Costco Auto Buying Program: Scam or Good Deal?

costcoauto

I’m paranoid about getting scammed.

It’s almost to the point where I don’t even want to answer the phone out of fear I’ll accidentally blurt out my social security number to someone claiming to work at my bank.

When it comes to car buying, my guard goes up like I’m a schizophrenic at a CIA interrogation. 

That’s why I was intrigued when I discovered an auto buying program at Costco. The company’s website claims Costco saves members a lot of hassle and an average of $1,000 off a typical transaction price. It works like this:

Members choose the make and model they’re interested in, then Costco refers them to a local dealer who shows the customer the vehicle’s invoice price, the MSRP, and the Costco no-haggle price.

A no-haggle price with built-in savings sounds pretty good on the surface, but still my paranoia wasn’t eased by browsing Costco’s website. Digging a little deeper online, I found a lawsuit filed in January by a New Jersey woman who says the program is deceptive.

Her main accusation, according the paperwork, is: 

The Costco auto program is misleading and deceptive because its “members only” price is exclusively defined in reference to the “invoice price” of authorized dealers. The Costco auto program does not control the underlying invoice price, and its participating dealers can and do manipulate that price in any number of ways.

A-ha! I knew there had to be something. Everyone knows dealers try to squeeze every ounce of cash they can out of people, so if there’s a price they’ll immediately accept, they must have a good amount of profit built in. Still, I trust Costco….

So I decided to put its auto buying program to the test.

While I was shopping to replace my wife’s car a few weeks back, we looked at getting a 2009 Honda CR-V EX AWD. It was black with a window sticker price of $25,635. We got pretty far into the negotiations before they broke down over the value of our trade-in. The purchase price we arrived at: $23,600.

With this in mind, I contacted the Costco Auto Program with no intent of buying, but to research this story. I wanted to see how close their offer was to the price I negotiated myself. I filled out the online form and waited 24 hours. They never called. So I called the “specially trained” Costco-approved salesman I was referred to and asked what my price would be.

He asked me to come in and see the car. I told him I’d seen it already and just wanted to know the Costco price. I eventually convinced him I wouldn’t come in unless I knew the price was acceptable. 

Then he told me: $23,900.

I admit, I was impressed. I came  to the conclusion that programs like Costco’s just might be worth it if you’re the kind of person who cowers at confrontation and despises negotiation. The deal, at least in this case, wasn’t too bad!

If you’re a negotiation pit bull, though, go after ‘em, and take every hundred you can get!

Would you consider, or have you used, something like Costco’s auto buying program?

-tgriffith

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  1. Kostko
    February 16th, 2012 at 22:18 | #1

    If you can bargain you could get price >$1000 less than costco bs program

  2. Gregg Smith
    January 7th, 2012 at 14:04 | #2

    Hi Patricia,

    Thank you for emailing me, I really appreciate it! I am very disappointed with the Costco Auto Program and I prepared a statement about my experience which I have attached. Please let me know your thoughts on my statement, I look forward to reading them!

    I unequivocally state that if Power Nissan and ABC Nissan are the only Nissan dealers in the Phoenix metro area that participate in the Costco Auto Program, it doesn’t say much for the program or the folks accountable for making dealer selections! Please let me explain.

    First, let’s talk about ABC Nissan, Phoenix. I sold automobiles for many years, Cadillac, Buick, Pontiac, Lincoln-Mercury, Honda and Nissan. I was a salesman at ABC Nissan (The Van Tyl Group) for a number of months and was completely dismayed with their sales process, follow-up and service department. Sales personnel were taught an aggressive approach to customers (“the four square”), emphasizing closing the deal at the most money we could get in the sales process. After the initial sales deal is completed a customer is then referred to the F&I Manager for financing, accessories, add-ons, hidden fees, warranties, insurance and service contracts. There are a thousand ways a dealer like ABC can get an unsuspecting customer’s money! Because they are participating in the Costco Auto Program, a customer may usually “relax” and will trust that the dealer will treat them fairly. Lowering one’s guard at ABC Nissan is a mistake! The longer a customer stays in the dealership, the more money can be had from them! ABC’s minimum time for customers to spend in the showroom is 3-4 hours. ABC had front/rear mount license plates installed on each new car delivery that read “I Got The Deal I Deserved At ABC Nissan.” This was our little inside joke concerning the inability of any customer to break through our aggressive sales techniques and get a good deal, much less a fair deal. This type sales technique is what the buying public finds so objectionable about US automobile dealerships and precisely why auto buying programs have become popular, even if they still may be ineffective. I can tell you from experience, ABC Nissan will get their pre-determined percent of profit one way or another, if not on the final price of the vehicle then somewhere on the back end of the deal as I stated above. Customers cannot beat this system and Costco can do nothing about it! Customers may very well get the “Costco price” but dealer sales people will more than make up for it somewhere else in the deal! It’s why I left the dealership and why I would NEVER buy a vehicle from ABC Nissan, Costco Auto Program or not!

    Now, let’s talk about Power Nissan, Tempe. Using your program, I attempted to purchase a ’09 Nissan cube from Power Nissan in May, 2009. Although I was informed by your telephone representative that the ‘09 cube was not yet on your list of priced vehicles, I was assured that the dealer would price this vehicle according to Costco Auto Program guidelines. That never happened. I paid way too much for the car, not the Costco price. Upon my return call to your program representative, I was informed “there are no guarantees since your car was not on our list!” Very nice way to instill customer confidence in the Costco Auto Program!

    In fact, I had placed a deposit with Power of $500 on the ’09 cube in December, 2008, based solely on the Costco Auto Program recommendation, in anticipation of the announced delivery date of March, 2009. Nissan postponed the cube introduction date to May 2009. In March, 2009, I actually placed an advance order of color, trim level, equipment and accessories with the authorized Costco Auto Program dealer representative at Power. That order was ignored and the CAP dealer rep quit the dealership (was this a clue?). Finally on May 7, 2009 I was offered a just arrived model which was not the color I wanted, but, was equipped as I wanted. Shortly after taking delivery, the car started experiencing problems with the A/C blower. The Power service manager said Nissan engineers, from the Nissan proving ground located in the Phoenix metro area, were dispatched to diagnose the problem, could not duplicate the condition as it existed at the time the service writer initiated the work order, but, replaced the A/C blower anyway. I later discovered this was a lie told to me by the service manager, the A/C blower was NEVER replaced and no Nissan engineers visited the service shop. After a second visit for the same problem, the service tech noted on the work order “customer does not understand how to operate the system”. I can assure you that I am familiar with and know how to operate an automobile A/C system! I have never received one follow-up phone call, letter or email about my sales or service experience at Power Nissan. I chose another dealership for my service needs and I have NEVER returned to Power!

