giving away subscriptions while other automotive magazines are having to convert to on-line publishing." 

In an unrelated story, Motor Trend announced their Car of the Year is the all-new Hyundai Ford Torino II.

GM Death Watch Reaches Milestone: TTAC's GM Death Watch Series has reached a milestone. This week sees the publication of The Truth About Cars' GMDW 1,000. Publisher Robert Farago said, "That f-ing company has more f-ing lives than a f-ing alley cat. Just when you f-ing think it's going down for the third f-ing time, someone throws it a f-ing life preserver and it just keeps f-ing floating along, hanging on by its f-ing fingertips."  Farago is certain GM– which is now the world's sixth largest automaker after Toyota, Honda, Nissan, Hyundai, and Chery– can't last much longer.  "We're in it until the bitter end – either theirs or ours."

Does the average American consumer know or care that GM owns Saturn? Or Toyota Scion? Nope. TTAC has been arguing since ever that brands are the heart and soul of any and all car companies; it's how people perceive the products vying for their patronage. Automotive News [AN, sub] has run an analysis of U.S. car sales by brand for the first nine months of '07, and there's blood all over the carpet. A cataclysmic shift leaves Toyota the undisputed king of cars. "The Japanese juggernaut slashed the retail sales gap with GM by 40 percent during the first eight months of 2007… GM's retail advantage dropped from 487,235 vehicles for that period last year to 282,677 vehicles this year. If current trends continue, AN predicts ToMoCo will wrest the overall number one spot from GM within four years (by 2011). In fact, the Chevrolet Impala is the only domestic vehicle that appears in the nine-month top-10 automotive list, trailing the Toyota Camry by over 100k units. (Take fleet sales out of that equation…) Meanwhile, "Honda has quiely risen to number three in U.S. car sales, looking at achieving 10 percent of the U.S. light-vehicle market by year's end. Ford has tanked. The Blue Oval Boyz' overall sales are down 13.3 percent. They've lost sales every month this year and dropped nearly two points of market share. In the upmarket automotive arena, Lexus is set to topple Cadillac as America's favorite luxury brand, heading for '07 totals that will beat Cadillac's best ever sales year. 

Ford Model T. Volkswagen Type 1. Tata People's Car. Tata what? Next fall, Indian automaker Tata plans to introduce a $2,500 car to put India's masses on wheels, just as Ford and VW did in their home countries. The New York Times reports that Tata is one of several automakers who want a piece of the entry-level pie in what will soon be the world's fastest-growing car market. (Maruti Suzuki currently controls more than 50 percent of that market, with models as low as $5k.) As Tata moves even further down market, they're joined by Honda, VW (Skoda), Toyota, Renault-Nissan and Ford. While critics are worried about the safety of such cheap cars, the automakers all say they'll meet local safety standards (how reassuring is that?). Needless to say, environmentalists are expressing concerns that more cars on India's roads will exacerbate India's air pollution problem.  

Sorry, I get confused sometimes, what with all these domestic automaker-sponsored surveys that surprise! reveal that their products' quality is nearasdammit as good as their competitions'. Initially. In some cases. If you're comparing a lack of defects– as opposed to some other, more consumercentric measure of quality. Anyway, once again Ford paid RDA Group of Bloomfield Hills to survey 31k car buyers who'd lived with their new whip for all of 90 days. The Detroit News (DTN) dutifully reports that "2007 model year Ford, Lincoln and Mercury cars and trucks had 1,395 quality issues per 1,000 vehicles, compared with 1,381 per 1,000 vehicles for 2007 Toyota, Lexus and Scion cars and trucks." (Honda came first.) Just in case you suspect that shock! Ford's patronage might have influenced the outcome, the DTN assures us that "The firm conducts similar studies for other automakers [Ed. with similar results?]," and "its findings have hewed close to those of the closely watched annual initial quality survey independently conducted by J.D. Power and Associates." Bennie Fowler, Ford's quality chief, told the DTN that Ford's "trying to listen to its customers and take their concern to heart." As Yoda would say, "Do… or do not. There is no try."

