The Kelley Blue Book Guide – Info Sources
Kelley Blue Book: A Century of Trust
Ever heard of Kelley Blue Book (KBB)? If you haven’t, buckle up! This car pricing authority has been around since 1918. That’s over a century of helping people figure out what their cars are worth!
It all started with Les Kelley, who opened a car dealership in LA and began listing cars he wanted to buy from nearby dealers. Little did he know, this humble list would evolve into the Kelley Blue Book, the gold standard for vehicle pricing in the U.S.
No other pricing guide comes close to KBB’s depth and accuracy. Originally a tool for the insurance and banking industries, KBB helped lenders calculate car values and insurers understand replacement costs. It became so essential that during WWII, the U.S. government used it to set car price ceilings. Talk about street cred!
The Kelley Blue Book’s Evolution
Kelley Blue Book was a trade secret for dealerships until the 1990s. Then, in 1993, the consumer edition hit the market. And the rest, as they say, is history.
Today’s Car Market
Fast forward to today, and the U.S. car market is massive. With over 210 million cars on the road, it’s no wonder used cars are hot commodities. Here’s a quick snapshot:
Also Read: KELLEY BLUE BOOK USED CARS
- Used cars are bought 2.5 times more than new cars.
- A third of used cars come from private sales.
- Another third come from franchised dealerships.
- The final third come from independent dealerships.
- Over 17 million used cars are auctioned off annually.
How the Kelley Blue Book Affects Car Values
Unlike real estate, art, or sports equipment, cars depreciate quickly. They’re everyday tools, but they must meet safety standards to be sold. This is where KBB shines, offering accurate values by considering a car’s condition.
Where Does KBB Find Its Prices?
KBB doesn’t just pull numbers out of thin air. They gather data from multiple sources, including:
Franchised and Independent Dealers
Franchised dealers are tied to manufacturers, selling both new and used cars. Independent dealers, on the other hand, focus exclusively on used vehicles. KBB collects data from both to get a full market picture.
Wholesale Auctions
These are dealer-only events where cars are bought, sold, and traded. Rental agencies, financial institutions, manufacturers, and fleet owners participate, giving KBB a comprehensive view of the market.
Fleets and Rentals
Also Read: How Do I Use Kelley Blue Book To Determine The Value Of An ATV?
After a year of service, rental fleets often send cars to auctions. Sometimes they hold onto them longer, but eventually, these cars end up influencing market prices.
Financial Institutions
Banks own leased cars. When leases expire, these cars go to smaller financial institutions or auctions. Repossessed vehicles also enter this mix.
Original Equipment Manufacturers (OEMs)
Manufacturers like Ford and Honda auction off cars previously used by their employees. KBB tracks these transactions, too.
How is the Final Car Value Calculated?
KBB editors are like the Sherlock Holmes of car pricing. They analyze model histories, industry trends, seasonal changes, and economic conditions to produce values that reflect the current market.
What Kind of Values Can You Get from KBB?
KBB provides several types of car values:
- Private Party Values: Average prices paid when buying from a private seller.
- Trade-In Values: Cash you get when trading in your car at a dealership.
- Certified Pre-Owned Value (CPO): Prices for cars covered by a manufacturer’s CPO program.
- Fair Purchase Value: Actual selling prices based on thousands of registered sales across the U.S.
- Suggested Retail: Dealer’s asking price, serving as a starting point for negotiations.
Final Thoughts
KBB values aren’t just numbers; they’re your shield against getting ripped off. While they provide an excellent starting point, remember that factors like color, model, and location can affect prices. Always consider these when using KBB to gauge your car’s worth.
Ready to check out your car’s value? Visit the KBB official website and get started!
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