Skip The Stores, Let Costco Sell And Service 'em!

[RUCRAYZE]

Costco is becoming one of America's favorite places to buy a car thanks to one huge perk


Business Insider
February 1, 2016

(Reuters)
People filling their tanks at a Costco Gas Station in Carlsbad, California.

Costco’s power in the auto industry is growing.

The warehouse retailer sold 465,000 vehicles through partnerships with auto dealers in 2015, a 16.8% increase from the previous year.

That’s not far behind the No. 1 auto retailer in the US, AutoNation, which sold 533,000 vehicles in 2014.

Costco has one major perk that traditional car dealerships lack: fixed prices. That means customers can skip the bargaining and upselling that is expected at traditional auto dealers.

The company sells cars through 3,000 dealerships to Costco members across the US.

(REUTERS/John Gress JG/GN)

Costco also announced that members bought or leased 58,000 vehicles during its 2015 GM Holiday Sales Event, a 34% increase from the previous year’s holiday-season promotion. More than half of the people who purchased vehicles through the event said they switched to a General Motors brand such as Chevrolet, Buick, or Cadillac because of Costco’s promotion.

“General Motors is pleased that Costco members continue to find our holiday offer with Costco Auto Program valuable,” GM spokesman Dan Flores said in a statement. “We were able to work with Costco Auto Program to ensure that we offered a diverse vehicle selection and value that resonates with Costco members, and received great results that included conquests from other brands.”

How COSTCO is driving ahead with fuel
Discount warehouse chain Costco was already selling some of the cheapest fuel in Australia and now stay ahead, it's adding something to every litre that goes into your tank. Helen Wellings reports.

 

[Rob Croson]

Costco has one major perk that traditional car dealerships lack: fixed prices. That means customers can skip the bargaining and upselling that is expected at traditional auto dealers.

That's a huge benefit. It's the same benefit that Carvana advertises, too, for their online sales. Makes you get the feeling that people hate the dealership experience. The people are friendly and all, but there's always this feeling that you're getting screwed and paying more than you need to pay, or that you're missing some hidden deal or discount. I'd much rather see the list of stuff that's available, the list of features, and the true price. All this negotiating, special deals, factory incentives, dealer cash back, etc., is all a smoke and mirrors campaign to confuse and trick the buyer.

 

[RUCRAYZE]

That's a huge benefit. It's the same benefit that Carvana advertises, too, for their online sales. Makes you get the feeling that people hate the dealership experience. The people are friendly and all, but there's always this feeling that you're getting screwed and paying more than you need to pay, or that you're missing some hidden deal or discount. I'd much rather see the list of stuff that's available, the list of features, and the true price. All this negotiating, special deals, factory incentives, dealer cash back, etc., is all a smoke and mirrors campaign to confuse and trick the buyer.

That will be the EM approach too. Saturn as I recall, gave it a spin. Single woman loved shopping there. One of the big used companies- Car Max? have fixed price.
Saves time, and with E M's 24 hour delivery, spending a couple of hours getting OTD is time wasted. At the stores all the accessories will be displayed, I guess it's gonna be like Ikea, you walk around writing down the items you want, pay, pick 'em up and go. mY only thought is where and how the financial/loan/financing Department fits into the E model.

 

[Rickb]

The direct to consumer one 'fixed price' may be 'price fixed' in favor of the manufacturer. We ass.u.me it's the best price?

 

[Sethodine]

The direct to consumer one 'fixed price' may be 'price fixed' in favor of the manufacturer. We ass.u.me it's the best price?

Even if a fixed price isn't the "best" price, people are willing to pay for a way to avoid the dealership experience. I know I would.

 

[NSTG8R]

The direct to consumer one 'fixed price' may be 'price fixed' in favor of the manufacturer. We ass.u.me it's the best price?

Not going to be a manufacturer of anything very long if the price isn't in your favor. The fixed price (or price fixing) should be a win-win, and everybody walks/drives away happy.

 

[Rickb]

Not going to be a manufacturer of anything very long if the price isn't in your favor. The fixed price (or price fixing) should be a win-win, and everybody walks/drives away happy.

I'm ok with fixed pricing, but the point of marketing the direct to consumer sales model makes consumers feel the price is in their favor.

 

[Sethodine]

I wonder...couldn't Costco operate as a sales point + marshalling center? They could have racks of Elios stacked to the ceiling, and just pull one down with a forklift and plug on the options right then and there. That'd be a sight to see!

 

[Grumpy Cat]

You could probably still get your car serviced at Costco.

 

[NSTG8R]

I'm ok with fixed pricing, but the point of marketing the direct to consumer sales model makes consumers feel the price is in their favor.

Well, the direct to consumer sales model eliminates (or reduces the chance, I should say) the possibility of shady dealerships jacking with the MSRP. Not sure what you mean by "the price is in their favor". You're buying something, the price is clearly marked (no haggle), you know the company isn't selling the item at a loss. Take it, or leave it.