Car Buying Tips

Should You Buy A Car Through Costco? Is It Worth It?

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Last Updated on January 30, 2023 by Rose Morah

Is buying a car through Costco Auto Program worth it?

Is it worth your time and money?

Well, this article will help you figure it out through the experiences of other buyers who have used the auto program before when purchasing a car.

At the end of this article, you will have a better understanding of:

  • Buying a car from a dealership vs Costco Auto Program
  • The pros and cons of buying a car through the auto program
  • Is it cheaper to buy a car through the program? 
We have used the program a few times before. So, this article is mainly meant to create awareness, especially when it comes to making a big purchase such as buying a car.

Therefore, we are not promoting the Auto Program nor have we been paid for the information provided in the article!

Cons of buying a car through the Costco Auto Program

  1. Not all dealers are participating in the auto program

Depending on your location, you may find that there are not so many dealers participating in the program.

The closest dealership that is on the program may be at least 2 to 3 hours away.

In fact, in the past year (2022) there have been limited inventories. The market for cars has been insane due to the global supply issues that have affected the auto industry.

This explains why some dealers may have opted not to participate in the program or other discount plans, and why others have dropped out of the auto programs.

Additionally, some buyers have been on the wait list for 6+ months! 

We were not able to find a dealership participating in the Costco Auto Program that was within 200 miles unlike in the previous years.

Additionally, those that we found on the program were charging over the MSRP and had a really long waitlist.

However, this is not a Costco problem. The global supply issue is actually the reason why most dealers prefer not to participate in the program.

  1. Most participating dealers do not include popular cars (hot-selling cars) in the program

We discovered that if you are looking to buy popular / hot-selling cars through the Costco Auto Program, then it might be hard to find one. 

We were looking to buy a specific plug-in hybrid early in 2022 and Costco was not offering it in their auto program. We tried with no luck.

Others have also had similar experiences.
  1. Some dealers will not honor the Costco negotiating price

Most buyers who have gone through the Costco Auto Program have experienced dealerships that charge you more than the Costco price, especially since 2021.

Some people also believe that the dealers may be using the program to lure buyers in, then add in lots of other extras to make more money.

For instance, you will find a good deal via the auto program that is $500 off MSRP. 

But the dealer ends up giving you a final price that is more than what you had expected because of the add-ons and dealership fees. This may go up even to about $1500.

Only for you to later find out that all the other extras such as warranty are not part of the Costco deal.

This means that even if you were to contact Costco they can’t hold the dealer accountable.

Our best recommendations:

  • To save you time, be sure to contact the dealership to find out their out-the-door price (OTD) before going there.

This will help you know what you expect to pay when it comes to tax, dealership fees, DMV fees, and so on before setting foot in the dealership.

Note: Most of these fees will depend on your location/state.

For example, some can charge you less than $1000 in dealership fees. In other states, you can be charged more than $1000.

Additionally, if you are not interested in any add-ons, ask them not to include them in the price, that is if they haven’t been done already. 

  • Before going to the dealership, contact them to find out if they honor the Costco price

When buying a car through the Costco Auto Program, we contacted the dealership and they told us that they couldn’t honor the Costco prices during that period because of the chip shortages.

  • Always know the fairest price of the car you are looking to buy and which dealers are willing to sell you at that price
  1. Some dealers ignore the Costco program buyers.

Based on our research, some dealers ignore buyers from the Costco program.

For example:
I know of a guy who went through the program to buy a specific car, and in less than a few minutes he received an email that it was sold out.

However, when he called the dealership to find out when they will have one coming in, they said they have it on the lot.

Additionally, other dealers will not even bother to reply if you are buying through the Costco Auto Program.

  1. The Costco auto deals vary based on your location and the car

If you are looking to save more by buying through the Costco Auto Program, your location will affect how much you end up saving.

For example, you might not save much if you live in an area with a high cost of living compared to those living in a more rural area.

However, on the bright side, you get multiple offers from dealers in different locations if you are looking to get a good deal, and are not afraid to travel.

But, if you don’t mind the amount being charged for the car and want convenience, then you can buy through your local dealer.

Additionally, some cars will have great discounts and others very little. For example, you can’t expect to get a good discount on the hot selling cars.

See also:

Don’t Buy A Toyota Extended Warranty Before Reading This (Is It Worth It?)

Is the Ford Bronco Reliable? (Is it worth the cost?).

The Best and Worst Years For Toyota 4Runner (Buyers Guide & Experts Tips).

Pros of buying a car through the Costco Auto Program

  1. You might end up getting a cheaper price than you had planned for through the program.

For example, before the pandemic hit, we made excellent savings buying through the Costco Auto Program where we got $5000 off the MSRP.

Many other buyers who bought cars through the program have also gotten good deals that are below the MSRP. However, this was before the pandemic and is not guaranteed, especially during this time when the car market has gone insane.

  1. They have really good offers

At times Costco offers some price reductions on specific cars when you buy through their auto program.

The reduction can be as much as $1500 or even more for a specific car. So, you may end up getting a reduction off the negotiated price. 

  1. You end up getting the best price without having to deal with a salesman

For me, not having to deal with a salesman when you are at the dealership means less haggling and easy car purchase.  

  1. You can get multiple deals from different dealers through the auto program

If you are looking to get a better deal you can widen your search to get multiple offers from different dealers participating in the program.

  1. It may save you from overpaying when buying your car directly from dealers

According to CNBC, car dealers are making huge profits from high sticker prices that are over MSRP.

See also:

Best Tires For Electric Cars (Regular Tires VS. Special EV Tires).

How to Choose the Right Tire Size and Wheels For Your Car.

Hopefully, we will get a better experience from the Costco Auto Program when the current auto market eventually normalizes.

Last and not least, you could use Costco prices as a bargaining tool when buying from other car sellers. It won’t hurt to try it out.

Hello there! My name is Rose. I’m passionate about electric cars and clean energy. My adventurous spirit and journalistic pursuits make each day fascinating and far greater. I consider traveling not just about the grandeur moments, but the little elements that transform the whole experience.