Author Topic: Where is the tipping point?  (Read 1877 times)

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Puddington

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Where is the tipping point?
« on: December 28, 2014, 09:25:20 AM »
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When I started in N scale RTR "detail" was considered having a movable door on a boxcar; today it seems there is no end to the amount of detail that can be included on RTR N scale models.

No one can argue that there needed to be and has been a ever increasing standard for acceptable N scale RTR models; even in the "train set" category. A quick glance at the RTR freight car market sees far better body moulding and factory applied details, free standing ladders and grabs, metal stirrups, etched metal brake wheels and running boards, all metal wheel sets, body mounted MT couplers and prototypical ride height becoming common elements. Similarily, power has improved with detail, unit specific factory applied parts; thiner railings not to mention DCC and sound..... All in all some great strides.

Cost has also increased; DCC/sound equipped locomotives are in the $ 300.00 range and show no sign of getting cheaper. Freight cars approach $ 50.00 in some markets and passenger cars well over that. The reasons are well known; the increased costs of improved models coupled with rapidly rising costs on assembly (not so much production) and packaging are causing the "raw materials" of our hobby to become more expensive. We're certainly getting more; but we're paying for it.

We A@@hats here at TRW constantly advocate for "more, better models".... (insert your own quip or joke here about never being satisfied...) As we, and the market drive the N scale RTR market towards these more detailed models we are also driving the price up; the question is' "where is the tipping point"?

When does the cost to offer these models (more detailed, more obscure, fewer road names, more road specific etc...) make them, and perhaps a large segment of the hobby's products out of reach to the average modeller? Have we forsaken "modelling" for demanding higher quality RTR products? Can the hobby support a two tiered system (entry level and craftsman, and, if so; can high end modellers live with a entry level model in place of their desired craftsman model (al la the Trainman GP15)

As we enter 2015 and all watch the rapidly increasing costs of Chinese production and the effect of tumbling oil prices effect almost evert facet of the global economy I'm interested in your take on this question; where is your tipping point?
Model railroading isn't saving my life, but it's providing me moments of joy not normally associated with my current situation..... Train are good!

CBQ Fan

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Re: Where is the tipping point?
« Reply #1 on: December 28, 2014, 09:59:13 AM »
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I don't mind paying for details if they are road specific and accurate to the prototype.  Also almost anything offered in CB&Q will be on my purchase list, unless it is so far off from prototype to be laughable or poor quality. 
Brian

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jdcolombo

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Re: Where is the tipping point?
« Reply #2 on: December 28, 2014, 10:35:57 AM »
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I don't think there is one "tipping point" - I think it depends on what is important to the individual modeler and how much disposable income they have dedicated to the hobby.  But here are a few observations that I think are true (today - who knows about a year from now, which is what most manufacturers are designing for today).

1.  Like CBQ Fan, I think most people will pay more for prototype-specific details (and excellent running/pulling power for locomotives) for their "home" road.  I buy nearly everything that says "NKP" on it, even if it doesn't exactly fit my 1957 time line, and I would pay dearly for NKP-detail-specific motive power that ran superbly and pulled well.  I have high hopes for the Bachmann Berk; I'd easily pay $300 for an NKP-specific light Mike that ran and pulled superbly.  Same for rolling stock - heck I invested $500 of my own money just to get a 3D-printed version of the NKP 1000-series caboose, because it was so iconic to the road and was never going to be manufactured in N scale.

2.  For now, DCC and sound should be optional in locomotives.  Design them for conversion, but as long as it is significantly cheaper to build a DC-only version, do that, and let the folks interested in DCC and sound do their own conversion.  At some point down the road, this won't make sense either from a manufacturing cost or market-penetration standpoint, but right now it does.  Even though I'm a big fan of sound, I'd really rather "roll my own" in most circumstances, and I suspect that those of us interested in DCC and sound are perfectly capable of a moderate-complexity conversion.  Save the DC guys some cash.

3.  The idea of having two levels of models (a la Atlas' "master line" and "trainman" line), one with higher detail (and cost) and one with "just good" detail is useful, especially for companies (probably not Rapido Trains!) that already have older tooling that they have already recovered the cost on.  Again, this is a good way to save some money and "fill in" one's rolling stock requirements outside of the home road.   But the "lower line" stuff needs to be at least "good," with currently-accepted standard practices (e.g., lo-profile wheels and knuckle couplers).

I'm glad I'm not in this business.  The idea of trying to hit the sweet spot on cost vs. quality for every production run or risk a financial disaster would have killed me a long time ago.  My hat is off to those of you who do this for a living.

