I’m just curious, but there has been several posts on the boards over the last few years from various people complaining or should I say “stating” that the cost of being in the Model RailRoader hobby is quite expensive and in some aspects I would have to agree; as I think many of you might. I’m not trying to rehash those posts in any way, we all know about it so there’s no sense in openning that old wound but I have a new question.
What I would like to know now is, do you think that the cost of our hobby will come down, as not only the US markets but the Global markets head into recession? And when do you think we will to see some kind of drop in prices of MRR items such as loco’s, freight, buildings, track…all of which are made of plastic that is directly related to petrolium prices in the making of said plastics. Or at least that was the excuses the industry was using when crude oil was pushing $147 a barrel. Does anyone else have high hopes that even though you may not have the money to purchase MRR items because of the recessions happening globally, that the prices for items in the hobby will eventually come down to normal levels? Whatever that may be?
What say you people? I’m curious to hear your thoughts on this.
I really do not see prices going down on model railroad items. You might see some inventory clearances by some dealers. It is true that petroleum is used in styrene plastic models, but if there is 50 cents of plastic in a train model I would be suprised. Fuel for transportation/manufacturing also weigh in here.
As the global economy falters, we will just see less new models arrive at our dealers. We do not need model trains to survive. I have never seen them listed as food/clothing /shelter type items.
Myself, if I lose my job before my planned retirement in 3 years; I will just have to ‘rough it’. At least my house is paid off, and I can start my defined pension at any time. The bright side is I have lots of ‘kits’ that need to be assembled!
Oh yeah the prices will be coming down. I am just waiting for the deals to pop up. It is possible that the companies could go the way of the Big 3 and hit congress up for some money however. [|(]
I guess a lot of this depends on what China decides to do. They may choose to support their manufacturing exports by keeping their currency artificially low, which many experts say it is, or they may simply let their export prices rise and concentrate on their internal economy.
As demand falls, we may see reduced production to stabilize prices, like we see in oil. Or, they may just cut costs by just producing more copies of existing models, but introducing fewer new ones.
My guess is we will see a stabilization of prices, but not much change either up or down.
I think that a serious problem was turned into a crisis by election-year politics and hysterical media attention. Suddenly, obscure banking terminology was on everyone’s mind, pounded into us every hour by both CNN and FOX. The fixes might have had more of a chance if consumers hadn’t gotten scared and crawled into their burrows, but now all measures of consumer confidence are down, and that’s one of the biggest things that drives the American economy. So, I’m urging each of us who does have a steady job and isn’t in trouble with his mortgage to take some of that money you’re saving on gasoline and heating oil right now and go down to your LHS and spend it. Get that locomotive, or that DCC system. It’s highly likely that your LHS is sweating this more than you are, and a bit of consumer confidence is what these shops need right now.
Probably not. I think some cost increases hadn’t been passed along yet as manufacturers/importers didn’t want to hike prices too fast. Other things like rising living standards overseas aren’t going to reverse easily. If things get a little worse, there will be some going out of business sales. But that’s only a one time opportunity and not healthy for the hobby long term.
I spent $168.00 this month on the hobby for 2 N Scale Atlas locos( on sale for 2/$89.00),a MRC Tech II power pack (like new $10.00),structures and several freight cars.I will be ordering more shortly.See I trying to help the failing economy.[angel]
Yes the price of the hobby has risen over the past few years but,thanks to the computer one can save mega bucks by simply shopping on line.
I use to be one that complain loudly about the higher prices till I seen it didn’t do any good so,I went the next step and beat the manufacturers at their own game by buying at discount.
No…The price bubble hasn’t burst yet nor will any time soon as long as there are modelers willing to fork over $149.99 for a plastic locomotive.Sorry,but,that’s a cold fact.
Bingo! Give this man a taller soapbox. Things will get better. But I don’t want to stray off topic…
On-topic…this hobby is a Depression baby, folks. It’s not going away.
What I would like to see more of is candle-lighting, instead of darkness-cursing. Why not come up with some new, cheap way to do something, and present it here, so we can all do it too? This hobby doesn’t have to be expensive. It really doesn’t. Of course, nobody wants to believe that, for whatever odd reason, but it’s true.
I agree. And if you want proof, just visit eBay. For many years buyers there have been forking over much more than they should on a variety of common MRR items. You can argue endlessly as to why, but the fact remains that it happens - and way too often.
