A Gray Market in Luxury Cars

Americans used to buy expensive cars at bargain prices in Europe and then ship them back to the U.S. But that practice declined in the late 1970s, when the slumping dollar drove up the price of a Mercedes-Benz, Porsche or BMW. The dollar is back, and so are the car importers.

This year as many as 50,000 automobiles will be brought into the U.S. privately, a twelvefold increase in three years. Herbert Singer, a Munich car dealer, claims that half his sales are exported to the U.S. Says he: "I could sell five cars a day to Americans if I had the right color." The savings can be big, even after the $8,000 or so is paid to ship a car from West Germany and adapt it to U.S. safety and emission standards. Example: a Mercedes 500 SEL, when bought from an authorized dealer in the U.S., is about $52,000. The same model bought in West Germany and imported by a U.S. buyer goes for some $40,000 after the extra charges. American auto dealers sometimes refuse to service a modified car or take one in trade. But as long as that huge price difference exists, the freelance importers will continue buying abroad.