How The Kelley Blue Book Works

Since its humble beginnings 75 years ago, the Kelley company has worked to bring value information for cars, recreational vehicles and motorcycles to buyers and sellers. Its Kelley Blue Book has become the standard automotive price guide for dealers and consumers alike. Now Kelley is using the Internet to make that information even more readily available. In this article, we'll explore Kelley's history, show you how to use its price guides and Web site, and explain where it gets pricing information.
Les Kelley never intended to start a publishing company. He began in 1918 by selling used cars, starting with three Model T Fords in a Los Angeles parking lot. With the help of his younger brother, Buster, Kelley turned his small lot into a thriving used car sales and repair business within a few years. Kelley began printing lists of used cars that he wanted to buy, including how much he would pay for them. He sent these lists to other dealers and banks. Before long, Kelley's lists were on the desk of every sales manager in the county and people came to rely on them for accurate appraisals of an old car's value. In 1926, Kelley published his list in book form for the first time. He named it after the Social Register, a list of the important and elite people in local society often referred to as the Blue Book.
The Kelley dealership continued to expand until it was the largest used car dealer in the country. The Blue Book increased in popularity as well, moving beyond its regional boundaries and becoming a nationwide car value guide for dealers. In 1962, the Kelley family sold off their dealerships and focused entirely on the Blue Book.
In the 1980s and 90s, Kelley started using computer software to track prices. In 1992, it offered dealers a computer program that allowed them to print out a label displaying the condition, mileage, and optional equipment on a used car. The label also included the Blue Book price and the Kelley Blue Book official seal. In 1993, the Blue Book was finally released as a consumer guide. The last major change in publication format came in 1995, when www.kbb.com was created.
Kelley Blue Book stayed in the Kelley family for three generations until 2000. That year, Bob Kelley (Buster's son) and his son Mike retired from the company, leaving it in the hands of new leaders who kept the famous name and worked hard to maintain the tradition of trustworthy and accurate information. Today Kelley employs around 200 people and has offices in Irvine, California and Detroit, Michigan.
Today, Kelley offers guides for new cars, used cars, older cars dating back to the 1940s, as well as motorcycles and recreational vehicles like motor homes and camping trailers. Much of this information is available free from the Kelley Blue Book.
Kelley only offers information on cars sold in the United States, so the same model of car sold in Canada might have some key differences that would alter the value. Kelley can still be used as a guide when a used car is sold in another country, but it does not account for regional market differences.
Most people are familiar with the consumer editions of the New Car and Used Car Guides, which can be purchased in almost any book store. These guides are published twice a year.
The Kelley Blue Book New Car Guide contains pricing information on cars for the current model year, including:
MSRP (Manufacturer's Suggested Retail Price)
the dealer's cost
any extra costs that may be involved, such as shipping the car
pricing schedules for various options that buyers can select
The Blue Book Used Car Guide contains information on the values of cars made in the last 15 years. This guide offers several different prices:
retail price - what you would expect to pay for this car at a used car dealership
trade-in price - what a dealer would offer you in trade value
private sale price - the price you could expect to get for this car if you sold it yourself to another person
The Used Car Guide offers charts and tables to calculate the price based on the condition of the car, the mileage, and optional components. It also describes how those factors influence the overall value of the car. Information on older used cars is presented in a separate book, while motorcycle and RV information is published separately as well. That information is only available in the guidebooks -- not on the Kelley Web site.
Using the books is easy. The cars are listed by manufacturer, then alphabetically by model. If you wanted to look up a Ford Explorer, you'd first go to the Ford section, then thumb through the "E"s until you found "Explorer." The book includes a "How to use this book" section that explains optional equipment and mileage.