Maybe there are too many rich people in this hobby? [:-^][:D]
If you do what I seem to end up doing( buying hoards of parts, kits & bits… then sit tight building them up…) I could see what others are saying but… The hobby will continue. After all the hoohah of the past 60+ years or so I don’t see any disappearance for this hobby…
Spending for our hobby wants (which are not NEEDS, in any economic model) is discretionary spending. You can’t eat or wear that latest 32-powered-driver, 2-smoke-unit, DCS ready offering from MTH, nor will it shelter you from the cold. The same is true of Atlas flex track.[:O]
That said, while we complain about how expensive everything is (especially when compared to 40 years ago) we will spend, up to the point where the budget yells, “STOP!” If we forego the trips to the Grand Canyon (no more steam [sigh]) or the nearest casino [}:)] we end up with an unplanned source of funds. Thus, the manufacturers and distributors have little incentive to lower prices.[|(]
Also, now that the election-year econobabble (mostly generated by people who have problems balancing their own checkbooks) has softened, I expect things to start climbing out of the hole they’ve dug and get back up to speed. Somehow, they always do.[^]
Chuck (modeling Central Japan in September, 1964 - behind schedule, under budget)
You will see more “blow-outs” as stuff that represents a lack of liquidity preys on the minds of shop owners who have to make ends meet. Other than that, what we pay for our models, even discounted at 40%, is still well above what the various pre-customer suppliers/retailers pay for the items themselves. There’s a healthy mark-up in MSRP in any hobby. So, don’t expect to see too many sales where things are flying off the shelves at 50% off or some such thing…won’t happen. Too many people are too keen and involved in the hobby, and well enough heeled and determined to stick to it.
Of all the posts so far, I’d have to say that Jim (jrbernier) is likely to be closest to foreseeing the truth about what is likely to happen in the near future. Certainly, the one thing you will not be seeing over the course of the next couple of years is a decrease in the price of any new major model railroad items. There remains a small minority of hobbyist willing to pay as much as is asked for new items and this is unlikely to change dramatically. At best, look for a leveling off of pricing at the current figures for things like locomotives, rolling stock and major structure kits. However, don’t be surprised to see things like track and operating systems increase further.
I think that you are going to see both increasing consolidation of the major compaines supplying RR items, as well as a number of the secondlevel manufacturers dropping out of the game altogether (including some current “big named but limited supply” locomotive importers). Look also for production runs to further decline in size to the absolute minimum. Likewise, a dramatic reduction in new offerings, to be replaced by re-runs and perhaps a further resurgence of the pre-order-only availability of any major items. The only obvious bright spot I foresee is a probable spike in major stock reduction sales at increased discounts and a flood of secondhand items on eBay and the like, as some folks try to recoup a measure of cash from their previous investment in the hobby.
It should be noted that, unlike during the Great Depression which spurred the hobby of model railroading, too few individuals today have the necessary skills to utilize everyday materials, nor have the inovative nature that once prevailed among hobbyists. Likewise, recall that the hobby 70 years ago was very small in size, with model railroaders in all the scales combined totalling fewer than 15,000 individuals. That’s probably about the same numbe
I second that! One of the great things about model railroading is that there is almost always some inexpensive, time consuming project to do. For me, it’s trees; I need a gazillion of them. I bought some foleage and trunks at a train show for less than half of a $20 bill, so I have the stuff to make over 100 trees. Because of the economy, my employer will furlough the entire workforce for the weeks of Thanksgiving, Christmas, and New Years Day. Guess what I’ll be doing a lot of those days? Yep, reforestation!
If I finish all those trees, I have about 100 unpainted HO people to paint (I may even get my girlfriend to help with those if I take her out to dinner).
Granted, LHSs need customers, but I can’t afford to be one of them. Besides the LHS, some ways to buy what you need are to shop smart. It’s amazing what you can find on eBay, Craigs List, and at train shows that are really good deals. Sure, you have to know enough not to spend more for used than new, or to buy broken-down junk*,* but if I had bought all of my train stuff new, I’d be into my layout 20 grand (if you include my brass locos), buying it all used/discounted got me there for about $3,500 (including the 14 brass locos).
For me, much of enjoying the hobby is in managing my layout like a real struggling railroad - shopping with a tight budget.