    On August 21, 2011, I contacted the Costco Auto Program on another cube, a 2011 model, and was referred to Power again. I was disappointed to learn that Power was still an authorized Costco Auto Program dealer, especially after the letter I wrote to the program about Power in July, 2009. Perhaps they have improved, I thought, and decided to give them another try. On Sunday, August 21, I spoke with Brian Shirley (he called me) to set an appointment for 2:15 PM, Monday, August 22nd, to see the vehicle and get “Costco Auto Program’s preferred price”. I had a last minute urgent matter and could not keep my appointment with Brian so I called him about 1:15 PM on August 22nd, to reschedule for 2:30 PM on Tuesday, August 23rd, which he agreed. Upon my arrival at the appointed time I was told it was “Brian’s day off” and some other salesman would assist me. I simply left. It seems a simple courtesy call only works one-way at Power and that’s when the customer makes it. I still do not know the SECRET Costco Auto Program price on a 2011 Nissan cube. I never learned the SECRET CAP price on the ’09 cube I purchased! NOTHING has changed at Power Nissan, Tempe as illustrated by the rude manner me/my appointment were handled by the auto program authorized sales representative, Brian Shirley. Fool me once, shame on me! Fool me twice, shame on you! I have NEVER received any acknowledgement from the Costco Auto Program about the letter I wrote to you! I’ll NOT visit or buy another car from Power Nissan, Tempe!

    Based on my personal experiences with these Costco Auto Program recommended dealers and your lack of response to my July ’09 letter, I will not use the program in the future as I am sure there are much better buying programs out there. I would discourage any Costco customer from using your program! I do not believe the program has “strenuous” dealer requirements for participation as has been stated to me by your telephone representatives! I really do not understand how Costco, a really great company with whom I have been greatly satisfied, can subject its customers to such an outrageous program and auto dealers!

    If you are genuinely interested in my opinion and recommendations, CAP should approach Earnhardt Nissan, Superstition Springs Blvd, Mesa, AZ. It’s the dealer I chose for service. They repaired the faulty A/C blower that Power said I did not know how to operate (I can provide written documentation from both Power and Earnhardt concerning this matter, proving that what I assert is truthful) and they have satisfactorily performed all further service needs for me. They have an excellent, Nissan award winning, service department. I, previously, purchased two brand new Nissan Altimas from Earnhardt, an ’04 and an ’07, and negotiated a great price on both. Sales people DO NOT pressure customers, do not attempt to “inflate” deals and ALWAYS negotiate purchase deals fairly and with an even hand! The Earnhardt customer experience has always been an excellent one! There are, and always have been, a host of follow-up phone calls made from the Sales Manager, the Service Manager and a survey taker, in addition to email messages, about all my sales and service interactions with the dealership. They go out of the way to make sure I am satisfied. Based on my 7 years experience with them, Earnhardt Nissan should more than meet your standards for selection and provide a level of sales and service Costco customers really deserve!

    With a Nissan dealership like Earnhardt’s in the Phoenix metro area, you do Costco customers a disservice to recommend Power or ABC. The folks at Costco Auto Program accountable for selecting dealers really should do their homework and their job!

    I‘ll check back in a few months and if Power is still your recommended dealer, I’ll know I was ignored like I was in July, 2009 and will write the appropriate Costco web-site reviews and letters to those accountable. I’ve been a Costco customer over 10 years and my many assessments/web-site reviews of Costco products and services are un-biased and invaluable to other Costco customers!

    Sincerely,

    Gregg Smith

    COSTCO NEVER ANSWERED MY EMAIL!

  3. Autumn
    January 2nd, 2012 at 18:41 | #3

    @ Hoku Gilbert

    We are looking to purchase a Honda Pilot and got referred to Honda Windward through the Costco program. What was the salesman’s name?

  4. kirkland
    November 24th, 2011 at 19:49 | #4

    maybe it pays off to coment online within hours of commenting about no rebate check the dealer phoned and asked us to pick it up. As for the deal we got we made the best deal first when we were doing the paper work the finance staff asked if we were eligable for the costco rebate and trust me it was the best deal around

  5. kirkland
    November 24th, 2011 at 16:50 | #5

    my son purchased a new truck from a regina ford dealer in september fe filled out all the paperwork for costco rebate. marked the box rebate to customer. told by dealer that we would get a cheque in the mail, it’s now the end of november can’t get answers from anyone keep getting told to ask dealer as they mail out the cheque. dealer still looking into it at one point they told me it was part of the down payment,not correct so you tell me ,it can’t be a good thing if you never get your money

  6. JD
    November 23rd, 2011 at 17:40 | #6

    @Filip
    First off. The Costco program is not a scam. It is what it is.A fixed price to buy your car. There are many people who hate to haggle. If they do its a prefect way to buy a car. For all you haggle pro’s out there. What is a good price? Is it the absolute lowest number with no regard for any value of service? If so who do you know you didnt leave any money on the table? Sorry trust me you have no idea. NONE. I dont care what you paid. Someone somehwere would have beat it by some amount either small or large. Of course you would had to spend a crazy amount of time going from dealer to dealer and making call after call. Oh and of course you know gas is cheap so dont worry about wasting that. But hey, I know you pro’s all call and get your number over the phone!! Yeah right. And you drove all the way there heard. “oh sorry it has an alarm on it” or Sorry we sold “that one” or maybe not. So with the Costco program the price is the price and wont be changed. If it does and Costco finds out you are out of the program.
    And another point for all you smart guys. Did you all know most every dealer in the country loses money in the new car department on average. Or makes a small net profit.

  7. Adel
    October 2nd, 2011 at 18:52 | #7

    The Costco Auto Program is no more than a joke. I was able on my own to get $1200 less than what the Costco car affiliate was offering. Yes I used the old technique of knowing what I want first, and then researched what it is worth, and then used the best dealer offer to negotiate with other dealers. The Costco Auto Program is just another way to scam trusting Costco members.

