Tariffs & Model Airliner Prices

[Barison82]

Just for the sake of completeness, as I’m sure it’s boring everybody stiff - I got a reply back from the department, within the same day I sent it - pretty efficient! Safe enough to say, I don’t think they’re all being fired…make of this what you will.



It’ll be in here somewhere:

https://content.govdelivery.com/bulletins/gd/USDHSCBP-3d52328?wgt_ref=USDHSCBP_WIDGET_2

I even asked another question after getting this reply and he answered back within 10 mins!



So that little exercise demonstrates that the system is functioning very well indeed, but now I’ve got a headache lol.

 

[squatchys_diecast_hangar]

Poor guy. I’ll give up trying to make sense of it for now I think - it just doesn’t add up to me. Surely this would show somewhere there, it has to. I’ve not heard anything from JetCollector yet, that’s my main source. All I know is, if it does indeed end up being 20% in total on top, that’s me out of the game for sure. What a f**k up!

Yes retailers like us are in a very precarious state right now. As one distributor told me on the phone the other day, ‘we are in a very fragile state right now’ as they are trying to do their best not to raise prices, but will have to. We got our first invoice yesterday with the added tariff. Us being a brick and mortar retailer cannot suck it up, as we have lots more overhead and expenses than the online only folks. This could make or break a lot of companies and manufacturers, as I guarantee that these price hikes will not go away.

 

[Barison82]

Yes retailers like us are in a very precarious state right now. As one distributor told me on the phone the other day, ‘we are in a very fragile state right now’ as they are trying to do their best not to raise prices, but will have to. We got our first invoice yesterday with the added tariff. Us being a brick and mortar retailer cannot suck it up, as we have lots more overhead and expenses than the online only folks. This could make or break a lot of companies and manufacturers, as I guarantee that these price hikes will not go away.

That’s a really sad story to hear, I’m so sorry for all of you guys, honestly. You can see I’ve been wasting my energy trying to unpick all this BS. It’s just an absolute joke - screwing over ordinary folk and small businesses especially. This will cause untold amounts of damage I’m sure, and it’s all so unnecessary. More instability in an already unstable world, great just what everybody needs. Really bringing us together nicely in an atmosphere of total meanness, coldness and spite. I’d better stop there. Really hope you can make it through…best wishes

 

[squatchys_diecast_hangar]

That’s a really sad story to hear, I’m so sorry for all of you guys, honestly. You can see I’ve been wasting my energy trying to unpick all this BS. It’s just an absolute joke - screwing over ordinary folk and small businesses especially. This will cause untold amounts of damage I’m sure, and it’s all so unnecessary. More instability in an already unstable world, great just what everybody needs. Really bringing us together nicely in an atmosphere of total meanness, coldness and spite. I’d better stop there. Really hope you can make it through…best wishes

We hope everyone pulls through as again it will put folks that were already running close to the edge, most likely over the top or out of the retailing business. We aren't going anywhere unless it just dries up completely as a hobby. We will have to go along with the trend and have to adjust prices accordingly. It will be interesting to see how this affects niche hobbies like ours.

 

[Barison82]

We hope everyone pulls through as again it will put folks that were already running close to the edge, most likely over the top or out of the retailing business. We aren't going anywhere unless it just dries up completely as a hobby. We will have to go along with the trend and have to adjust prices accordingly. It will be interesting to see how this affects niche hobbies like ours.

It won’t affect the hobby in a positive way that’s for sure

 

[pedrominiaturas]

I am going to give my opinion on this matter. Brazil has a 60% duty + state tax (22% over CIF plus duty) for small shipment coming in by courier or mail. It has been like that in the past 50 years, and during 1970-1990 there was a ban on imports. The ban was lifted in 1991.
For business is possible to pay a bit less on container and airfreight imports but on large shipments, which is unfeasible for diecast.

Until last year, courier would charge this normally and mail was sometimes charged and sometimes exempted depending on the seller outside Brazil declaring lower values. Due to the fact that mail had a great possibily of having exempted, lots of small imports were made by individuals and not business. Business could hide from it and had to pay everything.

This high import fees are in place to protect the industry in Brazil but it didnt work out. Chinese products are still better and cheaper even with taxes. Thats what the government says at least. The truth is that they want more and more money to spend.

Those who really believe that duties over imports are good, I can tell you. It is not. It will kill small business and make products a lot more expensive like here in Brazil. A 1/200 widebody is more than double than what it costs in US.

Some products are even unfeasible in some cases.

 

[squatchys_diecast_hangar]

I am going to give my opinion on this matter. Brazil has a 60% duty + state tax (22% over CIF plus duty) for small shipment coming in by courier or mail. It has been like that in the past 50 years, and during 1970-1990 there was a ban on imports. The ban was lifted in 1991.
For business is possible to pay a bit less on container and airfreight imports but on large shipments, which is unfeasible for diecast.

