Why GM is using Costco to sell Cadillacs

Costco has been facilitating new vehicle sales through its Costco Auto program since 1989, offering its members special discounts and incentives on select makes and models. GM has participated in the program in the United States since 2011.

GM is now leveraging its partnership with Costco Auto in the US to sell EV models such as the Chevrolet Equinox EV and Blazer EV and Cadillac Lyriq, the latter of which is set to arrive Down Under later this year.

Costco members throughout the US can currently access a US$1000 (A$1515) discount on the electric Chevrolet and Cadillac crossovers until July.

"Our membership has always liked new things, and EVs are absolutely new to the marketplace," said Jay Maxwell, Costco Auto Program general manager responsible for strategic partnerships, to CNBC.

"This is a great way for the [automakers] to market and get their EVs out in front of people that are interested. Costco has a very strong demographic that fits well with EV buyers."

"There's some pretty strong incentives going on in the market for EVs right now, so they get that additional value on top of it.

"It really makes it a compelling offer to somebody who is considering an EV."

As well as partnering with manufacturers, Costco Auto teams up with franchised dealers as part of its Everyday Auto program.

CNBC reports new car deals are generally offered for between two and three months, with manufacturers and dealers paying Costco Auto a subscription fee to put deals in front of Costco members.

The retail giant says that since 2019 it has facilitated an average of 500,000 car sales each year in the US.

Used car sales, maintenance, and servicing also fall under the Costco Auto banner.

Volvo and Polestar also offer their vehicles through Costco Auto in the US.

The Australian arm of Costco established a similar venture late last year, called Autoconnect.

A joint venture with car broker Autoreviewa, Autoconnect enables Costco warehouse club members in Queensland, New South Wales and Victoria to purchase a car from a list of selected vehicles online, at a discounted price.

In addition to drive-away savings, Costco members who purchased a car through Autoconnect can also receive vouchers to use in-store.

Vehicles from Ford, GWM, Jeep, Kia, LDV, Mazda, MG, Renault and Suzuki are among those that have been offered by dealers via the Autoconnect platform.

Cadillac will officially launch here this year with an electric-only lineup. It has only confirmed the Lyriq thus far for Australia, but Cadillac has revealed a whole range of electric SUVs consisting of the Optiq, Vistiq and Escalade iQ.

It will sell its vehicles through two Experience Centres: one in Sydney, the other in Melbourne. More retail locations will follow.

Cadillac sold 355,000 vehicles globally in 2023, which gave it a 3.0 percent share of the global luxury market.

MORE: Costco Australia wants to sell you a new car MORE: Why GM is continuing post-Holden revival with Cadillac

Content originally sourced from: CarExpert.com.au