  8. Ric Com
    September 30th, 2011 at 10:51 | #8

    I love listening to all the “gurus” about buying a car! It gets deep at some point and you have to lift your pants so they don’t get any on them.

    Everyone is talking about, discounts, saved $$, etc. there is no mention of customer service or after sale follow up or service depts etc etc. It’s like GEICO, save money, until you have a claim and then you realize they’re going to fix your car with parts from a junk yard! Oh sure they “warranty” the work, but then again its your time without your car when it rots out and they fix again. Same with dealerships. If they don’t make money and sell everything on the cheap, how good do you think the rest of their services are. NOT!
    So when you “gurus of negotiations” are out there, remember there is no free lunch and you pay for your “skills” somewhere else along the line.

  9. jim
    August 4th, 2011 at 05:14 | #9

    Well as a person that has worked at car dealerships, here is the deal.

    You have the price the dealership pays for the car. There is a “minimum” price they will sell the car at and still make money, but of course they want to try and sell it for as high as possible. The “dealer invoice” that programs like this show you are actually a little higher than their minimum sale price. There is no law requiring that car dealerships show you an actual “dealer invoice” of what they pay. The one they show you is just made-up.

    All “incentive” programs that dealerships make, even the costco one, are made up programs. They are made to get you to buy a vehicle. Student discounts, senior discounts, special “weekend sale” discounts, etc are all made up by the dealership to give you incentive to buy. The only discounts that are fixed and real are manufacturer discounts which are given out by the car manufacturer, not the car sales company. Anything else is made up on the spot to get you to buy. If a salesman is talking with a potential buyer and in talking finds out that hes a student, he might say “oh, and if you buy today i know that for this week we have a special student discount 200 dollars off”. Of course you can get the 200 dollars off by haggling if you want, there isn’t any real student discount, just a sales tactic.

    Same with costco. its a sale tactic that gets you into buying the car, and where the sales people can try and get more money out of you by haggling/financing, etc. The NUMBER ONE best way to buy a car is to get 2-3 dealerships of some type fighting each other over the price. Get price from number 1, tell number 2 that number 1 offered this, number 2 will offer that, etc. You will have them calling you at home to try and undercut the other.

  10. costcoautodealer
    August 3rd, 2011 at 14:17 | #10

    Costco has pricing guidelines. If the dealer can’t adhere to those guidelines, Costo requires us to exclude the vehicle. I don’t know where they get some of their pricing figures. We were asked to price a fairly uncommon compact car at $900 below invoice — impossible! I’d like to see proof that ANYONE is offering such a price. Yes, the dealers have a little flexibility, and that’s good due to supply and demand, but if Costco doesn’t accept the price, we can’t offer it at ANY discount — even if it’s significant.

  11. July 21st, 2011 at 20:34 | #11

    I have worked at several dealerships prior to finding my own consulting company, and the Costco pricing was determined BY THE DEALER at each dealership. In other words, there is absolutely no uniformity, and no rules, other than the given dealership must give the “same” Costco price to every “Costco” customer. The fact is, however, that some of my internet clients received even lower prices. Silly program, in my opinion. But good for those that want to “name drop” a BIG NAME, when entering what is undeniably a scary arena for most people looking to purchase a car.

  12. mike kirby
    July 9th, 2011 at 14:03 | #12

    I’ve used the Costco buying program over the last 15 + years without incident (4 cars) until my experience between March & June 2010. Prior to this the program worked pretty much as advertised and I checked Consumer Reports and Edmund’s buying services to home in on dealers cost. The price I was given was always within a couple of hundred dollars of those dealer’s cost and in one case below. These were all new car purchases. In April 2010 I called Costco’s buying service and got the names of the dealers participating and then went to look at cars. The important part you must remember, is to speak only with the names of salespersons given to you by Costco. If you don’t do this the dealers will treat you like just another chump.

    When I settled on Subaru Outback, Limited trim line, I asked for and received an invoice with a price I liked with a salesman that seem honest & personable. I told the salesman that I’d have funds to buy the car in June 2010 once I’d completed refinancing a line of credit on my home and so would be paying cash for the car. Over the next couple of months the salesman contacted me several times to see how my refinance was going. Once I had my cash I made an appointment to go and buy the car, on 6-4-10. Well, within the next couple of weeks things changed a little bit for me. The day before the car dealer apt. my mother passed away. So, I when went to buy the car on 6-4-04, the salesman asked me how I was doing. I said, truthfully, not so hot, but, I still needed the car. The salesman then asked me what price had he quoted me. I handed him a copy of the invoice he had given me in April. He looked at it, asked me a few questions for title purposes and mentioned that he had a new manager and was not so sure about the invoice price he had previously given me. He said he had to talk to the manager. When he returned, he pushed paperwork across the desk @ $1200 higher price than the previous invoice. I calmly told the salesman I was not going to pay anymore than he had quoted me, that his sales tactics were deceitful and that I’d just have to buy the car from another dealer. I walked out and vowed that I wan’t going to let this matter die. If the salesman had been any type of empathetic, human being, he would have said, I’m sorry for the loss of your Mom and I can’t sell you the car for what I quoted you. Had he done that, I would have just probably forgotten about it and found another dealer without complaint. But no, this weasel just had to see if he could reel in another deal.

    During the next 10 days I wrote a pointed letter to the dealership complaining of this treatment and sent a copy to Costco advising them I had never had such bad treatment with my previous car purchases. The dealer said the high trim line on the car and demand for it meant they couldn’t sell it to me at the price previously given, telling me it was simple miscommunication issue. I told Costco that was not the case. On further review Costco found out that the salesman I had dealt with was not an authorized Costco dealer contact, although he had represented that to my wife and I. I thought that Costco would blow me off too but
    then they apparently paid attention that I had used their service on several occasions. I was later contacted by one of the managers of the Costco buying program, who felt that the dealer had not acted in good faith. When she asked what they could do to make things right, I told her they could find me the car I wanted. After a couple of days they gave me a dealers name about 90 miles away. I contacted the dealer, took a train 2 days later. The dealer picked me up at the train station and after 30 minutes of no B.S. purchasing, I was driving my new car back to San Diego. As for the dealer who gave me the runaround, who owns numerous car dealerships in San Diego County, whose motto is “it’s so nice to be nice”, he has a huge lawsuit on his hands stemming from a defective car he sold (not a Subaru) to someone. What else has he lost? My business and hopefully many others. I’m getting ready to buy another car and will definitely rule out any dealership he owns, whether referred by Costco or not. People who have bad experiences such as this cause dealers to not only lose car sales but also a sales/service relationship that stands to make them a lot more money that the sale of one car. This dealer was to blind to see the bigger picture.