John C.


Puddington

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Re: Where is the tipping point?
« Reply #3 on: December 28, 2014, 10:42:29 AM »
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"If you'd only get rid of the details (piping, free standing ladders etc..) you'd be able to reduce the price..." We hear this all the time. Regardless of how true it is (and it's not a s true as some would like to believe) is this an option people want ? It's not economically feasible to make two versions of a model (craftsman and striped down) so which one is the right one to offer...?
Model railroading isn't saving my life, but it's providing me moments of joy not normally associated with my current situation..... Train are good!

mu26aeh

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Re: Where is the tipping point?
« Reply #4 on: December 28, 2014, 10:44:36 AM »
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Being in N Scale, I generally have a limit of $25/car.  I will go over if there is something I really want but doesn't happen too often.  I am on the hook for a sound equipped SD40-2 from Intermountain if/when they finally show up, but I doubt very much I will get more sound units.  Too many and if ruins the effect.  Locomotives I stay under $125 if brand new, but there is enough here on the for sale page and NSYS that I can generally get for half that price.  I'm getting to the point that I have more then enough locomotives for my layout if and when it gets completed.  Freight car wise, I have some types that I need a few more and others that I would like to upgrade from stuff I bought 20 years ago that is crude from today's stand point.

bbussey

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Re: Where is the tipping point?
« Reply #5 on: December 28, 2014, 11:29:34 AM »
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Good question. It's even more pertinent for manufacturers that don't have a large inventory of older tooling which can be recycled as entry-level models.  The upcoming GSC well car is a test case of sorts, as it is designed for press-fit assembly and does not require cement or screws – all of which should result in lower labor cost. But the MSRP still is going to be higher than I would have liked, and it won't be south of $30.

My stance is: as long as there still are lower-end entry-level items available and affordable, the industry will be fine. Modelers have the opportunity to graduate to the higher-end models, but are not forced to. Once a modeler can justify the additional cost to himself/herself (due to prototype accuracy/need), he/she will not have an issue with said cost.
« Last Edit: December 28, 2014, 12:43:26 PM by bbussey »
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thomasjmdavis

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Re: Where is the tipping point?
« Reply #6 on: December 28, 2014, 11:31:57 AM »
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I have been a "modeler" (that is, aware of prototype, considering accuracy, and actually building models, not just running trains) since the late 1960's when I was a teen and moved away from buying everything RTR, and started worrying about whether the ATSF actually ever had loco X or car Y.  The price-quality-availability question (or niche vs. mass market, if you want to look at it that way) has always been there.  I think what has changed is that the "brass" standard is substantially gone.  In the 1970s, if you wanted an accurate model of a PRR diner or CN sleeper, you either built it from a kit (that would be composed of some metal sides, some white metal castings, and a pile of stripwood) or you paid a week's salary for a brass model of what you wanted. Nowadays, we actually often get better quality, more accurate models in plastic, all set to go, than the brass of even 15 or 20 years ago. 

I don't think it surprises anyone that a Rapido passenger car in the 2010's is substantially more expensive than its Bachmann ancestor of 1075 (although when you adjust for inflation, not so much more expensive after all).  I have come to the conclusion, personally, that my own perception of value is often different from the manufacturers' cost realities.  A couple things have surprised me.  For example, a MT passenger car is the same price (more or less) as a MT freight car- in my head, freight cars should be less, just as they usually were in my youth. And how is that I can buy a diner for the cost of 2 pair of trucks that go under the diner?  Likewise, a car with an interior should be more than a car without- but as a rule, a baggage car with little or no interior is usually priced the same as the coach.  And I wonder if manufacturers should not be more realistic in their planning and production- we need 5 times as many coaches as diners- so it might make sense to me to have coaches and baggage cars produced as "mass market" while diners, domes or observations would be produced as "limited editions." 

Most of my own misconceptions on price are that the value to me is not relevant to the cost of production, shipping and marketing.  That is, much of the cost of the model is not a matter of what is modeled, or how much plastic is involved, but how difficult it is to make the molds for the particular item, and the per item cost structure of the particular manufacturer (that is, packaging, advertising and transportation amortized over all of the production of the manufacturer).  So the whole cost to put a diner into my hands may only be 25 cents more than a boxcar.  However, how it is that MT makes a heavyweight for $25, or Fox Valley makes the Milwaukee freight and passenger cars at the price point they do, is beyond me- I just take advantage of it.