This truth thing seems to be catching on. First, Ford buys thetruthabouttrucks.com. Then Audi capitalizes (literally) on TRUTH IN ENGINEERING. And now a coalition of nine environmental groups– the American Council for an Energy-Efficient Economy, the League of Conservation Voters, the National Environmental Trust, the Natural Resources Defense Council, the Union of Concerned Scientists, the U.S. Public Interest Research Group, Friends of the Earth, Conservation Law Foundation and Environment California– have launched TruthAboutToyota.com. The hate site takes Toyota to task for opposing the more aggressive of two congressional bills mandating hikes in federal Corporate Average Fuel Economy (CAFE) averages. The accompanying USA Today full-page ad and press release takes plenty of media-friendly bites out of ToMoCo's ass. "Just because Toyota is taking over General Motor's market share does not mean that Toyota has to take on GM's anti-environmental lobbying practices," pronounced Brendan Bell, Washington Representative for the Union of Concerned Scientists. "Toyota needs to start living up to its slogan, 'moving forward' instead of driving us backward," warned Philip Clapp, President of the National Environmental Trust. You can be sure Toyota's none-too-happy about playing truth or consequences with America's greens.

The Detroit News' Daniel Howes reports that FoMoCo is following Chrysler's lead, hoping top Toyota talent can right their sinking ship. James D. Farley, group vice president of Toyota Motor Co.'s Lexus Division, is set to join The Blue Oval Boyz as their first head of global marketing and communications. Howes sings hosannas to Farley's new boss Alan Mulally, sees no downside to the deal and singularly fails to mention the astronomical pay packet involved. "That a rising Toyota star, the head of Lexus and a founder of its Scion youth brand would bolt the Japanese juggernaut for the struggling Blue Oval is a testament to Mulally's leadership, the strength of Ford's current lineup, the promise of its future products and the upside in it all." And once again we feel compelled to point out that Farley, like Chrysler's Jim Press, is the product of a consensus management system, rather than its originator. In other words, one wonders how he fares in the ass-kicking department. Watch this space, and all of Ford's advertising.

It’s true. The United Auto Workers (UAW) six hour strike against Chrysler was nothing more than a bit of empty posturing, some meaningless moaning and a quick and unsatisfying climax. Oh I’m sure the union bosses are basking in the warm afterglow of successful pattern bargaining; safe in the knowledge that Chrysler will render unto Caesar the same plunderiffic health care deal as GM, as they look fordward to their next payout. And Chrysler’s new masters must also be happy with the deal. (Ipso facto.) But anyone who’d hoped that someone in Detroit would have the balls to finally shaft the UAW has been left high and dry.

Truth be told, I was one of those observers who assumed that a switch from public stockholder to private equity ownership would help Chrysler grow a serious set of stones. With no one to answer to but their free-spending wives, ex-wives and children, with pockets deeper than an Icelandic ice core, Cerberus' directors could do what The Big 2.8’s erstwhile guardians had never done (if the thought even occurred to them): walk. Hey Ron! You want job guarantees and a bazillion dollar health care VEBA? See you in China. Anyone want to buy Jeep?

That said, my belief in Cerberus’ ability to upset the union applecart disappeared long before the UAW negotiations began. A few weeks after Chrysler’s overlords installed former Home Depot CEO Bob Nardelli into the top slot, I suspected Cerberus couldn’t get wood. There was only one good reason to hire the Prowler-owning auto industry virgin, a man whose largest contribution to his previous employer was self-checkout terminals (for which he paid himself $210m). To cull the deadwood and strip Chrysler like the Grinch looting Cindy Lou Who’s house.

This he didn’t do. If anything, Nardelli’s added complexity to the system. First, he failed to fire Chrysler Prez Tom LaSorda; the exec that helped the Germans run the ailing American automaker into the ground. Next, Nardelli appointed his office manager as his new turnaround titan. Then he hired Toyota’s Jim Press as Chrysler's car czar; a self-professed "servant leader” whose consensus management style poses no threat to Chrysler’s dysfunctional bureaucracy. These are not the actions of a revolutionary intent on a destroying a busted business model.

I know: it’s hard to believe that Cerberus would allow Chrysler’s new management team to adopt the same “steady as she goes” strategy that’s helped GM shed huge chunks of market share and drop billions over the last 17 years, and led Ford to mortgage everything up to and including their logo. With bankruptcy’s long shadow hanging over Detroit, how could anyone with even the gentlest grasp on recent history assume that tweaking overheads, products, sales and marketing is a recipe for success?

