Sunday, July 29, 2018

Brief Breakdown of Hobbies and the Trade War Tariffs

  1) Most manufacturers of both toy soldiers and model trains are inextricably locked into Chinese manufacturing.

2) The days of low prices for Chinese-made hobby goods ended about ten years ago.

3) A trade war with high tariffs on Chinese hobby goods (20% to 30%) will jack prices 25% to 35%. The extra 5%  is the cost of re-pricing, producing new price lists, additional customs costs, etc. Your $450 locomotive is going to cost $550 to $650. Your box of soldiers is going to go from $15 to $20.

3) Lionel Trains has started making some of its goods in North Carolina. Tim Mee is made in the USA. AIP has moved back to the USA. Hasbro is backing out of China.  MTH, Bachmann, RMT, BMC, LOD, and most of Lionel is made in China. While some production could be moved to Korea, it will still be a costly thing. Moving production will require retooling, setting up facilities, hiring and training staff, etc. That takes time and money.

4) Everything is going to be utter chaos until the dust settles.

5) Either way, you (the hobbyist) lose.

The manufacturers should have heeded a time-honored piece if advice:

Don’t put your eggs in one basket!

4 comments:

  1. To be honest Thor, I can't afford the new stuff now. Not sure what to expect now. I love the few hobby shops I frequent, but realistically my purchases have been limited to beginner sets, or used goods on Ebay. I have a fair amount of stuff on hand, but I don't foresee many further new purchases.

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    1. I haven't bought a new item in years, myself. Too expensive. The hobby is way too costly for most of us to buy new.

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  2. There is this upside: you find a greater variety of ways to use what you have. In my case, I've been reluctant until recently to import much, so bought a lot of stiff at club 'bring-n-buys' and took a pretty liberal attaude to munafacture and scales. I even scratch-built a few pieces of equipment and/or terrain pieces.

    These days I don't want for much, so can afford to be picky. I gather the US dollar is picking up (don't know how long that will last) but the NZ dollar has been tracking down against the greenback for several months now. So the average hobbyist in this country find himself also on a sticky wicket.

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  3. With the prices that they are now, I can't afford and won't even look into buying. When they first moved to China/Korea I said this is dumb, and now it's playing out I was correct. I'm expecting err to go up even more because of this. But it's what it is, I mainly now collect prewar/post war and go back to my skills of control from when I was younger. I just hope those that must have the newest have very deep pockets. Because of the trade war and the cost it has gotten to for stuff made over seas I hope it doesn't bring an end to the hobby, I hope Lionel, MTH, etc can find enough buyers to stay going, I understand the built to order but also feel it hurts them also, as I'm one that won't even entertain the idea of pre-order.

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