  13. Hoku Gilbert
    June 19th, 2011 at 13:24 | #13

    I just had a very unpleasant experience with the Costco buying program involving Honda Windward in Hawaii, but I believe it was largely due to the bombastic style of the salesman. As to that, he refused to let us see the car until he had gone through his entire “presentation”–which takes TWO hours. This presentation involved being locked in his office, with him spending the majority of the time talking very fast about Consumer Reports ratings, paint quality (why?), bad mouthing the competition (in this case, Toyota) and basically telling me how great he was at sales and how little I knew about cars (and therefore should trust his expertise). He got in to a shouting match with my husband at one point and told us he didn’t need our business because people buy cars from him and Costco all day long. He was 15 minutes late for our appointment with no apologies. He didn’t even have a clean car ready to show us. Despite my repeated requests that I just wanted the price and I wanted to see the car, he refused to accommodate me in any way. He also kept trying to sell me a car with upgrades that I didn’t want, completely ignoring my wishes in the process. If such is the Costco mandate–grind through this presentation no matter what the objection from the customer–then Costco didn’t make the process any easier for me. I will happily return to the old-fashioned way of buying cars–finding a salesman who listens to me, takes an interest in my questions and concerns, doesn’t trash the competition, and finds me the car I want, not the car he wants to sell me. And I will gladly pay more for the privilege. It’s not always about the money.

  14. tgriffith
    June 12th, 2011 at 10:35 | #14

    Thank you Lori for sharing your positive experience!
    You might consider leaving a review of the dealer on the CarGurus dealer review section:
    http://www.cargurus.com/Cars/reviewDealer.action?pid=dealerSideColumn

    Enjoy your new Juke and congratulations.

  15. Lori
    June 11th, 2011 at 22:18 | #15

    Back to NH w/Juke in the driveway. We had an excellent experience with our Costco referred dealer! Everything was as expected; no surprises! The sales staff was professional, friendly, and knowledgeable. This may have been the best car buying experience we’ve ever had. Kudos to Costco, and to Crowley Nissan in Farmington, CT!!!

  16. Lori
    June 11th, 2011 at 05:58 | #16

    I have always been a big Costco fan and the Auto Buying Program lived up to my high expectations. In my case, I was looking for a car that was in very high demand and negotiations with dealers was not an option. I am on my way this morning to pick up my Nissan Juke. All the dealers around are selling what they have (and none have the trim I’m looking for) at MSRP, with a couple actually adding an upcharge! Because Costco already has a deal in place with it’s program dealers, we are getting the car for invoice, which is $1500 under MSRP in a market where no dealer is willing to haggle. The dealer contacted us immediately by email (and it was in the evening). I called the next morning, spoke with a polite salesperson who told me what the price would be (to be honest, I was surprised the dealer was even willing to admit they had this car on the lot, since they could have sold it at full retail to someone and probably the same day). The salesman emailed me a copy of the window sticker,which was oddly a $640 LESS than Edmunds! The dealer conveyance fee was consistent with other dealers. Bottom line – we are driving a long distance (would have had to any way, for the Juke we wanted) and are getting it for 402 under invoice, and 1991 under Edmunds quoted MSRP! That being said – if it were an Altima, or other car the dealers have lined up in their lots in abundance, armed with the TMV report from Edmunds I’m sure we could have haggled a similar deal. Gotta go get my Juke! If my experience is anything short of pleasant and professional, I will report back tomorrow!

  17. Alex
    April 25th, 2011 at 19:22 | #17

    In my recent experience, the Costco Auto program offer consumers good prices but not great prices. I recently bought a Toyota Prius III. The MSRP was $25,010. The Costco price was$23,010. The CarWoo.com Marketplace where they had 7 dealer competing for my business was $22,388. The Costco program had no competition amongst dealers, so pricing is just OK. I was very happy to save more than $600 using CarWoo. The online service did cost me $49, but the fact that I could save about $600 was well worth the money and time saving of not having to visit a bunch of dealers to get the best deal from Capitol Toyota.

  18. CostcoAutoDealer
    March 16th, 2011 at 13:39 | #18

    FWIW, there’s no “committing” to the Costco Auto Program. If you can find the vehicle for less, or if you enjoy the negotiating process, buy the vehicle elsewhere.

  19. Paul W.
    March 11th, 2011 at 02:09 | #19

    WOW! I am glad I visited this web site as well as one other site before committing to the Costco Auto program. I am guessing, but I believe customers bad experiences out number the good 9 to 1 at best 8 to 2!
    Think I will try the online Edmunds thing.

  20. Karen
    February 22nd, 2011 at 21:03 | #20

    We purchased a 2010 Ford truck through the Costco program in the fall of 2009. It was so easy we plan to do it again with a car next year. When I contacted the Costco Auto Program regarding our interest in purchasing the truck it was literally only a few minutes before we received a phone call from the authorized dealer. Their deal was straightforward. They said the truck would cost inventory price minus any incentives in place at the time of purchase. I obtained inventory prices independently on line and they were exact to the dollar of what the dealer had in their computer. We factory ordered exactly what we wanted and we paid exactly what we expected, which, due to a promotion, was $1000 under invoice. Plus, we were offered 0% financing. There was never a hint of having to negotiate and we feel we paid less than what we would have paid if we had haggled from the sticker. I think the success of the program probably has a lot more to do with the dealer than with Costco.

  21. Richard Carstairs
    February 16th, 2011 at 13:04 | #21

    Costco after purchase? Are there any stipulations on the resale of a Costco purchased vehicle? I am looking to purchase a Toyota Tacoma “Prerunner”. (a model that is not available here in Canada). A U.S. Relative of mine would be purchasing the vehicle and then reselling it to me. Are there any issues with this transaction?

  22. Willis Wunder
    February 13th, 2011 at 17:36 | #22

    I also went through the Costco auto purchase program and eventually negotiated a price much lower than the Costco price. Based on my experience, the so-called Costco “discount” if any is minimal, and the Costco program is a waste of time.

