Black Book vs Kelley Blue Book vs NADA guides
Ask any used car dealer what the most accurate guidebook is and you will likely get very different answers depending on what part of the country you are located in. Kelley Blue Book is heavily used on the West Coast, Black Book in the Southeast, and NADA is more widespread nationally due to its heavy dependency on financial institutions in regard to loan originations. Most dealers choose more than one guidebook when appraising in order to make the most informed decision for their investments.
According to its website, “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 is exclusively geared towards dealers, wholesale buyers, and lenders, whether it is by website, smartphone application, or 3rd party integrations. Their data is not offered to consumers. For that reason, car buyers are not typically familiar with Black Book values and they may not trust a Black Book driven appraisal at a dealership. However, when dealers are purchasing vehicles at auction (for inventory), Black Book’s WHOLESALE data is second-to-none.
Kelley Blue Book was founded in 1926 and is the most recognizable guide to consumers and car buyers. For that reason, it would be wise for a dealership to at least consider KBB’s RETAIL, TRADE-IN, and FAIR PURCHASE PRICE values on each vehicle they appraise. On the West Coast, many financial institutions use Kelley Blue Book’s WHOLESALE LENDING value as the standard of what to loan on a particular vehicle. In many cases, in order for these institutions to even begin the loan process, they must have a document showing KBB’s WHOLESALE LENDING and RETAIL values. Coupling the strong consumer presence of KBB’s data with a wholesale value, such as Black Book, for example, is a recipe for a dependable vehicle appraisal.
Finally, NADA (J.D. Power Valuation Services) began in 1933 and has since been an industry leader in supplying LOAN and TRADE-IN values (among others) to dealers across the country. They also offer a consumer website that establishes transparency in the industry. NADA guides were the first to publish a LOAN value that helps lenders establish a baseline amount of credit to extend on a vehicle transaction. And since most lenders use NADA, dealers tend to follow suit.
The bottom line is that there is no “perfect” guidebook or process for appraising a used vehicle. Instead, Laser Appraiser enables dealerships with the perfect combination of appraisal and valuation tools, empowering the buyer for wholesaling used cars for maximum Return on Investment (RoI).