Until last year, courier would charge this normally and mail was sometimes charged and sometimes exempted depending on the seller outside Brazil declaring lower values. Due to the fact that mail had a great possibily of having exempted, lots of small imports were made by individuals and not business. Business could hide from it and had to pay everything.

This high import fees are in place to protect the industry in Brazil but it didnt work out. Chinese products are still better and cheaper even with taxes. Thats what the government says at least. The truth is that they want more and more money to spend.

Those who really believe that duties over imports are good, I can tell you. It is not. It will kill small business and make products a lot more expensive like here in Brazil. A 1/200 widebody is more than double than what it costs in US.

Some products are even unfeasible in some cases.

The true measure will be next month if the tariffs stick and both countries don’t back down. If the tariffs are truly at 125%, and those costs are passed on to retailers in the US, it will effectively kill off the hobby in the US. It would hypothetically price a new release from say $45 to over $90. That will be the end of it, again if the costs aren’t absorbed by distribution. But a good deal of us get direct so that would be an absorbion that most can’t suck up. It would be passed on to the consumer.

 

[Jazajia]

The true measure will be next month if the tariffs stick and both countries don’t back down. If the tariffs are truly at 125%, and those costs are passed on to retailers in the US, it will effectively kill off the hobby in the US. It would hypothetically price a new release from say $45 to over $90. That will be the end of it, again if the costs aren’t absorbed by distribution. But a good deal of us get direct so that would be an absorbion that most can’t suck up. It would be passed on to the consumer.

I was going to message you, but you already answered what I was going to ask you. So far, the situation has been manageable, and by the time the next shipments arrive, the policies might have already changed. But yeah, if model prices effectively go up 134%, it's over. Obviously, there might still be some people willing to pay those prices, but not enough to support the production numbers required to make it viable for manufacturers.

I know you don't do Pre-Orders, Scott, but I'll tell you an interesting tariff story. Somebody pre-ordered a model from my shop about four months ago (long before the tariffs). This customer also took advantage of every perk I offer as it was a local sale , so a low-margin sale, which is totally fine. But when the model finally arrived, the distributor charged a 15% tariff surcharge. I lost money on that sale.

I have to imagine that every other store is also losing money with pre-orders that locked in a pre-tariff price.

 

[squatchys_diecast_hangar]

I was going to message you, but you already answered what I was going to ask you. So far, the situation has been manageable, and by the time the next shipments arrive, the policies might have already changed. But yeah, if model prices effectively go up 134%, it's over. Obviously, there might still be some people willing to pay those prices, but not enough to support the production numbers required to make it viable for manufacturers.

I know you don't do Pre-Orders, Scott, but I'll tell you an interesting tariff story. Somebody pre-ordered a model from my shop about four months ago (long before the tariffs). This customer also took advantage of every perk I offer as it was a local sale , so a low-margin sale, which is totally fine. But when the model finally arrived, the distributor charged a 15% tariff surcharge. I lost money on that sale.

I have to imagine that every other store is also losing money with pre-orders that locked in a pre-tariff price.

Yes and going forward that will be the case with any and all pre-orders, if they do stay in place, and I don’t see how they won’t at this point. So for this I am glad we don’t do preorders as that will be a nightmare to handle and still stay customer service focused. I am also looking at just retailer pre-orders also. Inflight being the biggie for us. I talked to Don the owner of InFlight when he was here for the Seattle Expo, and he doesn’t know. But for us, I don’t want to be hung out with models that are double the price. I hate it for MTS as they are really going to be in a pickle, especially when I suspect, a lot of online retailers will toss in the towel, and they are stuck with a ton of models that nobody wants. So May will be a very telling month for the US side of the hobby. Which I know the rest of the non US hobbiest say that they don’t feel sorry for us, but I think the realization that these manufacturers rely on US orders to account for a good majority of the business. So if that market goes away, I’m afraid the hobby follows. That’s my opinion, take it for what it’s worth or not. All news reports say that the toy hobby/ market is about to take a major hit, and our tiny, tiny piece of that is going to be in the crosshairs.

 

[Jazajia]

Yes and going forward that will be the case with any and all pre-orders, if they do stay in place, and I don’t see how they won’t at this point. So for this I am glad we don’t do preorders as that will be a nightmare to handle and still stay customer service focused. I am also looking at just retailer pre-orders also. Inflight being the biggie for us. I talked to Don the owner of InFlight when he was here for the Seattle Expo, and he doesn’t know. But for us, I don’t want to be hung out with models that are double the price. I hate it for MTS as they are really going to be in a pickle, especially when I suspect, a lot of online retailers will toss in the towel, and they are stuck with a ton of models that nobody wants. So May will be a very telling month for the US side of the hobby. Which I know the rest of the non US hobbiest say that they don’t feel sorry for us, but I think the realization that these manufacturers rely on US orders to account for a good majority of the business. So if that market goes away, I’m afraid the hobby follows. That’s my opinion, take it for what it’s worth or not. All news reports say that the toy hobby/ market is about to take a major hit, and our tiny, tiny piece of that is going to be in the crosshairs.

