Cheap Days Over

[Theakerr]

Just heard on the BBC News (Canada) that the Chinese Government will allow some upward movement on the Yuan. No time frame given, but it will clearly result in an increase in the price of many things including our beloved model railway components. You guys in the UK are already seeing increases as a result of the devalued pound, so now it will get even worse. Interestingly, I heard a story (cannot verify its veracity) that both Hornby and Bachmann have switched some manufacturing to India in anticipation of the Yuan's increase

[jamie92208]

Just heard on the BBC News (Canada) that the Chinese Government will allow some upward movement on the Yuan. No time frame given, but it will clearly result in an increase in the price of many things including our beloved model railway components. You guys in the UK are already seeing increases as a result of the devalued pound, so now it will get even worse. Interestingly, I heard a story (cannot verify its veracity) that both Hornby and Bachmann have switched some manufacturing to India in anticipation of the Yuan's increase

 

Perhaps they might even start manufacturing here in the UK again and lose all the transport costs.

 

Jamie

[Guest Max Stafford]

Indian production? That should make for some interesting wiring...?

 

Dave.

[Pinkmouse]

Indian production? That should make for some interesting wiring...?

 

Dave.

 

Ahh, casual racism. They certainly couldn't do any worse than the "interesting" wiring in just about every British made car I've ever owned.

[Guest Max Stafford]

Now you've scored your easy diversity point mate, here's what I was on about.

http://www.loupiote.com/photos/3700155454.shtml

Not quite 'Speke TR7' quality, but getting close!

 

Dave.

[JZ]

Now you've scored your easy diversity point mate, here's what I was on about.

http://www.loupiote....700155454.shtml

Not quite 'Speke TR7' quality, but getting close!

 

Dave.

 

You think that's bad ? You should see under my layout

[Oldddudders]

Having bought my first Japanese camera - a Nikon F - 40 years ago last week, I have spent most of my life believing far-flung nations can do things very well. I don't give two monkeys' twizzles where it's made - as long as it looks right and runs well. As for India versus China - go back 30 years and would we have predicted the quality China has recently demonstrated? And since Engish is still much-spoken in India, one feels the "translation" of the specification and brief will be a great deal more straightforward. It may not happen overnight, but it will happen.

[Jol Wilkinson]

Of course, it's not just model railways that will be affected but virtually every type of consumer product bought in this country. It was bound to happen, especially as the Chinese population start to see and want the kind of lifestyle that the West enjoys.

 

Perhaps it will bring some realism into the pricing of RTR and RTP items, which have been at rather low levels for such specialist and (relatively) low volume products. It will not be just the buyers and collectors of the mainsteam 4mm suppliers products that are affected, but also those who buy handbuilt 7mm locos, etc. that are produced in China as well. Those that make make models, rather than buy them, will be less affected, as the production of kits and components has largely remained in the UK.

 

Jol

[Guest Max Stafford]

If you look closely at many items in your house now, you'll see 'Made in India' becoming increasingly common. India's come on leaps and bounds in recent times. It's not for nothing that the country's being tipped for great things in the 21st century (yes I know, cheeky edit!). The fact that Britain and India have had a closely entwined history for 2-300 years will hopefully work to our mutual advantages.

Forty years ago, the Japanese motor industry was being laughed off as a joke in the UK, whilst the indigenous car and bike makers sat on their laurels. Now the only .major car manufacturing plant in the UK is Japanese.

So all joking about ropey wiring aside, the Indians are going places.

Their home produced Lambrettas still look scary inside though!

 

Dave.

[Pennine MC]

 

Their home produced Lambrettas still look scary inside though!

 

 

Have they got Kestrel's engines in them then?

 

 

 

 

 

 

Oh sorry, wrong thread

[PhilH]

It was always going to be a bubble waiting to burst. I suppose that once people didn't know about others' lifestyles, and so didn't aspire to them - with the advent of modern communications that has changed.

 

It's just a shame that manufacturers are looking for the next tranche of poor people to exploit just so that we in the rest of the world can buy something for nothing (and I do include myself in that category - I like toys so if prices do increase it will hit me too). I suppose that eventually they will run out of places to go to where production is cheap and there will be some sort of equity - fair price paid for the goods, fair wage paid to produce them.

[Jol Wilkinson]

Perhaps they might even start manufacturing here in the UK again and lose all the transport costs.

 

Jamie

 

Jamie

 

The recent BBC TV (I think) programme about the change in our lifestyle brought about by the introduction of containerisation (something else we have to thank the Yanks for) called The Box - or words to that effect - pointed out that the cost of shipping products around the world is very, very low. That's one of the major reasons for the huge growth in international manufacturing and trade, in conjunction with cheap labour costs and in the case of the China, an artificialy depressed exchange rate.

 

Given large labout forces in the eastern hemisphere that are willing to work to raise their standard of living and negligible transport costs, manufacturing of most consumer items will not come back to the UK, until the consumer is willing to pay a higher price for home made products. Is that likely? I don't think so.

 

Jol

[kandc_au]

The stuff made in India for the Australian market was a complete and utter failure.

