AVRNUT Greybeard If the manufaccturing is so much cheaper, who is it cheaper for? In this case it was cheaper for the parent company, Atlas, but not really for the consumer. I think the only reason they shifted production to China was not so much to keep the retail price low, but to increase the profit margin. I think they figured, why make the product here and settle for a 50-100% profit margin when we can have it made in China, sell it for the same price & make a 300-400% profit margin? Well, it backfired on them. They lost control of their production. A higher profit margin is meaningless if you have no product to sell and you're losing sales to your competitors. Obviously, people are willing to pay the difference for other brands because at least it is available. And they're finding out that in many ways those other brands are better products. I wonder how much longer Atlas is going to put up with this & finally realize that this whole China deal was a mistake. Yes, if you brought the track production back home you would likely have to charge the same prices as the track that is made here now. Well, people are already willing to pay that anyway, so why not? Carl
Greybeard If the manufaccturing is so much cheaper, who is it cheaper for?
In this case it was cheaper for the parent company, Atlas, but not really for the consumer. I think the only reason they shifted production to China was not so much to keep the retail price low, but to increase the profit margin. I think they figured, why make the product here and settle for a 50-100% profit margin when we can have it made in China, sell it for the same price & make a 300-400% profit margin?
Well, it backfired on them. They lost control of their production. A higher profit margin is meaningless if you have no product to sell and you're losing sales to your competitors. Obviously, people are willing to pay the difference for other brands because at least it is available. And they're finding out that in many ways those other brands are better products. I wonder how much longer Atlas is going to put up with this & finally realize that this whole China deal was a mistake.
Yes, if you brought the track production back home you would likely have to charge the same prices as the track that is made here now. Well, people are already willing to pay that anyway, so why not?
Carl
+1..
You hit the old spike on the head..
Larry
Conductor.
Summerset Ry.
"Stay Alert, Don't get hurt Safety First!"
AVRNUT Took me weeks to find a L & R #4 turnouts that I needed for a new section of the layout. Finally a couple showed up on Ebay & I grabbed them. I'm going to need at least 4 more, but can't find them.
Took me weeks to find a L & R #4 turnouts that I needed for a new section of the layout. Finally a couple showed up on Ebay & I grabbed them. I'm going to need at least 4 more, but can't find them.
LH or RH or both?
Alton Junction
richhotrain AVRNUT Took me weeks to find a L & R #4 turnouts that I needed for a new section of the layout. Finally a couple showed up on Ebay & I grabbed them. I'm going to need at least 4 more, but can't find them. LH or RH or both?
Probably both. The section of layout I'll need them for is still in the planning stages & I haven't completely decided on the configuration of it yet & it's still months away from construction. I'm adding the small Aroostook Valley yard just off the mainline on the very last portion of the layout that I'm building. Most of my layout is 22" radius with #8 turnouts, so that I can run passenger trains with 60 footers. But the little AVR yard is frieght only & the only locos that will be used in it are little 44 tonners, so I'm going with 18" radius & #4 turnouts there, (and a couple Wye's) just because of space limitations. I'm hoping that by the time I get to that point, the Atlas situation will be better. I have the two #4's I need for the present, a siding on the CP line in a confined space along a river bank.
"I could never belong to any club that would have me as a member."
I'm glad I bought the 8 boxes of Atlas track and all my #6 turnouts 8 years ago when it was very cheap and made here in the USA. If you look at the older Code 83 and the new code 83 you will see the tops of the spikes holding the rail on the ties is half the size. Be very careful how you flex the track or you will end up with a 3 foot piece of ties with only one rail on it, don't ask but you couldn't give me a piece of the new Atlas trck. They are using half the plastic they used to and are charging 4 times the price it used to be when it was made here. I wonder if the former employies that made it here are reading this forum and laughing about everyones yeas and nays about the troubles Atlas is having and are working for Peco, Model Power and the other competitors today. Jim.
Gondola1988,
This comment is not about Atlas track, but about what You said about plastic. I am in the process of kit bashing a rather large rail truck terminal, comprising of three Walthers Cornerstone 933-2918 kits of the Open Air Transload Buildings end to end. I had two for a couple of years, just sitting in the boxes, so I decided to order one more to start my project, OK, got it opened it up, all nicely wrapped in plastic, first thing I noticed, the colors are different, other two are white, dark grey roofs, blue doors and detail trim, the new one, off white walls, almost black roof and light grey doors and trim, OK, I'll have to paint them all. Now continued looking through the rest of the parts and what do I find? Part of the long roof edge is missing, looks as though the injection molding machine skimped on the amount of plastic to fill the mold. I was going to let Walthers know, but I thought the heck with it, I'll fix it rather than go through the hassle.