  23. Denise-Phoenix Az
    February 12th, 2011 at 15:55 | #23

    @CostcoAutoDealer

    I am a member of Costco buying program as well and Consumer Reports program. At a Nissan dealer I took my car in for servie. I love my car 06 Murano. The driver seat came unmounted and I was tipping over when I drove. Nissan said $900 to fix the it the cheap way. In the mean time, actually prior to this, I called service and had an appointment. Service sent a car sales man to me while they looked at the Murano.
    I repeatedly said I was Costco and Consumer Reports, pulled up all the internet information and was told by Nissan that Costco and Consumer Reports are “nonense” according to my Asian sales man.
    Part of this was my fault for getting sucked in to it all and looking at cars in the first place where they BLOCK my ACCESS to internet and fleet sales. The minute one sales guy talks to me, 5 others come along as well. I was blocked from fleet, should have walked away, and not paid top dollar plus a down and retate rolled into negative equity and I am upiside down in a car for which my Fibromyalgia/chronic pain won’t even let me drive. I had no idea when I purchased the car which now has
    500 miles on it that I could not drive it more than 30 minutes. I am too crippled up with Fibro and other issues with arthritis that I can’t get out of the car after 20 min, I can’t lift groceries from the trunk.
    Consumer Reports called to follow up on the transaction and I told them I had Costco and CR pricing and did not get the stated price.
    The dealer addes Zak-tec paint protection to all cars, they add tinted windows, etc.
    I called the dealer and let them know I was having issues and sales again blocked me from fleet. I was allowed to try a Cube and a Altima but has similar issuse. The Altima was actually a better fit with the power seats, like my Murano. With the arthritis and medical issues I can’t get the manual seats and steering wheel to work, the seats lack padding and my back kills me also.
    I walked out , took the original car and figured I would try another car dealer. Bottom line, Nissan had the Murano that I had that I could drive, none of the others work either, The Altima sits lower than the Sentra and still lacks pull up handles on the drivers side to get myself out of .
    The deal is done , the dealer does not have to do anything and the idea of pushing me to buy anohter new car and again be blocked from the Costco/CR buying program = and it seems that has add ons. The dealer assured CR I was getting invoice but I never saw it. Maybe Invoice with a ton of addons.
    Fleet sits in the same room with the other store managers and to CR what they wanted to hear. Same with Costco program. With Midway Nissan anyway.

    This was my last car purchase from this dealer. They are all nice I give them that but what sales person is not nice.

    NoW I have a 12 day old car I can’t drive, Sales should make sure Costco members go to Costco fleet instead of fighting each other for the sale at the expense of the customer. Especially where a dealer outright refuses to allow you to use Costco.

    Now I must wander to other dealers in the Costco plan and Consumer Reports, I will forever question the sales and fleet and never know who is telling the truth.
    I did find a Pinacle Nissan and they man was amazing and kind on the phone and explaied things to me that my Nissan dealer did not.
    I am sure the program is good but buyer beware. The car dealers are ruthless and they back each other in sales.
    Pinacle Nissan was kind enought to explain that they do have to answer at the end of the year to Coscto regarding the program and that made me feel better.
    Research your dealers and be careful.

  24. CostcoAutoDealer
    February 10th, 2011 at 07:12 | #24

    Hello again,
    I wanted to add the following:

    As a Costco Auto Program participant, we are required to do a few things:
    – Ask to see and make a copy of your Membership card. This doesn’t always go over so well if your card is also your AmEx.
    – Show you the invoice sheet
    – Show you the Members On;y Price Sheet

    If you go to a dealership, and they don’t show you the price sheets, tell them they are required to as part of the Program.

    FWIW, Costco tells us not to give any pricing over the phone or through e-mail. As I mentioned in my earlier post, I do it anyway for people who aren’t local. The point is supposed to be that you get the best price first, and it cuts out the whole negotiation process.

    Costco would rather have us exclude a vehicle than offer a small discount on it. For example, if a hot new car comes in, and we’re selling it at MSRP, but we’ll take $500 off for Costco Members, they won’t let us publish it because it’s not a high enough discount. Kind of twisted, right?

    Also, we are supposed to treat Costco Members with the customer service they expect. I try to treat everyone, no matter how the sale initiated, respectfully. I have had some awfully rude Costco Members be verbally abusive to me for no apparent reason aside from the fact that I work in a car dealership. I’m a Costco Member, too, and I just don’t get the whole entitlement thing. Just because you pay $50 (or whatever) ayear, that doesn’t give you the right to be a jerk to me. FWIW, as a participant, our dealership does not get ANY benefits from Costco — no free memberships, no discounts, no cookies… nothing.

    Again, I think it’s a great program. Costco is very quick to call us if there’s a complaint. If you have a bad experience, let them know. If the dealership consistently fails, they will be kicked off the program.

  25. tgriffith
    February 9th, 2011 at 11:28 | #25

    @ CostcoAutoDealer
    Thank you, CostcoAutoDealer, for sharing your side of the program. You’re honesty and insight into the process is refreshing!

  26. CostcoAutoDealer
    February 9th, 2011 at 09:47 | #26

    I am the Costco contact person at a dealership. There are a few things I would like to share. Being part of the Costco Auto Program is up to individual dealerships. We PAY to be part of the program. It’s not our fault, or even Costco’s, if there’s not a dealer closer to you. In fact, my dealership is in the middle of two other major cities that don’t have an Auto Program presence. When I call people in these cities, they often get mad or hang up on me. Honestly, I think it’s worth driving an hour to potentially save a few thousand dollars.

    Costco doesn’t like it, but I DO quote prices to people who live out of my metro area. About 50% of the “serious” buyers make the trek to my store. I’m certain that the others take my pricing to the local dealership and ask for it to be matched. Why should those dealers pay to be part of the program? I’ve already done their work for them.

    Our Costco pricing is, in fact, almost ALWAYS the lowest price. Is it possible that you MAY get a lower quote somewhere else? Sure, but I doubt it’s going to happen if you don’t show them the price we quoted you.

    PLUS, Costco Members receive an ongoing discount on parts & services; that adds up during the course of ownership.

    Costco is very rigid in their process. If you complain about us; we hear about it.