You worried about how they went car making in years gone by, well the model trainmarket was worse...if that were possible.

Rough finish, things didn't run properly.

Quality control, is NOT something the Indians believe in.

Sorry to disillusion you guys but...

 

Khris

[Guest Max Stafford]

It'll come in Time Khris. Like I mentioned earlier, they used to say this about the Japanese and South Koreans.

 

Phil, your point is absolutely spot on, I suppose it will be Africa in 20 years time.

 

Ian, you're just being silly now...!

 

Dave.

[Jol Wilkinson]

 

Forty years ago, the Japanese motor industry was being laughed off as a joke in the UK, whilst the indigenous car and bike makers sat on their laurels. Now the only .major car manufacturing plant in the UK is Japanese.

 

 

Dave.

 

Dave,

 

having spent nearly all my career in the motor industry - although not in the manufacturing side - I think some of that that is a major over simplification.

 

If you are talking about Nissan as the major UK manufacturer, doesn't Renault own about 45% of it and the CEO is the same guy that runs Renault (a Frenchman called Gosn).

 

The Chinese have just bought Volvo and TATA (India) have just acquired Jaguar/Land Rover - but then Ford messed them up as did GM did to Saab! If you saw the recent progamme about Detroit, you might share my belief that the US motor industry have levels of incompetence that left the UK in the shade.

 

Jol

[Hammer]

Indian production? That should make for some interesting wiring...?

 

Dave.

 

I wouldn't bet on it. The next big source of cheap labour to supply the West is likely to be Africa. India is very much a growing economy and will eventually end up with much better safety and minimum wage laws then it had as present or then it's red neighbour (which is also why you're unlikely to see a shift of manufacturing to South America).

 

Of course, the economic downside with Africa is that some countries there already have high overheads due to being more economically advanced, some are politically unstable and some are outright warzones. But if the oil companies can make a profit from drilling in Algeria and Nigeria while spending a fortune on protection for Western specialists, then no doubt other companies can as well.

 

Hopefully something will happen to break this exploitive cycle though. It's completely unsustainable for manufacturing bases to set up, create (relative) affluence and move on. It's certainly not what Smith had in mind when he wrote Wealth of Nations, that's for sure. No, it's time we started looking for some kind of post-Globalisation model.

[PhilJ W]

Many cars on the road in this country are made in India already. I drive a Hyundai i10 made in India and I have never had any problems in the 2 years that I have had it, neither did I have problems with its predecessor also made in India. I have seen 4mm hand built Underground stock produced in Sri Lanka and there were no apparent quality problems. The main problem with manufacture overseas would be political stability, this is why much of Africa is out of the picture at the moment. India is cashing in on the fact that English is widely spoken, hence the number of call centres there and their going into IT in a big way.

[The Stationmaster]

The talk about upward movement in the value of the Yuan needs to considered carefully and in the light of at least one previous statement from the Chinese Govt that they would allow upward movement.

 

Financial pages has pointed out repratedly the fairly obvious fact that the Chinese cannot allow the Yuan to rise very much fairly quickly because that would impact on the sale of their goods overseas and they don't want to deflate their economy in that way as it would lead to unemployment. There is considerable pressure from the USA for the Chinese to revalue (for various reasons not least trade imbalance and sovereign debt) but the Chinese are playing a hard game and not budging although at the same time they are offering a few reassuring words.

Net result - the international value of the Yuan will probably rise slowly, some manufacturing will move on from China to other far Eastern countries (in the way that some has moved from Japan and Korea to China)and prices here will no doubt change.

 

But the financial pundits seem to doubt the Chinese Govt will make any serious moves in currency values for as long as the US continues its present course of trying to block Chinese inward investment 9to the US) and owing a massive debt to China.

 

So in reality I have no doubt prices for model railway imports will creep up but nothing more serious than that, unless the £ slips even further and the price of oil rises sharply.

[Trainshed Terry]

Now you've scored your easy diversity point mate, here's what I was on about.

http://www.loupiote....700155454.shtml

Not quite 'Speke TR7' quality, but getting close!

 

Dave.

 

 

Just looked at the image in question :blink: ERRR which wire goes to number "22 Tandoori Street." :P

 

It even reminds me of the wiring under the bosses desk. :rolleyes:

 

Terry.

[Guest Max Stafford]

Ultimately then, prices will rise as those who produce the goods start to ask for a standard of living like ours. We just need to accept that and have we any right to grudge them it?

 

Didn't think so.

 

I do get Hammer's take on it though, I suppose this cycle can only go on so far. If it progresses logically until the world has had its requirements for manufactured goods sated and everyone has a relatively equal standard of living, where do you go from there?

 

One for the philosophers, I think!

 

Dave.

[chris_irl]

The talk about upward movement in the value of the Yuan needs to considered carefully and in the light of at least one previous statement from the Chinese Govt that they would allow upward movement.

 

Financial pages has pointed out repratedly the fairly obvious fact that the Chinese cannot allow the Yuan to rise very much fairly quickly because that would impact on the sale of their goods overseas and they don't want to deflate their economy in that way as it would lead to unemployment. There is considerable pressure from the USA for the Chinese to revalue (for various reasons not least trade imbalance and sovereign debt) but the Chinese are playing a hard game and not budging although at the same time they are offering a few reassuring words.

