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Thread: Athearn's Latest Price Increases: Im out...

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    Quote Originally Posted by MGWSY View Post
    Wow $49 for a car that was $30 5 years ago. I doubt labor costs and oil prices justify a $19 price increase per car! I understand Plastic is made from oil and shipping/labor prices went up but we are talking a total of less then a $1 per model when all is said and done and they jack the price up $19! WTF. I bet Athearn is just doing it to see what the market will accept. if they dont sell many then they will lower the price but expect to see more of this.
    I can speak firsthand at how the cars are NOT selling. My LHS likes to sweep up the half-off stuff at Horizon. He brings in a TON of stock every few weeks. The cars are NOT selling very well. The guy who owns my LHS knows that no one wants to pay the outrageous prices, which is why he usually only brings in the stuff on clearance (it's all good stuff! I end up dropping 100-500 there every few months and pick up a whole fleet of cars there). Covered cement hoppers for $11.49 anyone? How about LPG tank cars (new tooling) for $15.49? (all half off MSRP)

    The things that are almost guarenteed to sell at this point is locomotives. Regardless of how much they gouge the prices, people will buy them. Of course, there are people who find ways around paying full price for stuff, but because of a higher MSRP and limited quantities, the locomotives hold their resale value very well even when used.

    Those Atlas GP40-2Ws... I bought one for $118 with free shipping when they came out. To this day, I have not found another one at that price or better, and I generally don't pay more than $100 for a non-sound locomotive unless it's something I really want.

    These manufacturers need to learn the laws of supply and demand. Jacking up the prices will murder the demand.

    Case and point of someone who's doing it right:

    The Dash 8-40CWs for Norfolk Southern's horsehead paint scheme retailed for $140. They're nearly impossible to find at this point, and I just paid $150 for one on ebay, USED.

    I have no doubts that Atlas will make more in the future, but just not in the same road numbers. Atlas releases products slower, which builds up demand, which makes it easier for them to sell their products at a slightly higher price.

    Athearn on the other hand, pumps out all this stuff that they can't even deliver on time, with quality control problems. They're not exactly creating a demand, they're flooding the market. If Athearn comes out with a 50 foot box car, and then some tank cars, both costing $30-40 a piece with the same old tooling, people with limited budgets won't buy both, they'll buy one or the other. So, the demand decreases. Since the demand decreased, I bet Athearn is gouging the prices to make up for the losses, further destroying what little demand there is left for their products.

    With the prices on new stuff skyrocketing, existing model railroaders will tend to buy older stock and/or used stuff. When a model railroader buys used stuff, or old stock from their LHS, Athearn (or any other manufacturer) is NOT making money from that item. For example, Modeler A buys an Athearn Dash 9 brand new. Athearn made their money on it from his purchase. Modeler A gets some play value out of it. Modeler A decides that he doesn't want his Dash 9 anymore for some reason and puts it up for sale. I see the prices on a brand new Athearn Dash 9 and don't want to spend that much money on one even with a discount. I see Modeler A's Dash 9 for sale as used. Modeler A kept his locomotive in good condition and didn't damage anything so I buy it because the used price is better than the price Athearn has them at right now. I buy Modeler A's Dash 9, and I get to play with it. Athearn doesn't make any money from that exchange, and technically LOSES money because I didn't buy a new Dash 9 for them to profit on.

    Same concept with the old stock at the LHS. When the store ordered the locomotive or rolling stock in the first place, Athearn has made their money. After sitting on the shelf for 2 years, a customer comes along and buys it at a reduced price because the store wants to get rid of it. Athearn loses a sale because the customer saw the price tag on the older stock and decided to buy that instead of something new. Because of shelf queens like that item, the store may also cut down on the stuff that they actually order from the distributor/manufacturer, which leads to even less sales for the manufacturer.

    Some of the manufacturers in this hobby are digging their own grave!

    Don't get me wrong. ALL of the manufacturers have been experiencing quality control problems lately. The only difference is that Athearn has had the quality control problems from day 1 and never fixed it, so it has progressively gotten worse.

    Back to the half price cars at the LHS... There are two scenarios. If Athearn can afford to sell the cars at half price and break even or even make a little profit on the cars, then they're gouging the MSRPs to make an unreasonable profit. If Athearn loses money selling at half price, then they seriously need to rethink their business structure.

    I'm inclined to believe it's the first scenario.

    Walthers is another repeat offender. I was at the LHS yesterday. The shop's co-owner was unpacking a box from Walthers. More than half of the cars either had ends popping off due to shoddy construction or wheels/trucks popped off the model. He knew how to fix them, but Walthers is one of those companies that cares more about lining their bank account rather than the modeler. They're jacking up the prices to $35-$40 on cars that have NOT been retooled, and are simply built-up kits. To save on shipping, they also don't put adequate weight in their cars.

