Orange Book Value MethodologyOrange Book Value is one of the most advanced algorithmic and data science based pricing engines to fetch the fair market price of any used automobile.
We have seen many pricing engines working on past transactional data in the world. Unlike these pricing engines, OBV uses empirical evidence and Droom's proprietary data science methodologies to evaluate the prices of used automobiles. The factors that go into evaluation in OBV includes make, model, year and variant of the vehicle, depreciation of the vehicle over the years, Odometer reading, purpose of the transaction (buy/ sell), party at the other end of the transaction (private party/ dealer) and condition of the vehicle.
For calculating the depreciation, we have plotted thousands of depreciation curves and mapped each vehicle to one of those depreciation curves. Party and purpose of the transaction also play a major role in determining the value of a vehicle. So, these factors increase or decrease the value of the vehicle obtained after depreciation depending upon the scenario.
Any automobile or for that matter any machinery, undergoes wear and tear depending upon the usage. When relating this to automobile terms, the kilometres the vehicle has run, captured through the odometer reading, helps in getting an understanding of the vehicle's condition which can then be factored into the valuation of the vehicle. The value obtained after this step will either increase or decrease based on the odometer reading. Anything in this world when maintained well, deserves credit and has a higher value. This holds well in case of used automobiles too. An automobile that is in excellent condition will command a higher value compared to a vehicle not in a good shape. For more details on how to determine the condition of the vehicle, refer to the section "How to Determine Condition" under "About OBV" in the footer section.