What Is a Blue Book?
You might know it as the Blue Book or Kelley Blue Book—it's essentially a guidebook that lists prices for new and used cars, trucks, and other vehicles from every make, model, and type. I remember it started back in 1926 when Los Angeles car dealer Les Kelley put it together, and at first, it was just for industry insiders. But in the 1990s, they released a consumer version and an online one, so now anyone can access it. What it does is give you a fair market range—that's an estimated spread of prices people actually pay for a specific vehicle, factoring in the make, model, style, and year.
Understanding the Blue Book
The Blue Book has established itself as the go-to appraisal guide for vehicle prices across North America. If you're selling or buying a car, you'll turn to it to figure out the resale value of used vehicles. It even provides an actual cash value, which comes in handy if your car gets wrecked—you can use it to verify what your insurance company says and maybe negotiate a better payout.
Specifically, it breaks down values like private party value, trade-in value, suggested retail value, and certified pre-owned (CPO) value for used cars. For new cars, it shows what buyers are currently paying in the market.
Fast Fact
Over the years, they've expanded the Blue Book pricing guides to cover more than just cars—you can find them for motorcycles, travel trailers, campers, ATVs, snowmobiles, and even manufactured housing.
How Blue Books Are Used
When you use a Blue Book, it shows you what others have paid for similar vehicles—the fair purchase price for the same make, model, year, with comparable mileage and usage. Beyond that, it can outline expected costs for owning the vehicle, including fuel, maintenance, repairs, insurance, and financing. It also projects depreciation, so you can estimate what it'll cost to own it over the next five years.
How the Blue Book Determines Car Prices
The fair purchase price in the Blue Book reflects what consumers typically pay for that vehicle, adjusted for the region based on new-vehicle sales data from around the country. They update these prices regularly to keep up with market shifts.
It doesn't list the absolute lowest prices out there; instead, it gives the current going rate. They compile this by collecting data on thousands of actual consumer purchases, plus info from national vehicle registration databases. Every week, Kelley Blue Book reviews all this aggregate data and applies a proprietary algorithm that considers pricing info, historical trends, location, season, and economic factors to produce the value ranges you see.
Special Considerations
This guide comes from the Kelley Blue Book Company, which got bought by AutoTrader.com and Cox Automotive—don't mix it up with other 'blue books' like the Social Security one that lists disabilities.
Besides the Blue Book, you have other options for researching car prices. J.D. Power and Consumer Reports provide data on new car prices, used car values, and vehicle history reports. If you're financing with a loan, consider using an auto loan calculator to run the numbers.
Key Takeaways
- The Blue Book, or Kelley Blue Book, is a widely trusted source for automotive price quotes in North America.
- It reveals what prices people have paid for vehicles matching the same make, model, year, mileage, and condition.
- The guide covers private party value, trade-in value, suggested retail value, certified pre-owned value, and more for used cars.
- It also assists in estimating future ownership costs like fuel, maintenance, repairs, and insurance.
