Costco Claims Another Surprising Title

Watch out, AutoNation—the warehouse club may soon sell as many cars as you
By Jenn Gidman,  Newser Staff
Posted Jun 5, 2015 11:58 AM CDT
Costco Claims Another Surprising Title
You can buy almost anything at Costco now—including a nicely discounted car.   (AP Photo/Kalamazoo Gazette - MLive Media Group, Mark Bugnaski, File)

Costco made headlines this week with the revelation that it's America's No. 1 seller of organic food; now it's revving up to grab the top spot in another category: car sales. Nearly 400,000 vehicles were sold through the warehouse club last year—double the amount sold through there in 2008—which leaves it second only to AutoNation, which sold a hair over 530,000 cars in 2014, Bloomberg reports. What's been giving Costco gas in this big-ticket-item bonanza are the discounted prices it's able to offer and the appeal of a no-haggle sale. "I probably won't shop anywhere else," a California buyer who purchased a 2015 Toyota Highlander for about $4,000 less than the MSRP tells Bloomberg.

Costco doesn't actually sell the cars, but instead negotiates prices for its 45 million US cardholders through an auto-buying service, the news service notes. It also retains mystery shoppers to ensure retailers stick to their promised price and works with major manufacturers on promotions: Last year a Costco-GM initiative offered customers who bought a GM car at a set price through the club a $500 Costco gift card; Bloomberg notes that 6% of GM's Q4 2014 domestic sales were through Costco—that's 43,000 cars. Interestingly, Costco doesn't directly make money off of these car sales. Instead—like the hugely popular $4.99 rotisserie chickens it sells, the Consumerist notes—the club offers the discounted vehicles simply as an added perk to recruit and retain members. (More Costco stories.)

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