    We don’t charge any extra fees. If we have to do a dealer trade that’s more than ~150 miles away, we may require a small fee to pay a driver to go get the car.

    We are required to show you the invoice sheet and the Member’s Only Price Sheet. Everything is in front of you. Yes, your trade is the wildcard. I’ve been in this business for 8 years and have RARELY met someone who is happy with what they get on trade.

    All Costco sales are “mini deals” for our Sales Consultants. They make $100 flat because there isn’t any “gross” in the deal. The idea is that the pricing is already done. It *should* be a smooth transaction.

    I’m proud to be part of the Costco Auto Program and don’t understand why a dealership wouldn’t want to participate. I take pride in offering a great benefit to both our customers and Costco’s customers. I’m glad I work in an ethical car dealership; I wouldn’t have it any other way.

    I can’t speak for all dealerships. I hear horror stories, too. But we’re not all thieves and slimeballs.

    Hope this helps.

  27. February 2nd, 2011 at 13:17 | #27

    @ Lili
    The best way to see the invoice price is to simply ask the dealer to show it to you. But first, research on sites like cargurus.com and edmunds.com to get an idea of what the invoice should be. Then, you’ll be prepared to negotiate from invoice price instead of MSRP which should save you money.

  28. Lili
    February 1st, 2011 at 23:03 | #28

    Where do you find the invoice price of cars? Looking to buy a Kia Sorrento 2011 or Rav 4 2011 and am not sure where I can find the invoice price.

  29. amzad
    January 3rd, 2011 at 02:45 | #29

    Nice job!…….Nice Service and experience was very Nice

  30. December 30th, 2010 at 11:37 | #30

    I have purchased two trucks through the Costco program. The first was in 2005 through Pacific Coast Ford in Seattle. I signed up online for the Costco program and they put me in touch with the dealer. They charged me a flat rate of $500 over the invoice price. I use Edmunds.com to compare invoice and MRSP prices and everything matched. I ordered a F350 King Ranch with all the options I wanted from the factory and it arrived about 8 weeks later and everything was fine. Presently, I have again ordered a truck, a Ford F150 Platinum with the ecoboost engine, through the Costco program. This time Costco referred me to Horizon Ford in Seattle (as Pacific Coast Ford is no longer in business). This time the cost is the “Costco Price” which is about $300 less than the Edmunds.com TMV price (about $1800 more than invoice cost per Edmunds.com). This dealer (internet salesman Arthur Harris) has not provided me with the invoice costs (I didn’t ask, he didn’t offer) but my research online seems to be consistent with the numbers I have been quoted. There have been no “etching fees” or “Costco user fees” and if any of those red flag items were ever mentioned I would have immediately said goodbye. I suppose there are some crooked dealers out there that will try to get your money one way or another (imagine that!).
    So, the bottom line for me is, if Edmunds.com is a trustworthy source, this deal is not as good as 5 years ago but I am still getting a reasonable deal and I get exactly the vehicle I want and I don’t have to step a foot into a dealership until the day I go pick up my vehicle (priceless!).

  31. CarShopper
    December 29th, 2010 at 17:20 | #31

    Waste of time! The Costco Auto Program price was by no means competitive!
    Do your homework, and you’ll find you can get a better price on your own.
    Besides, the dealer did not have the product in his inventory. He only said that he did in order to get me in the door!

  32. Nitin
    December 21st, 2010 at 09:49 | #32

    @ Nitin
    (Sorry, I meant $400 doc fee; the $750 destination was included in the $17.8 invoice price.)

  33. Nitin
    December 21st, 2010 at 09:42 | #33

    Not a scam. But definitely not always the best deal. For the 2011 Honda Civic LX the Costco price was $400 over invoice as of December 11, 2010. That’s $17.8 plus $400=$18.2. Plus $400 destination charge, $500 tax, $100 registration, and $250 in worthless add-ons, and suddenly we were up to about $19.5k OTD for a car whose MSRP (including destination but excluding tax title and docs) is $19.3k.

    I had done my homework and gotten Internet quotes from local dealers through Edmunds. To his credit, the Costco partner dealer matched the price I had negotiated with a nearby dealer, so we paid $16.5k OTD, $3000 (or 15%) less than the Costco price. And to their credit, when I noted on the Costco survey that I wouldn’t recommend the program to someone else, a Costco manager called and we discussed the experience, and they still gave me the $50 executive member gift certificate for parts & service. Overall, the service was top notch as always, but the savings just weren’t there for this particular model.

  34. tgriffith
    November 22nd, 2010 at 15:50 | #34

    @ rose
    Hi Rose,
    Most (if not all) dealers have an internet sales team. SImply put, it’s just a salesperson who is responsible for dealing with online inquiries about cars. Often they can provide a simple no-haggle price that you can choose to accept, then go to the dealership and complete the paperwork. To access that person, simply find the dealer’s web site or just call the dealer. All of your potential vehicle choices are great cars. Be sure to schedule test drives for each one to find out which truly meet your needs.

    For more tips on buying new, check out this article:
    http://www.cargurus.com/blog/2009/01/12/eight-simple-rules-to-getting-the-best-deal-on-a-new-car

  35. rose
    November 21st, 2010 at 21:11 | #35

    @matt

    I’m going to take you up on your offer for more advice/tips on buying a new car. I haven’t bought one in 19 years! Not sure what this internet sales team is — is there one for each auto maker? How does one access it? And any other tips/info would be greatly appreciated (Am going to test drive Hyundai Tucson; Honda CRV; Suburu Outback; Suburu Legacy; and possibly Ford Fusion, then decide which car and which trim –it will probably be a higher-end trim line whichever make I choose, because of certain features I want.

    Thank you for your time.

  36. ROC
    November 9th, 2010 at 15:29 | #36

    Costco Auto Program is definitely a scam. I was trying to avoid all the hassle, so I signed up the program and contacted the dealer (Marietta, GA). However, the experience was a completely disaster. First, the dealer’s attitude was horrible, basically he didn’t care if we purchased the car or not. He didn’t even offer to show us the car until we asked. Second, he refused to notify me when the new car was delivered. He said that he “might” call if the car was not sold yet. Finally, he gave us some price which didn’t sound right at all. After that, we went to another dealership which didn’t have partnership with Costco so we can check if the price was right. Surprisingly, their price was $1,000 lower than Costco dealer. Yes, ONE THOUSAND dollars less without negotiation. Plus, the interest rate was 2% lower and they treated us much nicer. Costco did a follow up call two days after and I told them this program was a joke. Not only I will never participate it again but also I will STRONGLY encourage everyone not to fall in the same trap. Overstock.com offers the similar program and you can complete all the process online. Don’t waste your time, Costco Auto Program is not even worth to try.

