Kelley Blue Book is the largest vehicle valuation company in the U.S. They provide new and used car prices as well as prices for RVs, mobile homes, motorcycles, snowmobiles, and personal watercrafts. The Kelley Blue Book was first published in 1926 and has since become the standard price guide for consumers and dealers.
KBB has a one formula for estimating the value of new cars and another formula for estimating the value of used cars.
KBB Pricing for new cars:
They look at the MSRP, the dealer's cost, any extra costs that may be involved and pricing schedules for various options that buyers can select. Kelley's Data Collection division gathers information from thousands of transactions at dealerships across the U.S., analyzes the data, and comes up with a price that reflects the actual price that people pay when they buy their cars at a dealership.
KBB pricing for used cars:
Used car sales are harder to track, so KBB applies its 75 years of car appraisal experience to determine the prices. It starts with the value of the car when it was new and takes into account market forces that are in play at the time.
KBB prices are suggested prices only, they do not back their pricing valuations with any type of guarantee. In other words, it’s not carved in stone. The KBB value is a useful tool, but you are still free to negotiate further.
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