Will kit prices fall?

[Slash.Snakepit]

So...a few months ago I saw discussions on the surge of kit´s prices. I bought a Hasegawa Stratus for USD 16 something, and 14 days later it went up to more than 30 bucks.

Lots of people said correctly that the prices went up mostly because the oil price went up a lot...but looking at these graph provided by the New York Times shows clearly a huge drop:



Not to mention deflation all around the globe and the imminent recession...

Can we expect a fall in kit prices in the early future?

I hope so...

[dude2000]

Originally Posted by Slash.Snakepit

So...a few months ago I saw discussions on the surge of kit´s prices. I bought a Hasegawa Stratus for USD 16 something, and 14 days later it went up to more than 30 bucks.

Lots of people said correctly that the prices went up mostly because the oil price went up a lot...but looking at these graph provided by the New York Times shows clearly a huge drop:



Not to mention deflation all around the globe and the imminent recession...

Can we expect a fall in kit prices in the early future?

I hope so...

I would say yes because the variable direct cost (which is directly related to oil prices and its derivatives) will go down if oil prices keep going down. When? Depends on the inventories of raw material bought at high prices and how fast the manufacturer can process it into final product. However the financial crises will mean less consumer spend on items like kits which will mean less sales for the manufacturer and therefore marginal cost will increase for some time until it start to go down due to the price elasticity of such fixed cost to demand.

Now there are factors which may work in the other direction to oil prices going down. Tax on oil derivatives is a key factor, in fact exceed in importance price of crude oil itself, in setting the price to end consumer of these commodities. If governments keep or cut down the tax rate, the cost for consumers will go down, but if they increase the tax rate as a mean to fund the deficit that is knocking doors of global economies as a result of the global financial crises then we will see cost of variable direct material either remain at the same current levels or even go up...

[Slash.Snakepit]

Originally Posted by dude2000

Tax on oil derivatives is a key factor, in fact exceed in importance price of crude oil itself, in setting the price to end consumer of these commodities.

Good point!

[BVC500]

From, what I've noticed, the used market is down. For instance, Ferrari kit prices on eBay seem much lower. I paid $140 and $100 for Italeri's Ferrari 250 SWB GT and 275 NART in the past, but recently I bought another 250 for $60 and sold another 275 NART for $51. ,

[dude2000]

Originally Posted by BVC500

From, what I've noticed, the used market is down. For instance, Ferrari kit prices on eBay seem much lower. I paid $140 and $100 for Italeri's Ferrari 250 SWB GT and 275 NART in the past, but recently I bought another 250 for $60 and sold another 275 NART for $51. ,

Money is the best thing to keep during such hard times... sell off instead of keep them. Many people on eBay are speculators who want to make profit but now they feel the heat of the financial crises and they want to escape the boat. Good for genuine modelers and collectors.

[jano11]

Kit prices didn't go up because of the oil price and won't go down because of it either.
Plus the yen is always a stronger currency during crisis (and it actually went up by more than 20% during the last 2 weeks).
So I think we shouldn't dream about lower prices.

[jano11]

Originally Posted by dude2000

Money is the best thing to keep during such hard times... sell off instead of keep them. Many people on eBay are speculators who want to make profit but now they feel the heat of the financial crises and they want to escape the boat. Good for genuine modelers and collectors.

I'd rather invest money than keep it in such moments. There plenty of goods that are better bet than cash.