  37. October 26th, 2010 at 17:24 | #37

    question

    Was Costco rebate of $1000 in effect during July and August????

  38. Josee from Orange
    October 18th, 2010 at 14:29 | #38

    I called Costco for an appointment with a Toyota dealer. Costco gets a commission on every sales. I went to meet with the dealership with whom I had the appointment set through Costco and then met with a different dealership to deal on my own. I wanted to compare. I ended up saving more doing it on my own. On my Toyota Sienna 2011 the Costco deal was $500 OVER invoice and I negotiated without to much haggling, a deal of $200 UNDER invoice with a different dealership. So a $700 difference. So the Costco deal is too good to be true. Plus it feels like a scam.

  39. chbender
    August 14th, 2010 at 14:53 | #39

    Is the “Invoice Price” meaningless? My wife and I have been looking for a new car and this summer we were also traveling to weddings in Kansas City, Minneapolis, and Atlanta. As an experiment we shopped for a car (Chevy Impala) at a dealer in each city. We eventually got an “Invoice Price” at each dealer and guess what, they were all different for an identically equipped car. The difference between the lowest and highest prices was $850. Anyone know why there is such a big difference? Is the “Invoice Price” just as meaningless as MSRP?

  40. Bob Joseph
    July 22nd, 2010 at 19:43 | #40

    I thought I was given a good price at the beginning of our talks.

    However and this is a major However LOL
    When I was ready to go to contract on a Nissan Altima the deal went South.

    This Ct dealer started adding in all there fees.
    1 $ 400 Conveyance Fee
    2, $ 299.00 Vin etch fee on the windows
    I was not able to negotiate these Fees away
    I was told these were standard fees in CT
    I checked Nissan dealers in NY and was given a better price without Costco and with out those Bogus Dealer Profit Fees Conveyance and etching fees

  41. Jay Sojdelius
    June 7th, 2010 at 14:42 | #41

    I researched the Costco Auto Program myself and the experience was very disappointing. Nearest Costco-authorized dealership to us was 70 miles away (and we live in Chicago!). We were not contacted by one of the Authorized Contacts but by someone else who asked us to e-mail him on his Hotmail-address. No-one ever showed us a dealer invoice price and the “special” Costco price offered to us turned out to be 10% higher than the manufacturer’s listed MSRP, which is clearly stated on their website. The actual price we managed to negotiate at a different dealership, for an identical vehicle with the exact same options, turned out to be 80% of the Costco member’s price. You do the math. I think walking into a dealership wielding your Costco member’s card is equal to wearing a big sign that says “sucker”.

  42. March 21st, 2010 at 06:56 | #42

    I received 5200 in discounts of MSRP and it beat all other pricing!

    The program works if you are an informed consumer and bring your edmunds TMV pricing sheets and do your homework. If you look like you just got off the boat most auto dealers will treat you as such. I did my homework and researched a 2010 Maxima SV. I found that the costco rebates as well as dealer rebates exceeded 5200 on a 34950 auto. They even offered me 1.9% financing with all theses rebates. The final sale price on this auto was 29700 and that is approximately 1100 less than the TMV prices from edmunds. The program works and don’t be discourage by the ignorant that think the world is out to get you. If you walk into the dealer with no clue of what others are paying and what you should be paying then I hate to say but you get what you deserve. Don’t be a fool, do your research and let the dealer know you are going to more than one dealership they will fight like rabid dogs to earn your business. To those that had a bad experience consider this “DID IT REALLY HAVE TO DO WITH COSTCO?” or did it have to do with your poor preparation and inability to show the dealership(s) that you know what you are talking about and were only willing to accept their best deal. Caveat Emptor! (that’s latin for let the buyer beware)

  43. John Gray
    March 14th, 2010 at 09:53 | #43

    February 22, 2010

    My complaint has to do with my impressions and personal opinions regarding COSTCO Auto Program. Negotiations with a dealer for purchasing a car through COSTCO Program began on and around January 20th. 22010. I am a long time member of COSTCO Buying Program and with the exception of auto purchases have had good experiences with the company. This is my 2nd attempt at trying to purchase a car through the Program.

    ADDRESS OF COSTCO

    COSTCO Members

    Senior Management/ Board of Directors

    Corporate Offices

    999 Lake Dr. Issaquah, WA98027

    Summary Statement: It is my view that the Toyota dealer mentioned below would have allowed me to leave his lot with a vehicle having accelerator defects; the very same defects which may have caused the deaths of several Americans; these defects were a matter of public knowledge. It is my belief that the dealer may have had advanced knowledge of the stoppage in sales because of a defective accelerator. As a matter of fact, the Wall Street Journal published a directive from Toyota on the 22nd of January: the paper reported that all dealers should stop selling 2010 Camrys and 2007 Avalons. The time period is precisely the same time period when I was negotiating with the dealership listed below, and encouraged by sales representatives to sign an agreement resembling a post dated check, then to drive a 2010 Camry off the lot.

    Specifically, my complaint is against COSTCO Auto Program. I believe that the program should have provided information about problem vehicles to consumers. COSTCO Auto Program, responded to my initial complaint by defending the dealer. Instead, the Costco Auto program, should have taken strong and deliberate steps to make absolutely certain, that members are protected from unethical dealers.

    ..

    Short Form My Personal View:

    1.) Upon entering a dealer’s place of business and after asking to see the invoice and the Buying Program discount sheet, a Costoc member has no way of knowing whether the dealer is providing reliable information. Is the paper actually the invoice? â?¦an approved “Costco Auto Program Discount” sheet?

    2.) Upon entering a dealer ship for comparison purposes; that is, at a time when you are merely checking out vehicles but basically undecided, a salesperson may disregard your affirmations about being a Program member and/or misrepresent himself as an authorized cooperating COSTCO representative.

