Chinese tariff war and models

[fumi]

3 hours ago, Rusty92 said:

Price increases might not affect the old fellas with “enough for a lifetime” but it sure does affect the new guys. Keep that in mind. Without people buying the new issues the hobby would be in a worse state of affairs.

They can always buy Japanese kits from aboard.

[Xingu]

Please remember to keep the discussion focused on how this impacts our hobby. Folks are starting outright political discussions and that will get the thread locked down. I have removed several posts recently.

[MeatMan]

2 hours ago, Xingu said:

Please remember to keep the discussion focused on how this impacts our hobby. Folks are starting outright political discussions and that will get the thread locked down. I have removed several posts recently.

Bravo!

[Rusty92]

8 hours ago, fumi said:

They can always buy Japanese kits from aboard.

Japanese kits do not always interest me. So eliminating options doesn’t really help either

[iamsuperdan]

8 hours ago, fumi said:

They can always buy Japanese kits from aboard.

True, but the Japanese manufacturers usually have a completely different subject matter than the US based companies. For those who love American muscle or old hot rods, kits from abroad are not an option.

[bobthehobbyguy]

Short term I think there will be increases which will affect sales. Hopefully when the dust settles the greed factor won't kick and and part of the tariff cost won't end up permanently.

For those of us who have enough kits to build for several millenia might be a time to reduce the kit stash.

For those  without a lot of kits more time detailing might be a way to extend the modeling experience.

Also might be the time to explore doing some scratchbuilding.

Edited May 17, 2019 by bobthehobbyguy
Additional comment.

[Bugatti Fan]

Holy broken bones Batman! You will soon be paying similar prices to Europeans for your kits!

Joking aside, Ebay and second hand sales at model shows should keep most of us happy if things get a bit expensive.

Can't remember the last time I actually bought a new kit!

Now what happened to that Bogwart 500 Deluxe Convertible that I had in my stash?

Edited May 17, 2019 by Bugatti Fan

[misterNNL]

Possibly the description of the item under which they are imported could be changed. My friend of mine from Canada told me that when he visits toy shows in the states and buys model kits he declares them as "kits" at customs on re-entry to Canada. That description will not cause customs to charge you any import tax. For some reason some folks from there call kits "sets" and declaring them "sets" will cause customs ding you for a 30 percent (!) import tax at the border. Our readers from north of the border might want to keep that in mind in the future.

[Craig Irwin]

Kits seem to be going up in price $3 or $4 every year anyway, If Chinese goods become too costly the model companys will just move the tooling somewhere else where the labor is cheaper.  12 year olds doing slave like labor are worldwide. That is if the Chinese government doesn't seize it.

Edited May 27, 2019 by Craig Irwin

[Bill Eh?]

Craig, I agree with you about the constant price hikes that seem to regularly occur now. "...model companys will just move the tooling somewhere else...", this is the part that can become problematic in terms of how China views property rights. LOL

Edited May 27, 2019 by Bill Eh?

[oldnslow]

I think they ( the model companies ) could learn a valuable lesson reviewing what happened to Franklin Mint . 

[Mr. Metallic]

21 hours ago, Craig Irwin said:

Kits seem to be going up in price $3 or $4 every year anyway, If Chinese goods become too costly the model companys will just move the tooling somewhere else where the labor is cheaper.  12 year olds doing slave like labor are worldwide. That is if the Chinese government doesn't seize it.

Apparent;y, it's just not that simple when dealing with the Chinese government. You can't just "move the tooling somewhere else". 

I speak from experience. The company I work for has gone through similar scenarios, with injection molded and cast metal parts. They have had to cut new tooling for parts formerly sourced from China to have the parts produced in the US. 

[bobthehobbyguy]

I worked for a company that did large format printers and plotters. Any order to China was a huge pain becuase 8f the paperwork. If we sent printers for trade shows had to have a buyer. Its was very difficult to get anything out of China.

Any model tooling isn't going to leave China. If its recent the files could be used to recreate the toolong else where. But if the tooling was created from wood masters then that not going to work. 

[robertw]

I'm concerned for the small hobby shops. The costs from tariffs will of course be passed on to the consumer and the higher the prices the more reluctant many will be to buy. Almost everyday we hear about another hobby shop going down will they be able to handle a prolonged period of hyper high prices. Here in Canada Revell/Round2 kits are already in the $40 range with Tamiya kits in the $60+ range. Already I don't buy as many kits as I once did so adding 25-30% on these prices night become the breaking point. Because of shipping regulations most of us here rely on the hobby shop for paint and other chemical supplies and I am aware of a couple of shops that I deal with now that are having a tough go of it. I hope this proves to be unnecessary speculation.

 

 

 

 

 

 

[Richard Bartrop]

I hear you about prices up here, and when it gets to that level that kit had better be something I really want.  I suppose it a lot will depend on whether tarrifs on products going into the US will have an effect up here in the Great White North.

