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Costco Auto Could Hit 500k sales | DrivingSales News

Costco Auto Program Could Hit 500,000 Dealership Sales in 2015

October 5, 2015 0 Comments

Costco has cooked up a promotion aimed at making their auto sales referral program more successful than ever. The question is: Will Costco Auto Program referrals produce 500,000 auto sales with help from this seasonal promotion?

Costco is planning to give members hundreds in gift card money if they buy a new vehicle through their auto program. We reported previously the Costco Auto Program generated nearly 400,000 sales through referrals in 2014 and they have launched a promotion to keep strong momentum for the program. Costco is predicting 20 percent growth for the program for 2015, which building upon numbers from last year would put total auto sales arranged through the Costco auto program in the U.S. at 478,650. That 20 percent growth rate year-over-year is five times the expected growth for retail automotive as a whole.

In an effort to hit the desired gains, Costco is willing to give out gift cards to its members just in time for the holiday shopping season. According to a Costco press release, from October 2 though January 4, consumers who register at the Costco Auto website can get GM supplier pricing. That pricing is below MSRP and still includes manufacturer rebates and incentives. For those consumers who opt to visit a GM, Chevrolet, Buick or Cadillac store working with Costco, they can receive between a $300 and $700 Costco gift card depending on their level of Costco membership.

This holiday season promotion proved very effective for dealers last year as 43,400 vehicles were sold using the promotion with a reported 69 percent closing rate on eligible vehicles. Speaking about the Costco Auto program in a press release, John Conlon, Costco Services director said, “Increasing consumer confidence coupled with falling gas prices last year helped crossovers, trucks and SUVs trend higher in 2014; so it’s no surprise that our special offer reflected the same results.”

It’s an initiative that already has competition with Sam’s club launching a similar program. Would your store ever participate in a partnership program with Costco or Sam’s club and do you think the partnerships are effective? Finally, do you think this Costco program can keep momentum going toward 500,000 arranged sales by the end of 2015?

About the Author:

The DrivingSales News team is dedicated to breaking the relevant and the tough stories affecting car dealers. Have questions for DrivingSales News? Reach the team at news@drivingsales.com.

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