Net result - the international value of the Yuan will probably rise slowly, some manufacturing will move on from China to other far Eastern countries (in the way that some has moved from Japan and Korea to China)and prices here will no doubt change.

 

But the financial pundits seem to doubt the Chinese Govt will make any serious moves in currency values for as long as the US continues its present course of trying to block Chinese inward investment 9to the US) and owing a massive debt to China.

 

So in reality I have no doubt prices for model railway imports will creep up but nothing more serious than that, unless the £ slips even further and the price of oil rises sharply.

 

True, the Chinese will not let the currency go up so much that they threaten exports in any great quantity.

Oil prices will be a far bigger influence in the short to med term I reckon.

[Poggy1165]

This could have interesting implications. If models become dearer, shall we go back to the branch line theme of the 1950s? Fewer locos, fewer items of stock. But perhaps to a higher standard of individual model. Maybe kit-bulding will become more mainstream again. Smaller, simpler layouts would mean more available time, so would more people try out P4. Or will they build a 7mm branch in the space that might have accommodated a 4mm main line?

 

Well, I suppose we shall see. For my own part, I've come to think that 4 very nice locos are better than 40 indifferent ones. (40 very nice ones would be better still, but I'm not that rich or talented.)

[mudmagnet]

An interesting debate. It was always inevitable the some production would be moved from China to other countries and not just due to the rise in the Yuan. The cost of labour in China will rise a little, but will not have a huge impact. My experience of China (I worked for a UK company that had products manufactured in China ) was the control of quality due to frequent changes in labour. Generally speaking, it appeared that female workers would come from the cities in the west of China moving to eastern China (Bejing, Shanghai, etc) where they would stay for 6 months and then move home, get married and not return to work. We would spend quite considerable time training, quality inspection and then re-training due to change in staff. Also, there appeared to be a tendancy for materials etc being changed - remember the problems with the paint applied to childrens toys being changed to a much cheaper and 'lead-based' paint.

 

Also, with the financial constraints placed on companies, they cannot afford to order the large production batches that the Chinese factories prefer and then to have the container sat on the sea for 5-6 weeks, then transfered through the UK ports. Most of these companies would be paying for the production when either leaving the factory or being loaded onto the ship. It does not make economic sense. India is much closer! A lot more products were produced in Eastern Europe when the UK factories were closed and then moved to China. Some manufacture is being moved back to Eastern Europe.

 

I'm not sure whether production in India will be any better long term (it appears that most of the UK / US companies look short-term). An ex-colleague used to travel to India quite frequently and control of quality was an even bigger issue that China. I don't see production of finished models being manufactured in India for very long. I would think that components and sub-assemblies will be produced in India (and China) then being shipped to UK for assembly. This gives more flexiblity in what can be produced - e.g. a Hornby class 50 chassis assembled to a variety of body liveries in the UK to suit demand.

 

Also, it appears to me that the prices have been creeping up anyway and the market place can only withstand a limit - sale volumes will fall. The companies will be left with simples choices - smaller batches to suit the smaller sales volumes and / or lower quality.

 

I agree with some of the other comments - we will all buy less, built smaller layouts, kit build more. I am probably like many others - we all buy more locos than we need, buying a few less seems to be the answer!

[Poggy1165]

Well, my comments were predicated on the assumption that RTR items would become significantly dearer in real terms, as I believe they were in the 1950s, when many folk could only afford 1 or 2 small locos. In such circumstances kit-building, given that kits are mainly made in the UK, might be relatively cheaper.

 

As to time, I concede that a 7mm version of Ashburton might take as long to build as a 4mm scale version of Totnes (with much depending on how much detail one includes) but the number of locos, coaches and wagons required is much smaller, even if, individually, they may well be significantly dearer. (You only really need at most two small locos for Ashburton, for Totnes you need - well, a lot, most of them big main line jobs.) I was not really thinking of ways of saving time, more of different ways in which people might choose to use the same time.

 

Any road, 'tis all by and by, because I heard on the radio this morning that the appreciation of the Chinese currency is to be limited by their government, and may only be about 1%. So I don't think that is going to make a great deal of difference to the way people do things.

[28XX]

I have always had a sneaking suspicion that we Brits have as many exploited servants per-capita now as we did in 1910, the only exception being that they are now out of sight in the far east.

 

The concept of a post-industrial economy is fallacious. The country is in a transient state at best, our inevitable change in fortunes might come quite quickly, with a rise in the value of eastern currencies being mirrored in a fall in our own as GB, Europe and the US struggle to deal with burgeoning debts.

 

The country is now being run by a generation who regard 'make do and mend' as quaint, and couldn't do it even if they wanted to. We know the price of everything, but the value of nothing. Weaning the West off this addiction to disposable 'toys', from railway models via washing machines to cars will be a real challenge.

 

Us old farts who watched diligently while dad changed the elements in the toaster, kettle and iron can smirk at their discomfort.