[mikemodeler]

Was at Hobby Lobby today, shocked to see the current Revell 57 Chevy Snap Fast kit, which has been around for years, in new box art with a price of $22.99. Yes, 40% off will work, so the kit becomes $13.79 plus tax, but considering it's shelf price has go over the $20 mark, what does that mean for the rest of kits? The AMT Coca Cola 57 Chevy Cameo is $32.99 and you can bet that increase is due to licensing fees.

 

It would be nice to have someone from a hobby distributor or manufacturer chime in and let us know what they are seeing as possible price increases.

 

At this rate, I might be better off NOT selling any more kits, I might need them to build if I can't afford to buy new releases.

[fumi]

On 28/5/2019 at 9:17 AM, oldnslow said:

I think they ( the model companies ) could learn a valuable lesson reviewing what happened to Franklin Mint . 

Is there any concrete evidence that "Red China" seized Danbury Mint's tooling other than some vague statement in a mailing list and innuendos on some forum that are being regurgitated all the time?

The official statement from Danbury Mint was that their primary sub-contractor closed in 2012 and their secondary sub-contractor also closed in 2014, and they were no longer able to cost effectively produce diecast model cars.  At the time the $200 diecast market had all but collapsed and the cheap labour in China who was willing to move all the way to the southern provinces to work for minimun wage had vanished.  Pulling out of the diecast market was a logical move for Danbury Mint.

[Xingu]

Please keep this thread on topic.

[oldnslow]

"Red China" didn't seize anything , according to the report I read , their contractor wasn't paying his taxes and the government seized the company and all it's assets . Since American companies have no standing in Chinese courts , Franklin Mint lost all the tooling in the process , of course they said it was a business decision , they didn't want to look like fools to their stock holders , but they did anyway . There's no way they just walked away from millions of dollars of tooling because the market was down .

[Tom Geiger]

5 hours ago, fumi said:

  At the time the $200 diecast market had all but collapsed and the cheap labour in China who was willing to move all the way to the southern provinces to work for minimun wage had vanished.  Pulling out of the diecast market was a logical move for Danbury Mint.

Every country has it's moment as that "low cost provider".  First it was Japan,  then Korea and now China.  Then they become prosperous and their citizens get a taste for consumer goods. Costs go up and they are no longer low cost.

If indeed these tariffs are put into place and become permanent, there are other countries who would be happy to become the low cost provider for this coming era.  Note that Revell already sources in Poland, I'm sure they have other opportunities in Eastern Europe.  There's certainly the skill there.

Moebius spokesman Dave was quoted as saying there is currently no turnkey vendor in the USA who can provide the process from design to shrink wrapped boxes.  There's nothing stopping a company from developing those services if there is a market.

And other places like  Viet Nam and Laos have become exporters to the USA.  We will see.

[mikemodeler]

11 hours ago, mikemodeler said:

 

 

It would be nice to have someone from a hobby distributor or manufacturer chime in and let us know what they are seeing as possible price increases.

 

 

Lot's of speculation but nothing really substantial from people who work in the model industry, hopefully someone will chime in with facts and useful information.

[Greg Myers]

I used to wonder the effects of the oil shortages / embargoes. Plastic being made from petroleum, surely there would be an effect. Seeing cheep plastic BLAH_BLAH_BLAH_BLAH in stores also bothered me, wasting precious plastic that could be used to make model kits.

[Tom Geiger]

On 5/29/2019 at 9:40 AM, mikemodeler said:

Lot's of speculation but nothing really substantial from people who work in the model industry, hopefully someone will chime in with facts and useful information.

I don't think they have any more information than we do.  Right now it's just threats and political posturing.  

[mikemodeler]

10 hours ago, Tom Geiger said:

I don't think they have any more information than we do.  Right now it's just threats and political posturing.  

I will have to disagree Tom. I work for a manufacturing company and I can tell you situations like the one going on with tariffs get the attention and accountants are tasked to provide what different scenarios will impact the operation. 

They might not want to sound the alarm, but companies who rely on product from a foreign country monitor these situations very closely.

[Tom Geiger]

5 minutes ago, mikemodeler said:

I will have to disagree Tom. I work for a manufacturing company and I can tell you situations like the one going on with tariffs get the attention and accountants are tasked to provide what different scenarios will impact the operation. 

They might not want to sound the alarm, but companies who rely on product from a foreign country monitor these situations very closely.

Mike, you are correct for large companies who import a lot of product.  I'm sure Walmart home office is in a tizzy.

In fact, back in the last century, I managed office space for Nabisco... I used find it interesting how Planters division monitored nut prices in real time.  They had a situation room where they analyzed what they were paying for each type of nut that day, and the mix they would put in the cans of mixed nuts as a result.  Get a jar with a lot of Brazil nuts?  They were cheap that day!

My point is about the model car companies... these are very small entities, handful of people.  In fact I've met most of them.  They don't have the resources to know much more than we do. 

Edited June 1, 2019 by Tom Geiger