In terms of "what I will pay for"-

I have a fair sized collection of both freight and (especially) passenger cars, so I am becoming more selective in what I buy- which means I am buying less but have more budget to spend on it.  So, in my own personal case, I will have no problem spending the $50 it will take to put a Rapido Erie 10-5 on my layout, but will forgo the CN Daynighters, as out of period- and I don't think they were ever painted in the green-black scheme (although I might shell out for a couple of the original CN coaches if bodies for those turn up).  I know they are very close to the 1954 cars, but I am not likely to shell out $50 for "close."  In a way, I am disappointed that Rapido chose to do the 10-5 over the 6-4-6 Green cars in N, as I could use several of those, and as near as I can find, the 10-5s very seldom made it into a train into Chicago (even the Erie cars seldom made it into Chicago, but I am trying to be supportive).

And I don't mind doing some of the work- I actually enjoy it.  Best values out there are perhaps the MT "undecorated" cars- which generally come unassembled. Since I would have to take it apart to paint it, they saved me that trouble, and I have the option to add any details I would like.  And a substantial part of my passenger car fleet (by and large, the unfinished part) are cars built from sides from M&R, BCS, USP and LH.  I can do a passable paint job, and appreciate a manufacturer making that option available to me without my needing to strip a paint job they are charging me $5 to put on.

Qualitatively, I don't know how much better it can get- even with my bifocals on, if Rapido, or ESM (best ladders I think I have ever seen that weren't etched metal), or several other manufacturers, were to go to finer detail, not sure I would be able to see it.  On prototype accuracy- I expect manufacturers to select prototypes they think they can make a profit on. What I want them to do is accurately render the prototype, and then tell me WHAT IT IS.  It is fine with me if someone makes a NP prototype and paints it for ACL- I just want to know before preordering and then being disappointed (more likely, I will wait a couple years, pick one up on eBay, and then cut and paste a bit to get what I wanted in the first place).

All that said, I think there is a need for good quality entry level models and kits- so that young people can get a start in the hobby and turn out models that a several steps above "toys."  Atlas Trainman is trying to fill this niche, I think, but there is probably more room.  And it is nice to be able to go into a hobby shop and come out with 8 cars for $100, not with the level of detail that we would expect from high end products, but which with a little weathering can pass for a "standard" boxcar or hopper.

Sorry if that turned in to a ramble...

Tom D
Tom D.

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thomasjmdavis

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Re: Where is the tipping point?
« Reply #7 on: December 28, 2014, 11:54:14 AM »
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"its Bachmann ancestor of 1075"
Make that "1975."

Visions of medieval blacksmith hammering out a shorty passenger car....

"If you'd only get rid of the details (piping, free standing ladders etc..) you'd be able to reduce the price..." We hear this all the time. Regardless of how true it is (and it's not a s true as some would like to believe) is this an option people want?"

As probably implied in the above, I would be happy if you made a "simplified" car and offered a separate detail kit- if that helps market the product.  Might actually be happier with that- for example, you could do a relatively non-detailed underframe for a passenger car, and then give me the option to purchase kits for electrical or steam-ejector AC.
Tom D.

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Rossford Yard

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Re: Where is the tipping point?
« Reply #8 on: December 28, 2014, 12:19:01 PM »
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Good question. It's even more pertinent for manufacturers that don't have a large inventory of older tooling which can be recycled as entry-level models.  The upcoming GSC well car is a test case of sorts, as it is designed for press-fit assembly and does not requiring cement or screws – all of which should result in lower labor cost. But the MSRP still is going to be higher than I would have liked, and it won't be south of $30.

My stance is: as long as there still are lower-end entry-level items available and affordable, the industry will be fine. Modelers have the opportunity to graduate to the higher-end models, but are not forced to. Once a modeler can justify the additional cost to himself/herself (due to prototype accuracy/need), he/she will not have an issue with said cost.

I agree with this. It seems the market is sort of naturally sorting itself into two levels.  We can probably get an idea of how much of each level is sold by paying attention to the number or releases of each type, and maybe looking over LHS shelves to see what sits and what doesn't remain. 

Haven't done that, but general impression is that the detailed stuff sells better, although that might be influenced by the special order system for more expensive items, whereas LHS might order more cheaper stuff for stock.   But, just a guess.  If correct, it means we haven't hit any theoretical tipping point.

There are many recreation industries (I am in golf biz) that are accused of chasing their best customers to max out returns, at the expense of growth from new customers and encouraging youth participation.  I get the sense that this is what is happening in the MRR world.

