Yes Costco! Maybe you’ve seen cars parked near the entrance at your last Costco visit and wondered how the Costco auto buying process worked, and if it really was a better deal. My family purchased a car through their program, and I can attest that it was easy, and we got a great price with no hassle. It’s the way car buying should be.
The tale of two car-buying experiences
Several years ago my family was in the market for a new car. After doing research on Costco’s website, we decided that a Chevrolet Suburban was the right fit. We called our local dealer and asked if they had Costco pricing, they told us yes, so we started the car buying process.
The experience with our local auto dealership was horrible, and it turned out that they weren’t really Costco-authorized. All of the sleazy tactics that you hear about were deployed against us; including bait and switch, the hard sell on a model on the lot in a funky color, and changing numbers on options and our trade in that didn’t ever really add up. We finally told the salesman that we needed to think about it, and left frustrated and exhausted.
The sales manager called us the next day and the harassment continued. He had a “rock bottom price,” and when we asked him to fax the agreement over to us he got angry. The whole ordeal left me feeling so icky inside that I knew I’d never bring my car back for service. And what if there was a problem with the car, would this dealership stand behind us? Buying a car is a significant purchase. We had been looking for a partner, but what we fond was an adversary.
Our experience was so contrary to the great customer service we had always had from Costco, that we went back to the Costco web site and contacted customer service. They connected us with an actual Costco-approved dealership and scheduled a meeting, hoping things would be different this time.
Save yourself some time and learn from our mistake – start by clicking on the “Locate a Dealer” button at http://costcoauto.com to make sure that you are working with a Costco Auto representative from the beginning.
Costco is how car buying SHOULD be
At the Costco-approved dealership, we met with their Costco-trained sales person, our membership was verified, and we went on a test drive. We were given a base price and list of options with actual prices and built our Chevrolet Suburban. No hassles, the prices were right there in black and white. That dealership didn’t have the exact car that we wanted on their lot, so they found it in another dealer’s inventory. We agreed to a small mileage charge that was clearly identified. The resulting price was thousands lower than the “rock bottom price” that the other dealer had offered us, and we actually felt good about the relationship.
But the story doesn’t end there. The salesman took us to the service center and introduced us to the service manager. He spoke to me directly, asked me about the kind of driving that I do and explained the best way to use the options that we had selected on our new Suburban, including the towing package, 4 wheel drive modes and the best kinds of gas to fill up with. We were then introduced to the parts manager and offered a discount on parts.
Two days later, our Suburban had arrived and was detailed for us. We took it for a test drive, then finalized the deal. I drove home with a smile; I loved my new car and the process actually felt good! I was confident that we had truly found a partner in our car purchase and service relationship.
Does Costco’s program still work the same way? It’s actually better now.
I wanted to make sure that my experience was typical and interviewed Rick Borg, vice president of program operations for the Costco Auto Program. I told him my story and he said that was how the program was supposed to work.
“It’s all about value for the Costco member,” said Rick Borg, “The purchase price and process have equal emphasis in our model. We are always fine-tuning our program to continually improve it for our members.”
Here are some points of interest that I learned in my conversation with Rick:
- Most makes and models are available. There may be instances when a new car is introduced and in short supply, that vehicle may be excluded or there may be a waiting list.
- Costco makes every attempt to provide “Best in Market” pricing, members save on average $1,000 over typical average transaction price. That number varies by model; you will most likely save more on a higher priced car, probably less on a value-priced car. The competition is continually shopped to fine tune pricing.
- Costco Auto is available at all 448 warehouses, there is one dealer for each car manufacturer assigned to a warehouse. These dealerships are chosen carefully by their dealer ratings, ability to deliver, proximity to warehouse, and comparative pricing.
- The process is always under review for improvement. Costco has mystery shoppers that go through the complete process to ensure best practices. Their member advocacy group follows up with all who contact a dealer through the website or by phone to make sure that the member was taken care of to Costco’s standards.
- Factory rebates and financing are available on Costco-program purchases. Costco does not provide financing.
- If a dealership does not have the exact car that you want, you can factory order it, or the dealership can request a trade.
- Costco provides extensive, ongoing training for specific people at the dealership. Make sure that you are working with the Costco specialist.
- Leases and factory-certified pre-owned vehicles are available through Costco as well.
One more thing that I learned from Rick is that Costco members can also save on service, parts and accessories in the same transparent way – on any car, no matter where it was purchased. Like the car-buying process, the member initiates a contact through the website and is connected with an authorized Costco service department. If that experience is anything like our car buying experience, it’s a huge value with a trusted provider. Something all moms can appreciate.