[Gort]

Let me tap your brains.

I think the diecast industry will collapse. Maybe not today or tomorrow, but somewhere down the road.

Consider this ...

• Chinese diecast exports are faltering or are non-existent.

• Manufacturers (like Corgi and Dragon) are: 1) using less or no metal in their models; 2) employing more or all plastic in their models; 3) raising prices (in some cases dramatically); 4) canceling projected models; and/or 5) postponing deliveries.

• This could be due, in part, to: 1) distribution dilemmas; 2) Chinese crackdown on smoke-stack emissions (forcing factory closures); 3) shrunken profitability; 4) governmental angst over growing rice shortages and consequent peasant revolt, which could traumatize marginal industries like diecast; 5) rising zinc prices; 6) rising Chinese labor costs; 7) a weakened US Dollar that severely compromises consumer purchasing power; and/or 8) spiraling oil and gas prices, which force consumers to focalize on basic goods—not hobbies.

• The possibility that UPS, FedEx etc., will eventually raise shipping rates, forcing collectors to either abbreviate their purchases or abandon them altogether.

It’s a bleak scenario, I agree, but I believe this is the beginning of the end. I don’t want to see this happen anymore than you do; but if things get much worse, the Chinese diecast market could crash. Might be very close to that as we speak.

So I’m wondering, is my prognostication way off? Will the diecast industry survive, albeit a little thinner and a lot more expensive; or will world circumstances spin out of control and ruin the diecast market?

What’s your take?

[1250ships]

I don't necessarily agree with all of Gort's points but I do think we have been living in the golden age of diecast and that the end is near if not already here.

We will look back on what we bought the last few years and what we paid for it and be amazed.

[Folgore]

Disclaimer: Everything below is IMHO. Thankyou.

There's a proven market for diecast airplanes, and I don't think manufacturers / distributors will abandon that market entirely -- after all, there's money to be made. It's not hard to predict that there will be a shake-up in the industry -- it seems clear the shake-up has already begun -- but that's not unusual. Capitalism is creative destruction, right? The real change, I think, will be in how diecast airplane models are marketed. Up until now, they have largely been produced and mass-marketed as "toys." Upscale toys, but still. (Consider, for example, Corgi and Dragon.) Some of the newer diecast companies are starting to shift away from that paradigm, marketing finer models to a niche market: collectors like us. (Consider Gemini Aces and above all Century Wings. I'm not sure about Hobby Master. Still developing their strategy, maybe?)

The upshot: As manufacturing (definitely) and distribution (maybe) costs rise, so will the price of the li'l airplanes we know and love. As rising costs shrink the market, the models will be aimed at a niche, rather than mass, market. Production runs will shrink, further increasing the price-per-unit. Eventually a new stable price-point will be established (where the supply and demand lines meet on Ye Olde Supply-and-Demand Graph from Econ 101). We'll end up paying more for our models, and there may be fewer companies to choose from. On the other hand, as companies compete for our diecast dollars, and as manufacturing processes continue to improve, we'll see better models (more detailed, more options, etc.). That's been the trend, and I think this paradigm shift (away from diecast airplanes as toys and toward diecast airplanes as collectibles) will only encourage that trend to continue.

As a secondary shift, the trend toward vertical integration of diecast manufacturers / distributors (a la Hobby Master) will continue too.

The real question is: What will the new price point be? Century Wings and Carousel 1 airplanes go for about $60-$70, right? So will that be the new price point, or will it climb more? What's the upper limit? Sure, we'd buy fewer models at $75 a pop (for example), but if that price is enough to generate a profit at the numbers sold, that'd be the new price-point.

The toy industry as a whole will be affected by all the factors Gort enumerates (albeit to a somewhat lesser extent for toys produced in greater numbers -- economies of scale, doncha know). It'll be interesting to see what the toy section at the local Target looks like in five years. My guess: Slightly to somewhat higher prices and the end of the Made in China monopoly.

That's my two cents.

[PappyB]

My opinion: May hay while the sun is shining!

[Captain Eddie]

It may or may not get more expensive (probably will), but it will survive. If there is a market for it (there is!), the product will be made.

[skidmarksdiecast]

I believe Hobby Master, Century Wings & Gemini Jets/Aces will survive. I also believe that once the economic storm is over, those manufacturers who don't make it will be replaced by new ones. I also believe that manufacturing will shift from China to Vietnam.

[leeG]

Technology continues to move forward. Who knows, in the future we may buy our diecast as a CAD file and "print" them out at home on 3-D printers. It isn't much of a stretch to imagine rapid prototyping technology finding its way into the home.

I'm with PappyB on this. May hay while the sun is shining!