It has also happened in other industries, and in fact, probably in certain decades, like the 1990's where discretionary spending businesses focused on the short term profits of higher margin cars, boats, vacations, etc..  Eventually, the mfgs came back to the value stuff as the economy dictated.  I suspect MRR has and will be the same, as the mfgs are pretty smart guys, and will evaluate (with a few mis-steps every year to be sure) and adjust as the sales tell them to.

Tom D's post pretty well describes the buying decisions of a lot of us.  If it is a train we really want/need for our collection or model depiction, we pay any price.  If its just a nice train, like the SP Daylight, we might buy it.  Just as the phrase "the economy" turns 315 Million people, millions of businesses making literally hundreds of spending decisions each day (or over a Trillion individual decisions) into one thing for simplicity, the phrase "MRR market" takes perhaps 500K modelers at different stages of life, deciding over many years what and how much to buy, into one vaguely inaccurate measure.  Because it has a lot of factors, the "market" will change slowly, not overnight.

I have checked and the Hobby Mfg. Assoc. has no current report on total hobby spending.  It looks like they do them every two years, and I guess we have to wait until March of next year to see the latest report.   However, the 2011 report had MRR spending steady at $425M from 2008 to 2010 during the lingering recession. The last report was in March 2013 and MR at the wholesale level, rose from $424,770,000 to $516,465,000, between 2010 and 2012, which would be at the early point of the recovery. 

And, BTW, of all hobby categories, MRR is the biggest. And, these are wholesale numbers, meaning we as modelers probably topped $1 Billion in spending for the first time back in the early 2000's (since wholesale is 40-50% of retail price, typically) and most certainly did it by 2012.  Model railroading accounted for a whopping 0.0067% of the US National GDP!  Whoo Hoo!

All kidding aside, I guess you could read those spending numbers several ways, but it would seem most of them would have to be pretty good, no?  They didn't dip near as much in the recession as many non essential spending items, and rose quickly as the economy improved.  That does indicate some strength or loyalty to the hobby.  Not sure if it suggests that we core modelers are the only ones keeping on spending, just on more expensive stuff, as Tom D notes.  On the other hand, most of us long time hobbyists have most of what we need and are slowing down spending on the basics, so that extra $90M in spending had to come from newcomers, at least in part, no?
« Last Edit: December 28, 2014, 12:30:52 PM by Rossford Yard »

C855B

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Re: Where is the tipping point?
« Reply #9 on: December 28, 2014, 12:39:01 PM »
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...I don't think it surprises anyone that a Rapido passenger car in the 2010's is substantially more expensive than its Bachmann ancestor of 1075 ...

Yes, those early Bachmann models were truly in the Dark Ages. :D :ashat:

Anyhoo... I agree with John - there is no single "tipping point". There is also no single style of N scale modeler.

F'rinstance... a railfan of heavy mainline railroading, I am predominately an "ambiance" modeler. My objective (as well-documented in my layout thread) is sweeping vistas with long trains. While I very much appreciate high levels of detail, so far I have mostly been shying away from the new breed of highly-detailed rolling stock unless, like John said, it strikes a note with my particular prototype. The increased cost is definitely an issue, when you're "in the business" of building 50-, 60- and 70-car trains, the costs get out of control very quickly. Also, extreme details get lost in the ambiance of large-scope layouts, especially when the trains are moving. This is the HO vs. N distinction - you can get insane with details in HO, spending your life getting extreme with very nice individual models, but rarely does that modeling translate to, again, 50+-car trains with three, four or five on the point. Even the HO super-detailers do one of something and then move on. A whole train? Are you nuts?

One "detail"-related issue, however, that I find surprisingly important - wheels and couplers. I find that nothing draws my eye away from quality modeling of rolling stock more than huge blocky couplers and slab wheels with big flanges. Wheels must be dished with fine rims, flanges no more than NMRA - preferably less. Next on the list is proportions - is the car or locomotive the right size and shape? Is it so far off that the feel is lost? (Example: Kato's too-wide hoods on their '60s & '70s EMDs.) The effects of details, in my mind's eye, tend to be diluted when the basic model is 10-20% out of whack in crucial dimensions.

When it comes to sound, I'm the anti-John. (Sorry, John!) I cut speaker leads in the models where the choice is buy with sound, or simply do without the model (Athearn steam, recent BLI diesels). Again, that ambiance thing, and in my railfan world model sound regardless of scale will never result in an accurate reproduction of the trackside experience. I am a little angry that up-and-coming firms like BLI are doing nice models and no longer offering without-sound versions, so, again, you pay the premium for sound or you don't get it, sorry. (I'd love to have a pair of the upcoming Centipedes in the almost-foob UP paint, but not at that price.)

