If you’ve ever tried to buy or sell a used vehicle, chances are you have some familiarity with the Kelley Blue Book. Supposedly the Kelley Blue Book is the holy grail of what vehicles are really worth, so paying “under Blue Book” is a real steal and charging “above Blue Book” is a fool’s errand. Right? Well as it turns out things aren’t as simple as that. To understand more about a used car’s value, it’s important to understand where Kelley Blue Book gets their values from.
It’s rare that a dealership will match the Blue Book value on a trade-in, but this does not necessarily mean that the dealership is trying to rip you off. Dealerships tend to be more interested in the Black Book, or NADA price guides which are less focused on the potential worth of a vehicle, and more focused on a realistic selling price. And as always, price can fluctuate wildly based on the condition of the vehicle. For example, a vehicle that has always had a set of custom floor mats and has regularly gone in for oil changes is likely to be in much better shape than a vehicle that hasn’t.
The Blue Book value on the other hand, is less interested in high volume buyers and sellers and while the exact algorithms are confidential, we do know that the data comes from public auctions, independent and franchised dealers, and rental and fleet sales. You’ll notice that the nearly one third of vehicles sold by private individuals do not get taken into account.
There are simply too many variables at play when two private parties agree to transfer ownership of a vehicle. The two parties may be friends or family, neither party is likely to test the current safety standards of the vehicle, and an individual is more likely to consider add-ons such as a make and model specific tonneau cover or other aftermarket modifications that may add value to the final sale.
In short, Blue Book values can help give you a ballpark estimate, and you should take a look whenever you plan to buy or sell a used car. But take them with a grain of salt, and remember the value of a used car always depends on how well the particular car has been maintained.