Understanding how much your car is worth is vital when you want to sell it privately or trade it in at a dealership. Without knowing your car’s value, you risk expecting too much or selling it for far too little. That’s where Black Book values matter.
There are quite a few different evaluation resources out there, usually known as “books.” Each one of these books has its own unique method for evaluating how much a car is worth.
Today, we’re going to take a look at one of the gold standards for car dealerships: Black Book. While consumers are often familiar with a book of a different color (yes, we’re talking about you Blue Book), Black Book is often the one that dealers trust and use.
What is Black Book?
Founded in 1955, Black Book has grown and evolved every decade, but their mission has remained the same: To provide the most accurate car valuations out there.
Something that is unique about Black Book is that they charge a subscription fee, which means that their book values are typically only available to car dealerships and lenders. Why would you pay a fee to evaluate your car one time? That is a big reason why most consumers aren’t aware of Black Book (until they get to the dealership).
Black Book valuations are provided through many different mediums, most notably a weekly magazine that is circulated among approved sources, and in other formats, including their website and app. Car dealership solutions such as DealerTrack and Eleads integrate with Black Book to provide their sales staff with real-time Black Book values.
How Does Black Book Reach Its Value?
Black Book’s main method to evaluate cars is to visit over 60 auctions throughout the country every week to acquire information about used cars. Take note that these are wholesale auctions, which means that they are for dealers only.
Black Book’s data collectors physically visit auctions to obtain sales data, although they also seek data online. Their goal is to have information about every car sold at an auction in the entire country.
Just like other evaluation tools, Black Book has a proprietary algorithm for the way that they reach their total number for a car’s value. On Black Book’s website, they say that they have precise data that comes from “combining advanced capabilities of data scientists with the industry expertise of automotive analysts.” We like the way that sounds.
Black Book gives different values for wholesale, trade-in, private party, and retail transactions. Additionally, they have subsections based on the reported condition of the car. Just like other evaluators, they use as much data as possible about the target car to reach a value. This data is available for CarEdge members.
Are Black Book Values Accurate?
Since Black Book valuations are largely based on the selling price of used cars at a wholesale auction, Black Book tends to be accurate in its evaluations. Dealerships will undoubtedly use Black Book to determine how much your trade-in is worth. Black Book is typically more conservative than other book values. This is another reason why dealers typically rely on their values — it allows them to make more money when they sell the vehicle.
When Should I Use Black Book Values?
Black Book values were once only available for dealerships who paid the membership fee. However, we’ve integrated Black Book evaluations with our CarEdge member solutions. Now, you’ll be prepared for what a car dealership is likely going to offer you for your trade-in.
However, you should absolutely know about Black Book. Dealerships will run a report on your trade-in and use it to make you an offer on your car. Since Black Book is based largely on real sales, car dealers tend to think of their suggestion of value as the guaranteed sale price for your vehicle. That doesn’t mean that the negotiations need to end there. Instead, you should come back with your own information to get them to raise their offer price.
Before visiting the dealership, obtain estimates from other tools. Your most important negotiating tools will be actual offers from other dealerships. You can easily get a quote from Carvana, Vroom, and Carmax. Using these quotes to guide your negotiation process is a good way to secure a great deal. Additionally, CarEdge members now have access to Black Book valuations so that they know what to expect when they visit a car dealership.
Interested in learning how people come up with car values? You can learn more about other evaluation books here.