    Address

    Mr. Stanley Managerl

    Power Toyota

    7970 South Autoplex Loop

    Tempe, AZ 85284

    3.) Finally, COSTCO Auto Program does not give warnings at the time of referral. In other words, certain makers may have made vehicles that developed mechanical problems in the past, but COSTCO doesn’t seem to provide information regarding problem vehicles.

    A Very Dirty Trick: My Personal View

    Following is a narrative detailing my impression and opinions about a recent experience during late January of 2010. My objective was to purchase a 2010 Camry or 2007 Avalon.

    The Wall Street Journal reported that Toyota Corp had stopped all sales of several vehicles on Jan. 22nd. On Jan. 23rd, I was talking to two Toyota Dealerships, comparing prices.

    1. Power Toyota (mentioned above.)

    2. Riverview Toyota (located in Mesa, Arizona)

    Both dealers, on the 23rd, made attractive offers, and seemed willing to have

    Me drive the vehicle off their respective lots. I decided to close at Power Toyota, but for financial reasons, I wanted to delay the final transaction until

    the 25th..

    So the actual transaction would have occurred on Jan. 25th, a dark day in Toyotaâ s history.

    â?¦

    Run for it. Here comes the really, really dirty part.

    Mr. Thomiisian, together with ânother sales person ‘ian’ insisted on Jan. 21rst or 22nd that I purchase the 2010 Toyota on the spot. (In reporting this to Costco, I made a mistake, with respect to dates.) The two men insisted that I;

    a. Sign a contract that functioned as a post dated check.

    b. Take possession of the vehicle, immediately, and drive it off the lot.

    At this point I became suspicious, went home and checked with COSTCO. It turned out that the lead sales person Mr. Thomisian was not a COSTCO representative. The price he quoted for the vehicle was not a COSTCO price.

    ..¦

    It is important to bear in mind that my negotiations with Power Toyota were b

    Response from COSTCO: The Nasty Part

    Why join an auto club if you are not sure of getting a fair deal? My purpose for joining Costco’s Auto Program was to obtain protection from unscrupulous dealers and to obtain a fair price.

    In two cases, that didn’t happen. In one case, Showcase Honda, my wife and I were treated like criminals, and now–at Power Toyota, I came within an eyelash of purchasing a car that might have been a deathtrap. The same scenario might well have been repeated at Toyotaâ??s Riverview Toyota in Mesa, Arizona.

    Again, everything written above is my personal opinion. I believe that my version of events is true, and I am willing to make corrections to any false statements. Copies of this complaint have been forwarded to Costo Auto Program and to Power Toyota. I have invited both organizations to make corrections.

  44. Jeffrey
    March 14th, 2010 at 09:02 | #44

    BTW, East Coast Honda did not charge any fee to use the program either. That would be a BIG red flag IMO.

  45. Jeffrey
    March 14th, 2010 at 09:01 | #45

    I used the COSTCO buying service this week. Like many I shopped online first and then got the COSTCO price. I was extremely happy with the experince and the dealer they referred me to. They responded to my inquiry the same day and it was a very easy process. I’m not sure about other areas, but in Myrtle Beach SC, Costco and East Coast Honda could not have been a better buying experience.

  46. Filip
    March 3rd, 2010 at 09:46 | #46

    @ernesto read my previous comment about the Lexus. The Costco program is useless for luxury brands. I happened to have a good experience with it buying a toyota, but most of the comments in here, suggests the program being pretty lame, and nothing more than a referral program without any real substance to it.

  47. ernesto
    March 3rd, 2010 at 02:46 | #47

    @ filip – i was hoping that going on sunday feb 28, i could get a good deal but it didnt happen. the $750 fee to use the program is what surprised me…i knew something was wrong there.

  48. ernesto
    March 3rd, 2010 at 02:44 | #48

    You can get a better deal yourself with a little research….read below.

    I tried to use this over the weekend. Shopping for a 2010 Acura TSX which on the website is 26,959 plus 810 destination charges. I go to the dealer and they say that price is wrong The costco price for the car is $27359 plus 810 destination charge…PLUS THIS IS WHAT GOT ME – $750 TO USE THE COSTCO PROGRAM.

    Salesman didnt make the experience any better. I wanted a white car with black interior, low miles. He said that his manager tried to locate that and they couldnt find one in all of Southern California. All of a sudden they did find one but they had to get it from another dealer and it would be an extra $200.

    I headed home and went to edmunds.com and carsdirect.com to do more research on the price and get quotes from other dealers. Next day, I get an email from a dealer that has the exact car I’m looking for and the price was $26998 with destination charges. After all my researching and quotes from other dealers, this was a good deal especially with 1.9% financing for 36 months.

    Planning to give costco feedback on this experience. I’m not going to cancel my membership but the auto buying program wasn’t what I was hoping it to be.

  49. Filip
    March 1st, 2010 at 12:17 | #49

    hi Zoey ,
    If a dealer wont give you a price over email or phone, then they want to haggle. My advice, ignore them, don’t go there. Most dealers understand that there is a competitive market and have a “internet department” assigned for customers that shop around over email and the web.

    As for the Costco “special price”, I am now convinced it doesn’t exist. I had a good experience, but that is cause the dealership I dealt with made it really simple. I was able to custom order a car for $400 over invoice. And the dealership always printed the invoice prices for me, not the MSRP. But the Costco auto program is nothing but a bogus referral service. I’ve heard enough stories by now about people not being given a quote when they did the costco autoprogram, they just were told there is a “fixed” price. Well, that means nothing.

    So keep shopping around until you find the best deal. If you want to haggle, go into the dealership the last three days of each month, when they have to make their numbers.

  50. Zoey
    February 27th, 2010 at 17:35 | #50

    Hi! Zoey is back! :)
    We finally decided that we wanted a 2010 Subaru Impreza wagon. The local costco dealer wouldn’t respond to internet pricing request, and insisted on that we step in and sit down to talk about it. There was a monster blizzard in Pittsburgh the day we wanted to go there, so we haven’t had a chance to visit them. Meanwhile, a local dealer was willing to match the price we found on Fitzmall, so most likely we will be getting our Impreza there.
    I am still very curious about the costco special pricing, though, as the sales manager told me the member’s price is lower and they’ve been doing business with costco for several years.
    We also tried to quote Sam’s club member’s price at another dealer. They did emailed us a decent price, which was lower than those first prices most dealer gave us. :)

Comment pages
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