Kelley and NADA are what we typically use to estimate trade value. Kelley ICO is the best because it is the most detailed – no two used cars are the same, and in the ICO form you can put in a great deal of detail, especially damage and aftermarket parts.
But those are book values, and even stalwarts like Kelley and NADA can miss on a car’s value. The true value is dictated by the market – and they don’t always have all the data.
We price low when we sell the cars, and that is taken into account as well. Some dealers price high and give more for trades. But not everyone is trading a vehicle, so to us it’s better to set low prices on everything we sell, relative to market. If you are trading, and you want to find the best deal, pick the place giving you the lowest result when you subtract trade offer from the price of the car you are buying. So many people get caught up on the trade offer alone (I want retail for my trade! uh, no.) – also consider the discount you receive on the car you are buying.
To justify the prices of the cars we are selling, we use proprietary software which lists the prices of all similar vehicles (year, model, trim level) within 200, 500, a thousand miles of our dealership. They can be ranked by price or, more important imo, value (taking price and miles into account). We show these lists to people who think our price is too high. “See – we’re value-ranked #5 in the Midwest out of 77 similar cars. It’s a very good price.”
Because we sell some relatively rare sports/luxury cars, we do some long distance sales which require shipping. And let me tell you, we try very hard to show every little blemish on a car to the long distance buyer, because nobody likes bad surprises… but it still happens occasionally, despite thorough walkaround vids and photos, there’s some scratch we failed to show them. It can be a headache. I wouldn’t want to work in Carvana’s customer service debit. It’s hard to ascertain the true condition of a vehicle through photos alone.
But the reason, or a large reason, that used cars are less likely to gouge you than new cars, in this climate, is (aside from greater used car supply than new car supply, relative to normal conditions) that everyone has access to Kelley and NaDA – they can get a pretty good idea of a used car’s retail value. And if you charge above that, you have a fight on your hands unless the proprietary market data supports it – and even then some think we’re just making it up.
“Kelley says it should be $24500!”
“Well, Kelley doesn’t always reflect the market. As you can see, in the Midwest we’re #3 on price at $25000, and #1 in value.”
My husband has a “slow” Tesla. Every time he rents a car or drives our truck, his first comment is “not a Tesla”. Lol. Bet he can’t wait for Hertz’s new fleet.
Depends on our ages, I suppose. I wasn’t around when the Model T was raced. 
