Costco is renowned for bulk groceries and unbeatable deals, but did you know their member benefits extend to car buying? The Costco Auto Program has been connecting members with discounted new and certified pre-owned vehicles since 1989, aiming to simplify the often stressful car buying process. If you’re looking to avoid haggling and potentially save money, the Costco car program might seem appealing. But Is The Costco Car Program Worth It for you?
This comprehensive review will delve into the Costco Auto Program, exploring its pros and cons, how it works, and whether the exclusive member discounts truly translate into significant savings and a better car buying experience. We’ll help you decide if leveraging your Costco membership for your next vehicle purchase is a smart move.
Understanding the Costco Auto Program: How It Works
It’s important to clarify upfront: you don’t buy a car directly from Costco. Instead, the Costco Auto Program acts as a facilitator, connecting Costco members with a network of over 3,000 participating dealerships across the United States and Puerto Rico. These dealerships offer pre-negotiated pricing and exclusive incentives to Costco members.
Think of it as a curated car buying network. Costco partners with select dealerships known for high customer service scores. This partnership provides access to new and certified pre-owned vehicles, and also facilitates trade-ins, leases, and even RV purchases. The program aims to offer a less stressful, more transparent car buying experience.
A Costco member reviews pre-arranged pricing documents with a dealer contact, experiencing a streamlined car buying process.
Step-by-Step: Buying a Car Through Costco
To access Costco member-only deals, you can’t simply walk into any dealership. Here’s a breakdown of the process:
1. Begin Your Search Online
Start at the Costco Auto Program website. Enter your ZIP code and specify whether you’re interested in a “New” or “Pre-Owned” vehicle. You can then refine your search by model, year, make, and trim level. The website also provides helpful tools for vehicle research and comparison.
For pre-owned vehicles, the process is slightly different. You’ll browse inventories at participating dealerships in your vicinity, rather than selecting a specific vehicle upfront.
Once you’ve identified a vehicle of interest, you’ll be prompted to provide your name, contact details, and Costco membership number.
2. Connect with a Participating Dealership
After selecting your desired vehicle, the website will present a list of approved dealerships with the car in stock. Choose a dealership from this list and contact them to schedule an appointment.
3. Visit the Dealership and Discover Your Member Price
At the dealership, you’ll be assisted by a Costco Authorized Dealer Contact (a dealer representative specifically trained and authorized to work with Costco members). They will present you with your Costco Member-Only Price Sheet, outlining the prearranged price negotiated through the Costco Auto Program.
Remember, viewing the Costco price doesn’t obligate you to buy. This step is essential to unlock the exclusive pricing and determine if the deal is right for you.
Financing Your Purchase
Even with Costco’s prearranged pricing, securing financing is a separate step, unless you plan to pay cash. Consider exploring your financing options beforehand. Online marketplaces like LendingTree’s auto loan marketplace can help you compare offers from multiple lenders, allowing you to find the best rates without impacting your credit score.
Comparing auto loan offers online to secure financing for a car purchased through the Costco Auto Program.
Is the Costco Car Program Worth It? Weighing the Pros and Cons
The question remains: is the Costco car program worth it? It offers potential advantages, but it’s not a perfect solution for everyone. Let’s examine the pros and cons to help you decide.
Pros of the Costco Auto Program
- Simplified, Streamlined Experience: The Costco program aims to simplify car buying. The prearranged pricing means less time spent negotiating, potentially speeding up the dealership visit.
- Helpful Online Research Tools: Costco’s Auto Program website offers tools to compare vehicles, read reviews, and use a car finance calculator, aiding in your research process.
- Enhanced Customer Service Standards: Participating dealerships and their Authorized Dealer Contacts are expected to uphold Costco’s renowned customer service standards. Costco even utilizes secret shoppers to ensure these standards are met.
- Exclusive Member Deals and Incentives: Costco advertises limited-time specials and manufacturer incentives for specific makes and models, in addition to pre-negotiated pricing. While exact savings aren’t publicly disclosed, members often report favorable deals.
- Post-Purchase Discounts: The benefits extend beyond the car purchase. Costco members can also receive discounts of up to 15% on car parts, service, and accessories at participating service centers.
A Costco membership card, essential for accessing the Costco Auto Program and its member-exclusive benefits.
Cons of the Costco Auto Program
- Costco Membership Requirement: You must be a Costco member to use the program. A Gold Star membership costs $60 annually, and an Executive membership is $120. Consider this cost when evaluating potential savings.
- No Upfront Price Transparency: You won’t see the Costco price online. You must visit a dealership to view the Member-Only Price Sheet. This lack of upfront transparency can be inconvenient if you are comparing multiple makes or models at different dealerships.
- Limited Dealer Network: Not all dealerships participate in the Costco Auto Program. While there are 3,000 participating dealerships, your preferred local dealer might not be included. Furthermore, you need to work with a certified Authorized Dealer Contact within the participating dealership, which may require waiting.
- Vehicle Limitations: The program doesn’t guarantee availability for every make, model, and trim level. Vehicle availability depends on participating dealership inventory and factory ordering capabilities. Niche or less common vehicles may be harder to find through the program.
- Potential for Upselling and Add-ons: While the vehicle price is prearranged, dealerships may still try to sell you add-ons like extended warranties or appearance packages. You might still need to negotiate to remove unwanted extras from your final bill. This means the “no-haggle” benefit isn’t entirely absolute.
Alternatives to the Costco Auto Program
If you’re still unsure if the Costco Auto Program is the best route for you, consider these alternatives:
- Traditional Negotiation: If you enjoy negotiating or are confident in your haggling skills, you might secure a comparable or even better deal by negotiating directly with dealerships yourself. This also gives you the freedom to work with any dealership, not just those in the Costco network.
- Car Brokers: Car brokers act as your personal car buying agent. They negotiate on your behalf and can find deals, but they charge a fee for their services. Weigh the broker’s fee against potential savings.
- Competitor Car Buying Programs: TrueCar is a well-known alternative, offering a free service for everyone to compare dealership pricing. AAA also provides a car buying program similar to Costco’s for its members, and Navy Federal Credit Union offers a members-only program through a TrueCar partnership.
Final Verdict: Is the Costco Car Program Worth It?
So, is the Costco car program worth it? The answer depends on your individual needs and preferences.
The Costco Auto Program is likely worth it if:
- You are already a Costco member or plan to become one for its other benefits.
- You dislike haggling and prefer a more straightforward, transparent car buying process.
- You value enhanced customer service and appreciate the Costco brand reputation.
- You are looking for a popular make and model readily available through participating dealerships.
- You are comfortable with potentially visiting a dealership to unlock pricing information.
The Costco Auto Program might not be worth it if:
- You are not a Costco member and are solely considering membership for car buying.
- You enjoy negotiating and believe you can get a better deal independently.
- You are looking for a very specific or less common vehicle that might not be readily available through the program.
- Upfront price transparency is a top priority for you.
Ultimately, the Costco Auto Program provides a valuable service for many car buyers. By understanding its process, weighing the pros and cons, and considering your own car buying style, you can make an informed decision about whether to leverage your Costco membership for your next vehicle purchase.