And yet, where’s the game changer? 

The weird thing is that Chrysler seems to know what it should be doing to reinvent itself. They made a head fake in the direction of cleaning their dealers’ clocks, looking to trim a bloated dealer network Chrysler can’t afford. And then they backed off. They talked about killing overlapping, brand-defiling models and refocusing their product line. And then added more complexity: a new hybrid-building hothouse. AND we're still waiting for the Pacifica, Durango, Aspen, et. al. to die. Chrysler hinted that a GM-style union health care VEBA superfund wasn’t for them. And then they agreed to it.

Perhaps the UAW agreement is simply Cerberus’ attempt to buy some time. Let’s get the best union deal we can, keep the dealers’ doors open and the factories humming a while, and THEN we’ll blindside them. THEN we’ll close factories, kill models, import Chinese products, cut deals with other automakers to retail their products, sell off brands, face the dealers in court, etc. It’s a heartening thought for those who see Chrysler’s re-invention as the key to its survival, but the facts don’t fit the theory.

Cerberus’ is famous for implementing a “100 day” plan on their new acquisitions. The 100 days have come and gone; if they were going to kick out the jams, the jams would be kicked. Aside from adding new management, the carmaker Cerberus owns today looks strikingly similar to the carmaker Cerberus purchased on May 14– new union contract and all. 

In fact, the day before the UAW strikelet, Chrysler announced they were cutting 415 full-time white collar jobs from their Auburn Hills HQ, and saying sayonara to 1000 temps. The bloodletting was part of LaSorda’s pre-Cerberus turnaround plan, which dictated that the automaker shed 11k hourly and 2k salaried jobs over three years. So the “old” turnaround plan was/is still chugging away behind the scenes, even as Cerberus headed into and out of UAW negotiations. That ain’t good.

It’s time to face facts: Chrysler’s new boss is the same as the old boss. Same game plan. Same results. The UAW non-strike strike proves that the real indecencies are yet to come.

The American automotive market offers just three inline six (I6) engines. First and foremost: BMW's 3.0-liter unit. Devotees will find the propeller people's sublime I6 in the 328i and 528i, and in turbocharged form, in the 335i and 535i. Otherwise, there's GM's excellent 4.2-liter I6 found in the Trailblazer, Envoy and Saablazer 9-7x. And don’t forget Volvo’s new 3.2 and 3.0L I6 engines, used in the 2008 V70/XC70/S80/XC90 and the baby Land Rover. These sweet, smooth, silky engines are all that's left of a once-proud breed. The GM engine will probably die along with its host SUV in a few years, just as Jeep dropped its 4.0-liter inline six with the passing of the Wrangler. Mercedes ditched its straight six over a decade ago. Jaguar used to sell a six cylinder inline engine in the classical XJ6. And of course there were three outrageous examples from Toyota: the 4.5-liter straight six in the Land Cruiser and two different 3.0- liter six pots holstered by the Cressida, Supra, Lexus SC300 and IS300. Why has the I6 gone by the wayside? Lots of reasons. A V6 is a lot more compact, and most manufacturers use engines across their entire brand lineups. That means a modern V6 engine has to fit both transverse and longitudinal applications; Nissan, Toyota, GM, VW/Audi twist their V6s by 90 degrees. Hopefully the future will hold more I6 engines, if only because they tend to be so full of character, well balanced and smooth. Until then, you can pick up your own straight six on the cheap in a used Suzuki Verona (which even mounted it transversely).

[Click here for the technical differences between I6 and V6 engines]

September wasn't kind to the auto industry. Total U.S. light vehicle sales ended the month 2.9 percent below September 2006. The year-to-date (YTD) news wasn't very encouraging either; sales for the first nine months of 2007 are 2.8 percent below the same time last year. Of The Big 2.8, only GM finished the month (barely) in the black. Ford, Chrysler, and Toyota all posted declines compared with last September. Looking at our four-wheeled sampler, separating the winners from the losers is a matter of seeing who lost less. 

