Costco has been in the car business for years, offering a few vehicles to members at attractive rates. The warehouse chain also sells tires and discounted fuel. Now Costco wants to take its discounting model right to the dealer service bay.
Automotive News reports that Costco has negotiated a 15-percent discount on parts, labor and accessories with select dealerships around the U.S. The move gives those dealers access to Costco's 44 million members, who in turn get a nice break on the cost of parts and labor.
Dealerships typically strive to make enough money in the service department to pay the bills, so this agreement could be very lucrative for retail outlets. Jeff Brandfon of Brandfon Honda in Branford, Connecticut tells AN that the partnership with Costco will result in 500 to 600 customer pay jobs per year. Brandfon's optimism is rooted in statistical proof of Costco's power, as the warehouse chain can point to 250,000 vehicle sales to members in 2010 alone.
Automotive News reports that Costco has negotiated a 15-percent discount on parts, labor and accessories with select dealerships around the U.S. The move gives those dealers access to Costco's 44 million members, who in turn get a nice break on the cost of parts and labor.
Dealerships typically strive to make enough money in the service department to pay the bills, so this agreement could be very lucrative for retail outlets. Jeff Brandfon of Brandfon Honda in Branford, Connecticut tells AN that the partnership with Costco will result in 500 to 600 customer pay jobs per year. Brandfon's optimism is rooted in statistical proof of Costco's power, as the warehouse chain can point to 250,000 vehicle sales to members in 2010 alone.
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