BTW, The first kit was made in Denmark, second, in Germany, third, the clincher, made in Taiwan.
Good Day, All
Frank
Hmm, I have to see how many sticks of Atlas C83 flex I still have left. Not going ot be using any track for a while. With the hysteria, I should be able to get a good buck on ebay....
--Randy
Modeling the Reading Railroad in the 1950's
Visit my web site at www.readingeastpenn.com for construction updates, DCC Info, and more.
rrinkerI have to see how many sticks of Atlas C83 flex I still have left. Not going ot be using any track for a while. With the hysteria, I should be able to get a good buck on ebay.... --Randy
Randy,If your luck runs like mine has lately you will need that track shortly after you sell it.
Nope, see my other thread, I'm buying a house, this layout is getting torn down, plus I have 5 sticks of Peco flex on hand as well. Going to be another year at least before I start building again - with getting moved in, "honey do" lists, prepping the basement, and of course designing a layout.
AVRNUTAVRNUT wrote the following post 8 hours ago: Greybeard If the manufaccturing is so much cheaper, who is it cheaper for? In this case it was cheaper for the parent company, Atlas, but not really for the consumer. I think the only reason they shifted production to China was not so much to keep the retail price low, but to increase the profit margin. I think they figured, why make the product here and settle for a 50-100% profit margin when we can have it made in China, sell it for the same price & make a 300-400% profit margin?
I was being sarcastic. I'm aware that the only motive for moving production anywhere, here or abroad, is profit. The customer doesn't mean anything except what the companies see as an endless source of money. If that decision turns around and bites Atlas, I'll cheer. Maybe a few others would have to look at the same happening to them.
"...I think the only reason they shifted production to China was not so much to keep the retail price low, but to increase the profit margin..."
Any business meant to survive in the market place would make no such distinction. If it needs a profit margin of a certain order, and can only secure it by reducing costs, what else should they do? If they pass on increases to the consumer that could actually stand to bear themselves, they run the risk of being squeezed out of the market.
selectorAny business meant to survive in the market place would make no such distinction. If it needs a profit margin of a certain order, and can only secure it by reducing costs, what else should they do? If they pass on increases to the consumer that could actually stand to bear themselves, they run the risk of being squeezed out of the market.
And in the process loose customers to their competitors due to a lack of product to sell to their customers and we all know that can and does lead to red ink bottom line and we all know where that ends.
They need to start teaching common business sense in Business 101.
selector "...I think the only reason they shifted production to China was not so much to keep the retail price low, but to increase the profit margin..." Any business meant to survive in the market place would make no such distinction. If it needs a profit margin of a certain order, and can only secure it by reducing costs, what else should they do? If they pass on increases to the consumer that could actually stand to bear themselves, they run the risk of being squeezed out of the market.
I would say that with no product to sell and their customers being forced to go elsewhere for what they need, Atlas is squeezing themselves out of the track market. And they have no one but themselves to blame for it, because they have allowed this situation to exist for far too long. You can't stay in business when all you can deliver are "promised delivery schedules" that keep getting pushed back and pushed back month after month. People tend to not want to pay very much for un-fulfilled promises. Profit margin isn't too good on them either.
It's not liek they set out to make sure they had no product. Fritz is probably the only one in any of these threads to actually get it right. Atlas got hosed by less than scrupulous Chinese manufacturers and Chinese law that held their tooling hostage. They absolutely did not set uout to have a year go by with little or no product, the plan was a few months while production shifted. Not unreasonable, and not really wishful thinking on their part. I know too many people that travel to China and other places like Thailand, they have ot ride herd on the factories because if you don't, you get poor products.
Greybeard I was being sarcastic. I'm aware that the only motive for moving production anywhere, here or abroad, is profit. The customer doesn't mean anything except what the companies see as an endless source of money. If that decision turns around and bites Atlas, I'll cheer. Maybe a few others would have to look at the same happening to them.
Ah, yes. Down with evil businesses that supply (or don't supply) us hobbyists what we want entirely at their own risk. Practically all of them (Atlas and Bachmann being the known exceptions) are small businesses owned and run by a small group or family who were/are into model railroading themselves.
I would disagree that customers mean nothing but an endless source of money to model railroad companies. Customer satisfaction is everything in this line of work - there are too many alternatives for customers who feel "taken". But I'm not going to convince the cynics in this crowd. Only when they go into the model railroad business themselves will they see how difficult a market it is to serve well.