What I think will happen will be totally dependant on what credit terms are available to manufacturers, distributers and buyers. You see most model railroad stuff is made in the Far East and that trade is totally based on Letters of Credit. International trade flourishes with Letters of Credit because these gaurantee payment to the company that are the beneficiaries of such letters if the conditions specified in the LC are met. These terms usually include such terms as quantity of the items ordered, delivery to specified point and a requirement that the items be ewxactly what was ordered.
Now to get a Letter of Credit issued to a vendor, one has to have a credit line with am issuing bank or enough cash on hand to cover the letter of credit’s face amount. It is unlikely that a distributor has enough cash to do that so they need a bank or several banks to be willing to finance these deals. So in credit crunches, guess who suffers.
Now take it down to the next level, many buyers of anything like to pay with a credit card. Many issuers of these cards are curtailing the credit lines they offer to the card holders or they charge a very hefty interest rate or membership fee for the priviledge. So I suspect many credit card holders (even those who who aren’t maxed out) will be loathe to buy anything with them even when they pay off the outstanding balance each month.
So based on these realities, I see a bleak time ahead for everyone in this hobby.
The standard hobby ‘dealer’ discount is 40% (and 4% additional for paying the bill within 30 days). If the dealer can purchase in ‘jobber’ quantities(like some of the big on-line dealers), they can get an additional discount. Some special hobby items are sold to dealers at a ‘short’ discount(30 percent). A lot of craft items have a 50% or 100% markup! For a LHS to get a better discount, many times a jobber will have specials to clear out stale inventory. This usually happens on ‘seasonal’ items, and scale model trains usually are not in that catagory. Train sets/grass mats/foam tunnels many times are discounted after Christmas to clear them out.
The ‘blow out’ prices you see at train shows and web specials are usually manufacturer overstock. Life-Like was famous for this and there used to be lot of P2K E units and PA’s available for a very low price at train shows. There were a lot of deals 10 years ago, but the manufacturers have become more selective on the production runs. I see MB Klein does not do ‘pre-order’ anymore, and Toy Train Heaven is having ‘blow out’ sale emails every week - Usually on things I am not interested in!
If you have an job/income stream, there may be some ‘deals’ you are going to run into when a LHS fails. But for the most part, one can find decent on-line discounts on most model railroad items if they bother to look around. There are even some LHS that will ‘deal’ with you for cash or pre-payment.
I think the skills and ingenuity are out there, and they seem to be coming out more, lately. Necessity is the mother of invention, although it would be great to reach that level of invention without having to need it. Maybe the inventors are always inventing, but nobody really pays much heed until they need to.
It doesn’t take many people…it never did; pick up a few issues from any year from the beginning until now, and you see the same names over and over. All you need is one person to come up with an idea that all of us can copy.
(I do think we could learn a lot from those old-timers. I read old '30s Model Craftsman magazines all the time, and have gotten a lot of ideas there, but more than that, I’ve come to realize that 1935 wasn’t so long ago, and hobbyists then were like hobbyists now in more ways than we might think.)
As the government keeps spending money that we don’t have on bailouts, it seems to me that the value of the USD will continue to erode and the cost of imported models will go up. Then, maybe the art of scratch building will resurface. Peter Smith
Just a casual observation from my part of the world (northeast Atlanta suburbs), the LHS here has been absolutely packed with customers for the last 6 monts or so. Have never seen it so crowded before. Even the wife and kids have been commenting about how crowded the store is when we go in there on weekends. I started doing just browsing with the family on weekends to see what’s new and coming in on weekdays to do the “real” shopping, but now it’s even busy during weekdays. I realize this is just one store in one town. Jamie
I don’t see the prices going down either. The only forecast I have of MRR prices falling will go with quality as well. If you want something of good quality you will still pay through the nose for it. I think that a MRR company might offer something that is more affordable for the average consumer for someone to get started in the hobby, but it’ll still be life like or tyco quality. The good stuff will always be expensive. More and more competition (such as many manufacturers of decoders and such) will help drive prices down but I don’t think they’ll be significant
Let’s see, I’ve been involved in this for 2-3 yrs now. I’ve started mucking with scratchbuilding more from fiscal need than anything else however I’m now so fascinated by it that I ended up buying up a whole collection ( more scattered than anything else ) of RMC and MRR from the 40’s thru the 70’s for all kinds of ideas. This does make for a great time reading and challenging project mongering…
