Quote:
Originally Posted by bsmith0404
Prices getting stupid is an understatement. Go to your local Home Depot or Lowes and buy an 8’ 2x4. Used to be around $2-2.50, now they’re $7. What kind of an impact do you think that is having on the manufacturers? Yet we’ve seen very minimal price increases from them. The RV manufacturers for the most part are eating that cost. I guess cudo’s are due to them for that.
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That brings to light a very important consideration in any manufacturing process, whether it's RV's or washing machines or screws for carburetors.
As the price of materials goes up, the manufacturer has to make a conscious decision where to cut costs or whether to pass the increased cost to build the product on, to the customer. As an example, if Keystone's price last year for the materials/components to build a $30K trailer was 12K, and this year, the price increases to 15K, that's a 3K difference in materials costs. Does Keystone increase the MSRP by 3K or do they try to build more (even if they have problems buying the materials to increase production) or do they reduce the labor component by cutting hours, cutting production lines and increasing output (a direct correlation to quality) or do they go out of business/stop production until the materials availability improves ???
My guess is that every manufacturer in the US is facing the same questions. As we increased our reliance on China, the tradeoff of cheaper offshore production shifted the labor/materials equation. Now that manufacturers are having to pay more for the components that go into a trailer, they have to cut costs in other areas of production or cut profits. If they cut profits, investors will pull their money and invest in other companies where they can make a better profit, so, Keystone, Ford, GM, Tappan, Lippert, (put any manufacturer of US goods here) are all facing the "increased costs vs decreased labor costs" in order to stay in business. Competition is all facing the same situation, so it doesn't do any good to shop Forest River or Grand Designs... They are also paying hundreds/thousands more for the parts to build any trailer they run down the assembly line......
It's going to get "leaner and meaner" before it gets "better"....