Costs have to be kept in line with the competition for a company to be profitable. Without a reasonable profit, the company goes out of business. Period. In my line of real work, we are generally a prime or general contractor with several key partners and suppliers. We have to make sure that we do not squeeze them too much on price or payment schedule, or we end up failing as a prime or general contractor because our suppliers failed.
Atlas has always produced their locomotives and rolling stock abroad; only the track was produced in the U.S. When Walthers first contracted with Japan-based Shinohara for their code 83 track, they were actually lower cost than Atlas. This was Atlas's first serious competition in the track market since the days of Tru-scale. Atlas then went to China for both rolling stock and track to keep their costs in line with their competition, thereby retaining market share and position as the low cost track manufacturer.
MTH bankrupted Lionel in the 1990s by moving their production to Korea, and later China ahead of Lionel.
Yes, by all means cheer if Atlas goes belly up because of their China problems. Not Walthers/Shinohara, not Peco, not ME, not even all 3 combined could make up completely for the permanent loss of Atlas track from the market.
just my thoughts and experiences
Fred W
Well, let's see............you have a country with less than scrupulous manufacturers.
You have a country where their laws can hold your production & tooling hostage.
You have a country where if you don't ride herd on the manufacturers, you get a poor product.
That would certainly seem an attractive atmosphere in which to have a product with a well known, trusted brand on it made.
Sorry, but it was a poor decision to begin with. And staying there after all this time while these issues continue with no end in sight is an even poorer one.
AVRNUT Well, let's see............you have a country with less than scrupulous manufacturers. You have a country where their laws can hold your production & tooling hostage. You have a country where if you don't ride herd on the manufacturers, you get a poor product. That would certainly seem an attractive atmosphere in which to have a product with a well known, trusted brand on it made. Sorry, but it was a poor decision to begin with. And staying there after all this time while these issues continue with no end in sight is an even poorer one.
Yeah, hindsight is fantastic. Unfortunately, only the 3rd point was common knowledge 10-15 years ago when the out-sourcing decisions were made. What was also common knowledge 10-15 years ago was that your competition that had already moved to China was producing at a lower cost than you were. At the time, ME was the high-cost track producer, but they served a niche market that was willing to pay extra for the finer detail and the smaller rail size.
fwrightYes, by all means cheer if Atlas goes belly up because of their China problems. Not Walthers/Shinohara, not Peco, not ME, not even all 3 combined could make up completely for the permanent loss of Atlas track from the market.
Atlas would be a great lost as far as locomotives and freight cars..N Scale would be devastated since Atlas is still the main supplier of locomotives.
Track wise..
As the on going Atlas track shortage as shown modelers that really need and want track is turning to Peco,ME and other brands..Peco and ME seems to be keeping up with the demand.
alco_fan BATMAN Rapido would not have moved into the track business. So far, they still have not. Waiting for their product to come ... from China.
BATMAN Rapido would not have moved into the track business.
So far, they still have not. Waiting for their product to come ... from China.
The first shipment of Code 100 track was delivered to distributors last week.
Code 83 and more Code 100 are leaving the factory in the next few days.
-Jason
Jason Shron - President - Rapido Trains Inc. - RapidoTrains.comMy HO scale Kingston Sub layout: Facebook.com/KingstonSub
This thread sure is funny.
Atlas is delivering hundreds of code 100 turnouts, but they are selling like crazy. One online store has gone from over 400 #6 turnouts to less than 40 in the space of a couple of weeks. Snap switches before Christmas were over 1000 and are now down around 300 at this same dealer. (I don't know how much they got in since I don't check HO track very often.)
Atlas is producing and delivering. But catching up is going to take a while. I think people are stockpiling the stuff, which of course keeps the shortage going.
Paul
"I would say that with no product to sell and their customers being forced to go elsewhere for what they need, Atlas is squeezing themselves out of the track market. And they have no one but themselves to blame for it, because they have allowed this situation to exist for far too long. You can't stay in business when all you can deliver are "promised delivery schedules" that keep getting pushed back and pushed back month after month. People tend to not want to pay very much for un-fulfilled promises. Profit margin isn't too good on them either.
Carl"
You have a straw man argument there. I thought we were talking about profits and intents. Now you switch to a poor decision based on Chinese culture. Which is it to be...I can't keep up.
Swedish Custom painter and model maker. My Website:
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I would like to hear from someone like Jason Shron at Rapido Trains who has production facilities in China.
Without asking him to criticize Atlas, what is the problem?
