Costco already sells all sorts of items you wouldn't normally find at your nearby neighborhood store. From caviar to wedding dresses to vacation planning, it seems that members have everything available to them. This includes car selling and buying.
Launched in 1989, Costco Auto Program is “an exclusive type of benefit for Costco members,” says Executive Vice President Rick Borg. (A Costco membership costs $60 per year for a “Gold Star” membership, or $120 for the “Gold Star Executive” level.) And the site, where most car orders are made, “is very robust with regards to research, pictures and safety reviews.” But it’s also everything a human averse to in-person negotiation could possibly want, which makes it so darn enticing.
“They’ve done a lot of legwork for you, and they’re giving you a guaranteed discount,” says Brian Moody, Executive Editor for Autotrader, an online marketplace for car sellers and buyers. Costco sets the price with dealers beforehand so shoppers don’t have to, eliminating what is perhaps the top sticking point about car buying from the process.
However, the program isn’t for everyone, as Moody points out. Read on for the pros, cons, and what you should expect when car shopping on Costco.
New car sales may be lagging this summer, but that hasn’t stopped automakers from upping the price of their vehicles. As Kelly Blue Book reported earlier this summer, average new-car prices rose three percent year-over-year, with demand for trucks and SUVs driving the uptick.
Still, a new car is one of the most important purchases you’ll make, and at an average of nearly $30,000, according to Kelly Blue Book, it doesn’t come cheap. No wonder Costco’s member pricing — which the company claims will shave $1,100 to $1,200 off the average transaction price in a local market — is so intriguing.
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