Passenger Cars

The bad news: Chevy's Impala dropped about 1800 sales from August. The good news: the sales stalwart's up six percent compared to September last year; up 13.9 percent YTD. Chrysler's once-mighty 300 ain't so mighty no mo'. September sales dropped 13.2 percent, while annual sales fell 14.9 percent. Fusion sales offered Ford a glimmer of hope, rising 9.6 percent for the month, racking-up a 1.3 percent gain for the year. Toyota's killer Camry continues its sales growth, up 5.7 percent on the month and 7.1 percent for the year.

Pickup Trucks

Rebates reigned supreme. Despite slapping more cash on the hood and even more generous financing incentives, Chevy Silverado sales rose just one percent for the month. YTD, sales are down 1.9 percent. Dodge is also throwing cash at Ram buyers, which helped jack-up sales by 20 percent. Annual sales are up just 0.6, but it's still a victory (of sorts). Smaller cash rebates and not-quite-so-cut-rate financing aren't helping Ford's F-Series; sales were off a whopping 20.8 percent, running 12.9 percent total behind last year. Toyota revived its incentive campaigns on the Tundra, sending the texas-built pickup on its way to meeting its first-year sales goal of 200k units. Tundra sales rose 55.2 percent for the month and 57.9 percent YTD.

Truck-Based SUVs

Although Chevy's Tahoe sales for the month leaped by an amazing 52.2 percent (fleets?), YTD sales slipped 9.2 percent. Dodge's Durango's sales are MIA, sinking a titanic 49.6 percent; it'down 29.8 percent YTD. The Ford Explorer was almost as lost, dropping 31.9 percent, losing 24.2 percent YTD. Toyota's not immune to the SUV exodus: 4Runner sales sank 2.7 percent, down 16.8 percent YTD.

CUVs
 
After a brief rally in August, Chevy's Equinox dropped almost 5k units in September. It's down 4.1 percent for the month, and 21.1 percent for the year. The Pacifica is all at sea. September sales of Chrysler's hoary CUV are down a staggering 43.8 percent, and 29.6 percent below the first nine months of 2006. Ford's Escape helped The Blue Oval Boyz escape bankruptcy for another month. Escape sales rose 10.3 percent  on the month and up 3.8 percent on the year. Toyota redesigned RAV-4 rocks. Sales increased 24.8 percent, 14.1 percent YTD.

New Models

Overall, GM's Lambda triplets (Acadia, Enclave, Outlook) racked-up over 12k sales in September. GMC's Acadia, up 800 units from August, continues to be the most popular of GM's Lambda CUVs. The Ford Edge continues edging-up from its drastic drop in July, with an increase of 1500 sales over August. Jeep's Compass wasn't so fortunate. It dropped 800 sales from August.

Total Sales
 
Although September sales fell below August's peak, GM finished the month 0.3 percent above the previous year. They're still below 2006 for the YTD, with a 6.6 percent drop. Chrysler and Ford both ended the month 5.4 and 20.4 percent respectively below September 2006. Chrysler is down three percent YTD and Ford is 13.3 percent lower YTD. Toyota finished below 2006 for the second month in a row, this time with a 4.4 percent deficit. However, YTD, they show a 3.8 percent increase.

The Future

As the 2007 model year winds down– with the usual clearance sales and the '08 models flooding into the showrooms– GM begins the new year with a new UAW contract. Under the new agreement, they're sure to force encourage a lot of their experienced workers to retire, resulting in a large labor turnover. What impact these changes will have on production, prices or quality remains to be seen. All three domestic automakers are saying the new union contracts will give them parity with Toyota and the other transplants. How quickly this will translate into better designs and an improved product– if at all– anyone's guess. 

I don't pretend to understand all the ins and outs of Lithium-Ion battery technology. I know the basics: they're smaller than the nickel metal hydride cells (as used by the Prius' Synergy Drive), potentially more efficient, catch fire from time to time and, when they do, they're more difficult to put out than my schnauser in a snowstorm. Battery maker EnerDel (owned by Ener1) is set to unveil the fruits of their Li-Ion labors tomorrow. Company Vice Chairman says they've nailed it; their 60 engineers and technicians have developed a hugely efficient, cool-running Li-Ion battery for automotive applications. In a telephone interview with TTAC [below], Charles Gassenheimer revealed some of the technical specs, discussed the company's safety tests and pointed-out that their patented technology is not [yet] applicable to plug-in hybrids or electric vehicles. And what of Toyota's Li-Ion work with Panasonic? Ironically enough, Gassenheimer says his competitor's efforts were recently dealt a blow by… a fire in their factory. [NB: EnerDel officials will be monitoring comments to answer your questions.]