I have seen the news putting emphasis on the "toy" industry as one of the ones that are going to suffer the most. I met Don at AMS a few years ago. The story of how he fell in love with the 1:200 stuff that UK builders were selling through CAM and took the idea to China is quite interesting. I think out of the big distributors around here, MTS has been doing an excellent job navigating this uncertain environment. Of course, I don't deal with as many as you do. Each one of us has our "secret sauce." I, for one, have found a lot of oxygen from my coworkers, and through that channel, I have secured a handful of pre-orders for one particular model out of the latest B-Model announcement.

Anyway, I'm glad to hear that I'm not the only one with the same concerns... We shall see and adjust accordingly.

If worst comes to worst, I'll buy a crap load of pre-tariff U.S. stock from our distributors and turn my garage into a custom production line . Oh crap, just gave away my secret sauce recipe...

 

[pommy80]

Toymax, a well known shop in HK, will no longer ship to the US due the tariff's, as per their facebook post.

Toymax Co.　Airplane model shop 創意堡飛機模型專門店: 戰鬥機飛機模型 / 民航機飛機模型

Our apologies to U.S. collectors for the current suspension of order placements. We will resume normal operations once the tariff situation is resolved. Thanks for your understanding.

www.facebook.com

 

[vsr]

Toymax, a well known shop in HK, will no longer ship to the US due the tariff's, as per their facebook post.

Toymax Co.　Airplane model shop 創意堡飛機模型專門店: 戰鬥機飛機模型 / 民航機飛機模型

Our apologies to U.S. collectors for the current suspension of order placements. We will resume normal operations once the tariff situation is resolved. Thanks for your understanding.

www.facebook.com

Yeah I think all postal shipments from HK are on hold now, as well.

I will say, I have several existing pre-orders, and even if the prices go up, I plan to keep them, though I will probably curtail my future spending. As a customer, I’d appreciate transparency from my retailers about this whole situation above anything else. Considering things seem to be changing by the hour at this point, I know that can be very difficult.

Most of my pre-orders are JC Wings, so goodness knows when they’ll ever be released, and if the tariff situation will even be the same then.

 

[Jazajia]

Toymax, a well known shop in HK, will no longer ship to the US due the tariff's, as per their facebook post.

Toymax Co.　Airplane model shop 創意堡飛機模型專門店: 戰鬥機飛機模型 / 民航機飛機模型

Our apologies to U.S. collectors for the current suspension of order placements. We will resume normal operations once the tariff situation is resolved. Thanks for your understanding.

www.facebook.com

I was there not long ago, they had a rather limited stock... I can see the reasoning behind their decision, they probably don't want to deal with packages that are potentially going to get returned once they get here and the customer refuses to pay whatever import charges U.S. customs claim. Again, I can't see why anyone in the U.S. would be ordering from Toy Max.

 

[Jazajia]

Yeah I think all postal shipments from HK are on hold now, as well.

I will say, I have several existing pre-orders, and even if the prices go up, I plan to keep them, though I will probably curtail my future spending. As a customer, I’d appreciate transparency from my retailers about this whole situation above anything else. Considering things seem to be changing by the hour at this point, I know that can be very difficult.

Most of my pre-orders are JC Wings, so goodness knows when they’ll ever be released, and if the tariff situation will even be the same then.

Yup, JC Wings U.S. pre-orders are a particular headache right now. I expect many of those to start getting cancelled if the tariffs hold. Unless U.S. retailers want to start becoming charitable organizations.

Some of us might just let it go and treat them as premature liquidation sales.

 

[pommy80]

I was there not long ago, they had a rather limited stock... I can see the reasoning behind their decision, they probably don't want to deal with packages that are potentially going to get returned once they get here and the customer refuses to pay whatever import charges U.S. customs claim. Again, I can't see why anyone in the U.S. would be ordering from Toy Max.

Yes they mainly order only 1 of each new release, hence why their stock is limited. They do have quite the customer base, but I guess even before the tariffs, only a handful would be shipments to USA.

 

[squatchys_diecast_hangar]

I have seen the news putting emphasis on the "toy" industry as one of the ones that are going to suffer the most. I met Don at AMS a few years ago. The story of how he fell in love with the 1:200 stuff that UK builders were selling through CAM and took the idea to China is quite interesting. I think out of the big distributors around here, MTS has been doing an excellent job navigating this uncertain environment. Of course, I don't deal with as many as you do. Each one of us has our "secret sauce." I, for one, have found a lot of oxygen from my coworkers, and through that channel, I have secured a handful of pre-orders for one particular model out of the latest B-Model announcement.

