Costco Travel, which has long been a thorn in the side of travel advisors, may be more expensive for its customers.
According to Senior Vice President Bob Nelson, who spoke during the company’s latest earnings call last month, after more than five years of fixed membership pricing, the clock may be ticking on increasing the cost of shopping and booking travel at Costco.
“Historically, we have raised fees every five to six years, with the last three increases coming in, on average, in a five-and-a-half year time frame, and the last increase coming in June” of 2017. “That makes late 2022,” Nelson said. It’s the next logical time Costco would increase membership prices if the company followed the same schedule as before.The last time Costco raised membership prices, in June 2017, it increased $5 and $10 depending on consumers’ membership level.
Nelson added that the team “has nothing more specific to report in terms of timing” and that announcing any increase now, with inflation rising, “is not the time.”
“Given the current macro environment, historically high inflation, and the burden on our members and all consumers in general, we believe that increasing membership fees today before our usual timing is not the time,” Nelson said.
However, if Costco follows its usual schedule, it may soon become more expensive to get a Costco membership and book vacations through the travel division, which, again, according to Nelson, is seeing huge consumer interest emerging from the pandemic.
“With everyone staying put for two years and not traveling, yes, this business has gone crazy,” he said.
Costco Travel, like a lot of industries during those early stages of COVID-19, struggled to keep up with the volume of customer calls as consumers tried to rebook or cancel vacations. The company’s travel division’s Twitter account has not been updated since March 2020, when customers took to social media to complain about seven-hour wait times and poor communications at the company’s call center.
Since then, the company has continued to attract vacationers, despite customer service complaints, due to its low prices – the travel division operates just like the rest of its offerings in that it offers pre-negotiated discounted rates to its members. And while you continue to beat some direct pricing and OTA pricing, there are more things to consider, even outside of customer service.
First, according to The Washington Post, those fares may not always be the best, especially for flights — one Costco member who spoke to The Washington Post said it was cheaper to book airline tickets separately, and another said that, even with the cost savings, they were able to upgrade The airline seats because they were bought as part of a package were negative for him.