After securing a fantastic deal on my recent car purchase through direct negotiation, I encountered a flyer for the Costco car buying program during a routine shopping trip. This service, leveraging Costco’s partnerships with dealerships, promotes attractive pricing and a streamlined buying experience. Intrigued about the real value of this program, particularly its pricing competitiveness, I reached out to my car dealer to gain some insights.
Initially hesitant, my persistence paid off, and the dealer provided some revealing information regarding Costco’s car buying program in 2016. My key question was direct: would using the Costco car buying program for my recent car purchase have resulted in a better, worse, or equivalent price compared to what I achieved through independent negotiation?
The dealer’s response was clear: “The Forester you just bought would have been more [with Costco pricing]. Remember we waived the dealer handling. With Costco’s car pricing you will pay the dealer handling.” At this dealership, the dealer handling fee was $389. This meant my negotiated price was theoretically $389 lower than the Costco program price, reinforcing the excellent deal I had secured through my own efforts. This advantage was further amplified by my bidding process, which likely drove the price down beyond initial offers.
To clarify further, I inquired whether the dealer handling fee was the sole difference or if the base price offered through Costco was also different. My curiosity stemmed from Costco’s reputation for great deals, and I wanted to understand the substance behind this claim.
The dealer explained, “Costco pricing is set by the dealers. They cannot sell a vehicle to you, they are not licensed to. They will send your information to the dealer and we send you the pricing. The price we give you is net, net, net. This is the price we pay for the Forester. The Costco price would have been the same other than that. That was the price I gave you on the Forester before we took off dealer handling.”
This confirmed that the Costco car buying program in 2016 offered prices close to the dealer’s cost, before handling fees. While the Costco program presents a very good price point, direct negotiation, especially employing a competitive bidding strategy, can still potentially unlock even greater savings. It’s worth noting that dealers may have some flexibility in setting Costco prices, so individual experiences might vary. However, based on this 2016 comparison, the Costco car buying program is a strong option, but informed buyers might still find avenues for better deals through direct negotiation.