Anyway, I'm glad to hear that I'm not the only one with the same concerns... We shall see and adjust accordingly.

If worst comes to worst, I'll buy a crap load of pre-tariff U.S. stock from our distributors and turn my garage into a custom production line . Oh crap, just gave away my secret sacude recipe...

Our business model has never been just on new releases, the same with MTS. It was just a small slice of our business. But for most of the others it is, or has been. That will be their demise. Unfortunately, or fortunately for the very few of us who do deal with collections and retail a lot of inventory, it could bolster sales in lieu of the the harsh reality of what’s to seemingly be coming very shortly. Or could be the death of the hobby, it’s really a 50/50 coin toss at this point.
It’s also hard to plan for something we can’t see yet either. Until we get those emails for distributors with cost increases, us as retailers, can’t really tell the global public what it’s going to be. I think this months Gemini releases will sell out quickly for those trying to get under that gun. I have also emailed NG, PHX, JC asking them to ship out quickly so we don’t get stuck with that bill.
So we all kinda wait on pins and needles.

 

[Jazajia]

Our business model has never been just on new releases, the same with MTS. It was just a small slice of our business. But for most of the others it is, or has been. That will be their demise. Unfortunately, or fortunately for the very few of us who do deal with collections and retail a lot of inventory, it could bolster sales in lieu of the the harsh reality of what’s to seemingly be coming very shortly. Or could be the death of the hobby, it’s really a 50/50 coin toss at this point.
It’s also hard to plan for something we can’t see yet either. Until we get those emails for distributors with cost increases, us as retailers, can’t really tell the global public what it’s going to be. I think this months Gemini releases will sell out quickly for those trying to get under that gun. I have also emailed NG, PHX, JC asking them to ship out quickly so we don’t get stuck with that bill.
So we all kinda wait on pins and needles.

Neither is mine... at least not GJ, NG, and all the usual stuff, I mean, there are like 100 guys doing the same. Just in the last month, 3 more have popped up. But I beg to differ, even they have a chance, if they are creative enough. Sounds like you do well with collections, Scott, thanks for sharing some of your recipe .

 

[pedrominiaturas]

The true measure will be next month if the tariffs stick and both countries don’t back down. If the tariffs are truly at 125%, and those costs are passed on to retailers in the US, it will effectively kill off the hobby in the US. It would hypothetically price a new release from say $45 to over $90. That will be the end of it, again if the costs aren’t absorbed by distribution. But a good deal of us get direct so that would be an absorbion that most can’t suck up. It would be passed on to the consumer.

So far distributors have said that they will absorb a small part of the bill and pass the same amount to the retailers. There is no way they can handle like that with bigger tariffs.

I do buy my models directly with no middle man, so I have to handle all my imports and pay UPS a lot of import duties and I do sell directly to customers.

If I get my items from Gemini, I will have to pay the tariff just like you guys because the US government is not exempting this fee on exports of Chinese goods. Most countries do exempt the tariff and sales tax when exporting them.

Tariffs didnt kill the hobby here in Brazil buy made models so expensive that demand is very low compared to US. Salaries are way lower here too.

Someone said that the hobby as whole will suffer because of US demand over models going down. I don't think that this is entirely true. There is still a huge market in China, which will be the focus of Chinese brands. But brands that do a lot of American airlines will suffer a lot. We will see if the US will back down, I dont think China will back down. But that is my opinion.

 

[Phantom]

Someone said that the hobby as whole will suffer because of US demand over models going down. I don't think that this is entirely true. There is still a huge market in China, which will be the focus of Chinese brands. But brands that do a lot of American airlines will suffer a lot.

I'm just a collector in this hobby but I do agree with you. Yes, the US seems to be THE market. However if brands try for more market penetration elsewhere I think there's a way to survive without the US market.
But of course, if this tariffs crap will go on, the world's - and not "just" the US' - economy will go down the drain. This is where I see the real challenge for the hobby - when people just don't have the money anymore.

 

[pedrominiaturas]

I'm just a collector in this hobby but I do agree with you. Yes, the US seems to be THE market. However if brands try for more market penetration elsewhere I think there's a way to survive without the US market.
But of course, if this tariffs crap will go on, the world's - and not "just" the US' - economy will go down the drain. This is where I see the real challenge for the hobby - when people just don't have the money anymore.

The US is a very big market but so China is. Some people might say that the Chinese have less money than US. But they usually pay less on models than everyone because they are in the same place the models are made.

The tariffs will damage everywhere. But some countries will benefit from it. If China keeps rates on soybeans, Brazil will be able to sell the output US normally sells to China. So it a chess game after all.