The Canadian dollar is back. After a thirty-year slump, the “loonie” is now staring eye-to-eye at the American greenback. The strong Canadian economy, the worldwide thirst for oil, and George Bush using The Fed as a money tree have all converged to push the Canadian dollar skyward. The meteoric rise of the dollar has given Canadians incredible arbitrage opportunities with American products; especially cars. The Canadian car industry ain’t pleased– and for good reason.

In 2006, Canadians imported 112k new and used vehicles from their neighbors to the south. That stat represents over 50 percent growth in US imports over the last two years. The crux of the problem: many retail prices in Canada are based on an exchange rate more appropriate for the Clinton era. To wit: Buying a Nissan 350Z Coupé in the United States will cost you $29,000. A similarly optioned car in Canada will cost – wait for this – $51,000.

Now, converting the US price of $29k at a rate of about 1.06 yields $30,740. Throw in $2k for shipping (you can drive it up yourself on a temp plate), $1800 in import duties (which you don’t pay on any vehicle assembled in the NAFTA zone), $5,200 in taxes (assuming Quebec and Ontario’s rates) and you’ve pocketed a cool CA$13k by buying your new Z stateside.

The downside, of course, is that Nissan, like most manufacturers, doesn’t honor warranties in any country other than the country of purchase. One notable exception (of course): Toyota. The Japanese automaker honors warranties all across North America. It’s good for the whole family, too: Lexus, Scion, Toyota and the newest addition, Subaru, are all included. Still, if you’re not expecting 13 grand’s worth of warranty repairs on a reliable car like the 350Z, the deal is hotter than a dancing bobcat with its ass on fire.

The other problem is red tape. In order to get a US-spec vehicle on the road in Canada, it must first be admissible for import. The government has printed a list of such vehicles on http://www.riv.ca. Conspicuous by their inadmissibility are the Pontiac GTO and the Mistubishi Lancer Evolution IX, which have failed Canadian bumper and emissions tests. Export papers need to be filed at U.S. customs, and import papers at Canadian customs, including a manufacturer’s letter stating that no outstanding recalls apply to the vehicle in question.

Once imported, a vehicle has to be converted to display kilometer-based readings, and have daytime running lights installed. Finally, the vehicle must be inspected and (possibly) emissions tested before it can be registered in a province of Canada. Other annoyances may apply. For example, if the vehicle comes from a state with lax tint and modification laws, you might end up needing to make cosmetic adjustments as well.

The fact that new cars start so much lower on the MRSP ladder in the U.S. also has ramifications in the used market. A 2005 Honda Accord EX-L with 14k miles will fetch about US$18k stateside. The same car will cost $23,400 in Canada. Converting 18-grand to Canadian and applying taxes will give us a car that costs $21,050. The best part? Since the Accord is assembled in Ohio, it’s a NAFTA car! On savings of $2,350, the day trip to upstate New York pays for itself. Even greater savings can be had on big-time depreciators like the Cadillac CTS-V or the Porsche 911 Turbo.

I picked the 350Z scenario because it’s a more extreme example of manufacturers being too greedily lethargic to adjust their Canadian pricing. Driving.ca recently quoted an average difference to be about $5,800 across international lines in one of its articles. The difference is still important enough to encourage a steady, increasingly large parade of vehicles across the border.

The government of Canada is hemming and hawing about ways to protect Canadian dealers while in some ways paying lip service to NAFTA. For their part,  manufacturers are now threatening U.S. dealers with a loss of franchise if they continue selling to Canadians. Meanwhile, the market is busy reacting predictably. For those too lazy to go through all the hoops, vast arrays of brokers and importers have put out a shingle and are waiting for your business.

Eventually, something will break. Either the manufacturers will adjust Canadian pricing, outright ban the sale of cars in the United States to non-residents or the Canadian government will impose an automotive tariff.

The medium-term outlook for the U.S. dollar is particularly bearish. Therefore, there is no reason to expect an abatement of any kind in Canadian imports. It’s a strange role reversal for many Americans, to think their country has become Canada’s automotive outlet mall. Quite soon, Canadians will be making fun of that “funny, two-tone money,” too.