DI Good News/Bad News - MORE

[jereising]

From the DI web site:

December Update: We were very excited to finally get a shipping confirmation on our first run of Maxi-Stack IV well cars. Unfortunately, when the invoice came several days later the unit cost was 35% higher than expected due to inflation since the last time the quote was refreshed. We can only absorb part of this increase. The cost of all roadnames was the same, Pacer no longer needs to carry a premium price but we cannot sell the cars at $74.95 as announced earlier. It is with much regret that I am announcing the Maxi-IVs now carry a suggested retail price of $89.95 across the board for the first and second runs. The first run is expected here in the U.S. on January 10, 2015. The second run should be here 30 days later.

I'm just glad they're on the water!

[Scottl]

Honestly,I'm just happy to hear these are going to appear in stores soon.  Great news.

[Puddington]

I suspect many mfg's are suffering; or soon will suffer through this issue as prices in China and other locals go up at a steady and significant rate yet production times lag due to a lack of high quality capacity.... perfect storm..... (and if you're Canadian and your petro dollar has tanked to .86/USD yet your production costs are in USD then it it just that much harder....)

[Rossford Yard]

The simple math says they absorbed 15% of the difference and asked modelers to absorb 20%.  My guess at their profit margin is 15% and they seem willing to give that up to be fair to modelers and loyal customers.  I doubt you can ask for more than that from a good company, and hats off to them. 

You might say that they should have kept closer track of costs, but I do some business in China, and they are tough and sometimes unfair (by our standards) negotiators and business partners, so I can't even blame DI for that.  It is not uncommon for terms and prices to change suddenly in China.

[Jeff AKA St0rm]

If there profit margin is 15% then they would of been out of business. There Profit Margin is closer to 40% or more.

[bbussey]

... There Profit Margin is closer to 40% or more.

Really?  Including the all levels of discount structure for distributors and dealers?

[Denver Road Doug]

I'm just happy that DI has positive movement again.   If I was ignorant of the situation, I might be upset by the increase...but having pretty decent knowledge of the situation and DI's trials and tribulations over the past few years, I'm happy to pay it get a great product.

[nkalanaga]

Jeff:  Their MARKUP might be 40% (or it might not, I have no data), but that doesn't mean the PROFIT is 40%.  There's a big difference between the two.  A 40% markup may not be out of line, considering all of the costs between the container leaving port and the product reaching the consumer.  Also, the "suggested retail price", MSRP, isn't what the importer receives, unless the product is sold directly to the consumer.  The MSRP is what they expect the retailer to charge the consumer, so shipping to the retailer, retailer costs, and both the importer's and retailer's profits all have to come out of that markup.  In most businesses a 15% profit would be considered very good.

[jereising]

And the saga continues.  Thanks to Dave for this information on the DI site:

January Update: Will it ever end? The container with our Maxi-IVs is on a ship in port on the West Coast but due to a dockworkers strike it cannot be unloaded! All we can do is wait for the strike to be resolved.

[Atlas Paul]

And the saga continues.  Thanks to Dave for this information on the DI site:

January Update: Will it ever end? The container with our Maxi-IVs is on a ship in port on the West Coast but due to a dockworkers strike it cannot be unloaded! All we can do is wait for the strike to be resolved.

Just a point of clarification, there isn't a strike going on right now.  The contract expired, and the negotiations are ongoing, but the ports and the unions are playing games with each other, slowing down the process of unloading the ships.  This has been going on for 8-9 months already, but it is getting to the point where the ports are nearly gridlocked.  BNSF has actually embargoed west bound containers.

[Dave Schneider]

Just a point of clarification, there isn't a strike going on right now.  The contract expired, and the negotiations are ongoing, but the ports and the unions are playing games with each other, slowing down the process of unloading the ships.  This has been going on for 8-9 months already, but it is getting to the point where the ports are nearly gridlocked.  BNSF has actually embargoed west bound containers.

Luckily for those of us in Alaska, the dock workers and the ports have been giving priority to northbound shipments to AK. We are at the end of the food chain (so to speak) and highly dependent upon container shipments for basic necessities. Maybe all the model manufacturers should send their shipments to my house! I'll pass on what I don't need. 

Best wishes, Dave

[jereising]

The DI web site says the first two runs of the Maxi IV are shipping!  Won't be long now!

[Denver Road Doug]

Ugh, please don't let the production BNSF cars be as red as this photo...
http://deluxeinnovations.com/images/350201-BNSF-Sample-1200.jpg
Versus...
http://archive.trainpix.com/BNSF/RAILCARS/STACKCAR/211263.HTM

That DI pic looks frighteningly like BN America Red...       Hopefully it's just a bad photo.

[Glenn Poole]

There here!!!!! I just ordered a couple of them (BNSF red & TTX) Looks like the connection of the cars is the same as on their MAXI III.  If so, I will like that much better than Kato's.

[jereising]

I see BLW sold out (or never received) three of the four BNSF cars...MBK just showed them this afternoon.

Assuming these cars are as good as the Maxi IIIs, I'm gonna be a happy camper.  I sold off all my Katos, they tracked weirdly -  had problems when nothing else did.  And the detail level on these should put Kato to shame...