I'm fully into DCC, but I prefer to install my own. There are enough differences between the brands that it is easier from the operation, maintenance and - above all - debugging perspectives to have the same brand in the entire fleet whenever possible. I spend much less modeling time hunched over tech manuals when it's a decoder I basically know.

I'm pragmatic and savvy enough to understand that leaving off details where the tooling and production have already been committed will in no way reduce the price. And as for not doing them at all? No! Well... maybe. The FVM GP60s dipped their toes into the area of detail overkill. Given the huge queue on my workbench that gets no attention these days due to the efforts devoted to the layout building, I have four brand-new models sitting there waiting for decoders, grabs and the whatnot included in the box. So they're gathering dust. Also, the one attempt to install a decoder resulted in chasing a couple of tenuously-attached details that fell off in the handling, turning a 5-minute plug-in decoder install into a 2-hour search for fiddly bits and trying to secure them so there wasn't a repeat, say, while running on the club layout. Been there.

So that all said, to Mike's original query, there is a practical limit on details, and there are limits to what we will pay - but it's not "price", it's value. If a higher-priced, ultra-detailed bit of rolling stock doesn't add perceptible value to my ambiance goals, and it's not distinctive and specific to my prototype (which is also sort of an ambiance issue), I'll pass it by.
...mike

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CBQ Fan

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Re: Where is the tipping point?
« Reply #10 on: December 28, 2014, 12:41:26 PM »
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I think my issue on price is more around the timing of deliveries. As unrelated as it is it seems like all my major preorders all arrive around the same time.  This is getting a little easier to plan around as production levels out.  But then you get situations like Intermountain F unit announcements several months apart with the same ETA, only to be reset later and a similar gap from the first offering to the second.
Brian

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Rossford Yard

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Re: Where is the tipping point?
« Reply #11 on: December 28, 2014, 01:45:08 PM »
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Hopefully, the China Syndrome is over and the mfgs will have a more reliable delivery schedule. During the tough times, they probably were glad to bring any product to market.

That said, there have been complaints for obvious and similar reasons since I was a wee lad.  It is an issue.  I think the various mfgs sort of work around each other, but not to point of collusion to spread out releases.  I think they know Mr. Wallet needs a rest from time to time, but they are guessing and it is hard to please everyone.

That is similar to the detail issue in the OP, where a mass produced piece of rolling stock needs to have one level basically satisfy the most modelers and garner the most sales.  I bet they have discussions and even read this thread in order to divine what they can about what we want.

As mentioned, it looks like they have decided re-issues will be kept lower price, and new issues will have more detail, with etched brass, moving doors, etc.  Or, take some old stock, a la MT, and weather and graffiti it into a higher level product.  Great idea and its about the only rolling stock I buy now, to get some semblance of the post 2000 grunge look.

As someone said, I am glad I am not in the biz.

Kisatchie

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Re: Where is the tipping point?
« Reply #12 on: December 28, 2014, 04:53:47 PM »
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I'm completely happy with the level of detail found in Micro-Trains cars (and Intermountain cars, too). My limit is $25 per new car. I get most of my freight cars from eBay, where, amazingly enough, some good deals are still to be had.


Hmm... I got a great
deal on 500 pounds of
bananas. Now, to figure
out what to do with them
before they go bad...


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peteski

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Re: Where is the tipping point?
« Reply #13 on: December 28, 2014, 05:03:10 PM »
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I have a slightly different view. While nice, I really don't care about the number of free-standing separately-applied (by bunch of Chinese women) details.  Especially if those fancy details are injection-molder free-standing ladders which are grossly oversize!  Unless you can make those details truly in-scale (probably using photo-etched metal), simply mold the scale-size details onto the body of the car!!!!!

To me more important would be a better prototype accuracy.  Make a correctly scaled boxcar, which uses a modular construction: Have several types of ends, roofs and doors which can be mixed/matched to produce a correct model for the paint scheme.  Having all those separate molds would cost extra, so leave the fine body details in-scale and molded on the body.  The delicate add-on stuff will break off during operations anyways. Leave the underside with minimal detailing. Who sees all that fine brake piping anyway?  That would offset the manufacturing and assembly costs so the accurate car (with fewer a$$-on details) would cost the same as a less accurate museum-quality car wit all the separately-applied details.
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wcfn100

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Re: Where is the tipping point?
« Reply #14 on: December 28, 2014, 05:05:30 PM »
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The tipping point is glue.

Jason