Born of the original restricted-circulation, dealer-only NADA guide of used car wholesale and retail values, the Blue Book has become one of the major merchandising devices of modern vehicle selling. From used car lots to new car dealers, they all claim to sell cars at or below Blue Book while buying your trade-in well above Blue Book!
What, actually, is a Blue Book? Who started this whole arbitrary pricing bible? How accurate are they and how do they get their numbers? Most importantly, do they provide truly valuable information to help you get the best deal, whether you're buying or selling new or used? Read on.
Although the real Blue Book goes by the brand name Kelley Blue Book (much like 'Kleenex' for tissues), the term has become generic for all vehicle pricing guides. There are three principal reference sources heading a wide array of vehicle pricing information available today through printed matter, the Internet, and a varied assortment of online communicators, including – of course – Autoblog.
Kelley Blue BookAs suggested by a KBB.com spokesman, "with 90 years of trust in providing the auto industry with data and several decades of providing car shoppers with valuable information, Kelley Blue Book's KBB.com allows consumers to become the experts on their purchase, helping fuel definitively smart auto choices with editorial reviews, pricing tools, consumer ratings and more." Notable, also, is the intuitive nature of the value search, and a trade-in range that seems more optimistic than that offered by Black Book. Kelley Blue Book, with more than 20 million unique visitors each month, promotes itself as offering the largest new and used car audience online."
Kelley Blue Book has historically collected its information by attending auctions throughout the country. It rates its used car evaluations as Excellent, Good, Fair and Poor. From those, Kelley Blue Book then sets wholesale values based on what are called 'front line' (as in 'traffic stopper') vehicles, which also includes costs for reconditioning, transportation and auction fees.
NADA Guide: The Yellow BookNow owned by J.D. Power & Associates (while still based in Northern Virginia), a spokesman for the NADA Guide supplied us with this overview:
"NADA Used Car Guide begins its valuation process with data collection, grouped generally into two categories: transactional data and market data. Transaction data gives us an indication of what vehicles are currently worth through several different sales channels. Market data also comes in through multiple sources and concerns economic factors that include fuel price, employment figures, interest rates and incentive data, among others. Analysis of market data gives us an idea of what the auto market will look like in the future.
Like other vehicle value providers, NADA Used Car Guide publishes different value types that represent values through different sales channels. Our retail values are intended to represent the sale price of a clean vehicle at a car dealer. Our rough, average, and clean Trade-In values are intended to represent typical prices of trade-ins at various conditions. We also publish a Loan value to help lenders establish a baseline amount of credit to extend on a vehicle purchase. All these value types are published monthly and with them we make every effort to reflect real price movement in the marketplace without including inherent random market volatility."
Black BookNow under the Hearst publishing umbrella, a Black Book spokesman offered this:
"Black Book® is best known in the automotive industry for providing timely, independent and accurate vehicle pricing information, and is available to industry-qualified users through online subscription products, mobile applications and licensing agreements. A leading provider since 1955, Black Book has continuously evolved to ensure that it achieves its goal of delivering mission-critical information to its customers, along with the data analytics necessary to successfully buy, sell, and lend. Black Book data is published daily by National Auto Research, a division of Hearst Business media, and the company maintains offices in Georgia, Florida, and Maryland as well as the Canadian Black Book in Toronto."
What Do the Pros Use?According to Lynn Faeth, referring to the used car operation of his nationally-noted The Scout Connection dealership in Fort Madison, Iowa, "I use the Kelley Blue Book and the Black Book for used car valuation. But the Black Book CPI (a guide for older, special interest vehicles – ed.) is my mainstay in determining the true value of any rare or unusual vehicle which I buy or sell."
Seconding Faeth's comment is John Gorton, the manager of Gerton Auto Sales, a large, successful used car enterprise in Mt. Vernon, Indiana, "I use the Black Book - the electronic version - exclusively in my operation, because its used car pricing seems to be more accurate and up to date."
"The system I use," added longtime Southern California car salesman Roger Himmel, "combines checking value of a trade-in or used car purchase in Kelley Blue Book and the NADA guide, then telephoning wholesalers or other dealers to see what the value is to them. After all, for everything I buy I must then find a buyer."
We took a look at two cars, a 2013 Subaru Crosstrek and '06 Jeep Grand Cherokee, to see how the guides compared. In establishing a value for the Subaru, a Premium trim 5-speed with 10,000 miles, Black Book supplied the low ball, suggesting a trade-in range of between $12,800 and $15,600. Black Book also required us to supply personal information, and while you could (obviously) make something up, we chose to provide the site with the real info; as we were doing so, however, we found it intrusive.
On that same Subaru, Kelley Blue Book gave us a range of between $17,777 and $19,100, while NADA was essentially an overlay, estimating our clean (exceptionally clean!) Subie was worth between $17,150 and almost $19K.
The Jeep narrative was somewhat similar, although given the older age of the Jeep and necessarily higher miles (100K) the range of estimates was more narrow. Here Black Book suggested a trade-in of between $5,500 and $8,215, NADA was hitting it at between $7,600 and $8,450, and KBB – using 'Excellent' in the condition report – hit the GC at between $5,500 and $7,685.
The bottom line as to which book to use is that there is no steady, set, fixed bottom line; they are all good, dependable, honest sources of information, some better than others for specific vehicles or markets or needs or purposes. When it comes to buying and/or selling a new or used vehicle, you might say the best method would be to use a combination of a used car classifieds search, your judgment and these sources as your own value guide, remembering that they are just guides.