    I've realized something... Athearn (Horizon) and Walthers are both large corporate entities. Atlas is not. I think that when the companies get too big, the customer gets screwed with poor quality and bad customer service. For example, McDonalds, Wal*Mart, Best Buy....
    Last edited by diburning; 12-23-2011 at 10:56 PM.
    Eric from Boston, MA. Modeling Norfolk Southern and Pan Am Railways.

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    $50 for one car, and a 2-bay cement hopper at that? Sorry, no. Of course, there will be discounts, but still...

  3. Default Dying hobby?

    Athearn BB "shake the box" kits were great introduction into the hobby. 55' twin bay hopper could be had for under $4. Build the basic kit, good enough.
    Want to go to the next level? Add Kadee #5s, maybe washers under the trucks to get the correct coupler height.
    Still more? Replace the plastic wheels with metal wheel sets. Scrape of the molded on ladders with a #11 xacto blade and install brass ones. Same with the roof walks, stir-ups and brake details.
    Graduate to buying plain old undecorated black plastic cars then detail, paint, decal, weather.

    If the basic stuff to create even a small layout costs to much then the manufacturers have outpriced the young consumers that will make the market continue to thrive long after us geezers are in pine boxes.

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    I am the same way on most of the Athearn now built. I will look for clearence sales and resales on the various sites. Brand new, no way!!!!

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    Ok, I just spent $9.00 for a Intermountain hopper kit. It was assembled while watching football on Sunday. For those of us who don't mind assembling kits, they are the way to go. Obviously, more modelers wanted all of these details and ready to roll than us oldtimers who don't mind placing the correct detail parts on their rolling stock. And yes $49.00 is way to much for a car. 30-40 years ago that was the price of a new engine. Phil

  6. #36

    Default

    Quote Originally Posted by diburning View Post
    I've realized something... Athearn (Horizon) and Walthers are both large corporate entities. Atlas is not. I think that when the companies get too big, the customer gets screwed with poor quality and bad customer service. For example, McDonalds, Wal*Mart, Best Buy....
    Walthers is a family owned business, not a large corporate entity.

    Much of what we see on pricing is a result of troubles with Chinese vendors. China raised their minimum wage twice in 2011. Maybe we'll see some of this stuff come back to the US as a result of this, or maybe they'll find third world countries where the labor rate can be kept low. The sucky economy may also have something to do with why things aren't selling. Those of us who remember twenty five dollar locos and four dollar freight car kits may not like the pricing trend, but look where everything else is. Index it for inflation, do the legwork. The pricing is what it is. Wanna play? You gotta pay. If not, there is always the swap meet.
    Alan

    Modeling Espee on the Coast and in steam

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    Regardless, walthers has gotten too large to the point where the modeler is no longer the priority. The customer service blows, and walthers has been cutting corners from day 1. Their cars are underweight so that they can save on shipping, and theyve been raising prices on their built up kit cars while athearn is upgrading the tooling for theirs to have wire grabs, etched metal roofwalks, etc.

    I know that manufacturing costs are going up, but other manufacturers such as atlas and intermountain are not raising the prices by 50%+ with every run.
    Last edited by diburning; 12-24-2011 at 09:16 AM.
    Eric from Boston, MA. Modeling Norfolk Southern and Pan Am Railways.

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    One may moan and complain loud and long about prices, the manufacturers and Chinese production, but the problem hobbyists face today is one that has been brought upon them by themselves, not some outside agency. Model railroading originated as and continued up until the mid 1990's to be a hobby based almost exclusively on actual hands-on modeling and personal skills development. The products offered by the manufacturers addressed the needs of such a hobby and therefore were for the most part quite modestly priced. The hobbyist took pride in what HE could create from a simple kit and many turned their Athearn BB kits into models that rivaled and exceeded today's $50 RTR cars and $400 locomotives.

    Today's approach to the hobby is much more in line simply with the purchasing of and the playing with RTR miniature trains that require zero input and effort from the hobbyist beyond opening his wallet. Any remaining craftsman aspect to the hobby, nowadays largely limited to some modest degree of scenicking, is rapidly diminishing and will likely all but disappear before the conclusion of this decade as the hobby transforms totally to RTR. In the process the scale hobby will essentially merge with the Lionel/Flyer toy train hobby.

    Were it not for the fact that the direction of the hobby altered so dramatically in recent years, then we would still be able to purchase items of all sorts at a fraction of today's prices. So, if blame is to be placed on anyone, we should accept it as our own.

    NYW&B
    Last edited by NYW&B; 12-24-2011 at 10:31 AM.

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    Regardless of whether the hobby went in the direction of RTR or kits, manufacturing costs would still go up, and the manufacturers would still gouge the prices.

    Instead of paying $50 for a RTR car, you'd be paying $30 for a kit.
    Eric from Boston, MA. Modeling Norfolk Southern and Pan Am Railways.

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    Another factor that folks don't really recognize is that the U.S. dollar is worth about 9 cents compared to what it was in the 1960's! Add to that the changes in U.S. and world economics, and the change in the market of the hobbiests, and this is what we face in prices.

    Anyway, Merry Christmas, everyone!

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