QOTD: Car Buying Programs?

I used Costco to buy an XC60 R-Design WAY back in 2013. It worked great at that time.

I've researched both of these programs. "Car Buying Program" is a bit of a misnomer for both CostCo and TrueCar. What both give you is preset pricing with their respective network of dealers. Depending on the dealer, you're still able to negotiate which is recommended because many reviews, particularly for TrueCar, suggest you don't always get the best pricing. You may not have to negotiate pricing, but you still need to negotiate your trade and haggle with the dealer on financing, add-ons, etc. Also, selection may be limited. CostCo only has approximately 3,000 dealers in their network and TrueCar has about 12,000. Sounds like a lot, but depending on what you're looking for, you may have trouble finding it - especially in this market. Other sites, like Cars.com or CarGurus have over 20,000 dealers. I agree with @Bryan that both TrueCar and CostCo are different from car buying services provided by brokers and concierge services (difference is that brokers get paid by dealers and concierge services are paid by the car buyer). I am partial to the latter because I don't like that brokers basically work for the dealer. That said, both save the car buyer a considerable amount of time and often can save them money -- negotiating on both the price of the car and the trade-in as well as helping buyers avoid over market interest rates presented at the dealership (sometimes dealers have great rates, but often you can do better with local banks and credit unions. IMO, brokers and concierge services are more "car buying programs" than what CostCo and TrueCar offer. One key point, you can still benefit from your CostCo membership if the car you find is at a CostCo dealer - regardless of whether you do the purchase yourself or hire a car buying service to help you.

Everything Chris said is accurate, so I'll just elucidate a little.

You can almost always get a better deal doing your own homework and heavy lifting than using one of these services. However, they "can" be a painless way to procure a car for a reasonable price if you are not up for the negotiations and pain. Kevin the Homework guy did a deep dive into both programs a couple years ago that's pretty detailed.

I will say one thing about True Car that convinces me to warn people away from them - they used to sell your contact information to every dealer in the area when you clicked far enough. This can lead to months of sales folks pestering you via text, phone, and emails even after you buy a car. Not sure if they still do but having used their service as a starting point in my search a couple times in the past...it's painful.

One last note - both programs used to have a bit of a reputation for dealers doing a bait and switch. They would post a car on the programs then when you show up, the car isn't available or was "just sold" then another car is pushed on you that's not so much of a deal. It's always good to call a dealership to ensure what's posted online is available before driving to the dealership.

As with everything car buying...caveat emptor.

I didn't actually engage TrueCar for my last purchase but did use their on-line pricing tool to establish a baseline negotiation price. In my case, I learned about a manufacturer (Acura) to dealer incentive that was worth an additional 5k off my negotiated price. The key was to select a large market (I used Atlanta) on TrueCar so you got the benefit of the competitive market as ATL has multiple Acura dealers. The result was several Atlanta dealers offered me the 2020 MDX AWD Tech package at about 41.5k, more than 10k off MSRP. I presented that price to my local dealer 5 hours away from Atlanta and told him I had zero problem driving to Atlanta. He immediately agreed to match the price and I saved myself the drive to Atlanta. Give it a try, you've got nothing to lose!