Can the Chinese be relied upon to produce a quality product? Is there a mismanagement problem when your track production comes to a complete halt for 1 to 2 years?
Let's hear from someone who has been there.
Rich
richhotrainLet's hear from someone who has been there.
Well, Rich, I have been there! Up until 2009, I did quite a lot of business in the field of precision castings with a number of foundries in China and spent a lot of time over there. Here is my impression:
QC is an ongoing issue. As long as you don´t have your own QC staff on-site, you will always encounter quality problems. A lot of companies underestimate the cost of setting up a rigid quality regime in China.
Chinese manufacturers don´t say no - they will always promise you they can do just everything and that they have a tremendous experience in what you want them to do.
Delivery schedules are not worth the paper they are written on. Unless you have own staff monitoring the production process, meeting deadlines is just a gamble.
Chinese managers still think in production quotas, regardless whether the product is good or bad.
Now, I don´t say that one cannot do on-time, quality business with Chinese manufacturers, but you need to be prepared to invest a sizable amount into it. QC and process control need to be in your hands. That´s what the Japanese do. Companies like Kato, who do most of their manufacturing in China, do dispatch a lot of staff to China to monitor each production step and initiate corrective measures within the process. Yes, all of this eats up the margin, and with the appreciation of the RMB (Yuan) and the rising wages in China, having your products made in China has become a lot less attractive. Quite many companies are right now bringing back their production for that very reason.
So, Ulrich, let me ask you a follow up question.
Is Atlas completely blameless?
IRONROOSTERAtlas is delivering hundreds of code 100 turnouts, but they are selling like crazy. One online store has gone from over 400 #6 turnouts to less than 40 in the space of a couple of weeks. Snap switches before Christmas were over 1000 and are now down around 300 at this same dealer.
Paul,Find Atlas C83 track in stock good luck.
Thousands of modelers no longer use C100 so,it may not be so funny after all.
Rich,
From my point of view, they may have been a little to "blue-eyed" () when they transfered the production to China, not knowing what expenses arise from such a venue. In my time, the first thing I did when we ran into quality and delivery issues, was to hire local QC staff, which meant we had to open a local business there. You don´t want to know what amount of red tape was involved and how high the bill ran for that exercise. Even after having local staff on board, either one of my partners or I traveled to China at least once a month. In 2009, we decided it wasn´t worth the trouble, as our customers expected to pay Chinese prices, but did not honor the effort we had to put in to get the quality they expected. Since then, things may have changed a little, but, again, the rise of the RMB and ever increasing wages make China a less attractive place to go.
Whoever thinks they can pull the same trick with Vietnam or an African country will be just repeating the same mistake.
The Chinese may operate the production phase, but they likely did not design the tooling. Surely, that was done here in the U.S.
So, how hard or time consuming could it be to transfer production back to the good old USA?
transfering the tooling back to the US is virtually impossible. The PR China hardly honors any international trade agreement, unless it is to their benefit.
We finally gave up trying to move the tooling.
BRAKIE IRONROOSTER Atlas is delivering hundreds of code 100 turnouts, but they are selling like crazy. One online store has gone from over 400 #6 turnouts to less than 40 in the space of a couple of weeks. Snap switches before Christmas were over 1000 and are now down around 300 at this same dealer. Paul,Find Atlas C83 track in stock good luck. Thousands of modelers no longer use C100 so,it may not be so funny after all.
IRONROOSTER Atlas is delivering hundreds of code 100 turnouts, but they are selling like crazy. One online store has gone from over 400 #6 turnouts to less than 40 in the space of a couple of weeks. Snap switches before Christmas were over 1000 and are now down around 300 at this same dealer.
My local Hobby Shop has both c83 and c100 in stock!
We just got 2 cases of c100 track in last week and the c100 turnouts are starting to arrive!
You guys are just venting to hear yourselves talk!
BOB H - Clarion, PA
cmrproducts My local Hobby Shop has both c83 and c100 in stock! We just got 2 cases of c100 track in last week and the c100 turnouts are starting to arrive! You guys are just venting to hear yourselves talk! BOB H - Clarion, PA
Bob, you are not very sympathetic to your fellow modelers, but I could care less since I switched from Atlas to Peco when Atlas could no longer deliver.
But, in deference to our fellow modelers, I just checked three huge on line retailers - - MB Klein, Caboose Hobbies, and Hobbylinc - - - and none of them have Atlas Code 83 track in stock.
For all we know, you could be making up that stuff about your LHS having Atlas Code 83 track in stock.