The Economy.. will hi end audio mfgs lower prices?


.
The state of California just laid off 20,000 employees. National unemployment is at a 30 year high.

Will there be a shake-out in high end audio? Will we continue to see $10k preamps and $30k amps?

According to the article below, prices of most consumer goods, especially big ticket consumer goods are going down.

....copy and paste it into your browser

http://finance.yahoo.com/tech-ticker/article/176714/American-Retail-Goods-On-Sale-Now----and-Forever?tickers=sks,%5Egspc,%5Edji,wmt,jwn,wfmi,cost
.
128x128mitch4t

Showing 2 responses by andr

I’m an outsider, meaning I’m canadian and a used market buyer. My system now consists of 10 k$ units that I bought 25-40% of their original MRSP. All my units were about 4 years old when purchased. Considering the currency exchange rate between our countries and the after tax purchasing power of an average Canadian compared with American, that is the only way I found to finally obtain the dream system in my home.

The present topic brings two questions in my mind :

First, even before the present crisis, isn’t a sign that high end audio is way overpriced when equipment loses 40-60 % of its resale value within 3 or 4 years of its production ? We are talking about equipment that is built with life expectancies of 30 to 40 years with a depreciation factor of its value equivalent to an average car which will last only an average of 10 years.

Second, again without considering the crisis, how many sales would the high end audio industry lose buy turning the catalog every 4 years instead of 18 months ? Why always rebuilding the physical design, at superior cost therefore price to the consumer, when the main purpose of the unit (playing music) is not really improved ? Do first rank buyers of high end audio really renew their equipment every year or two to get the last look design in the listening room ?

In brief, could smaller high end manufacturers survive the turmoil by bringing their prices down and make their units available to more people by cutting in the “redesign” department and keeping in production their most successful units ? Furthermore, could they cut on the marketing expenses and still keep their distribution network alive on the reputation and high quality of their products ?

02-21-09: Kwb
"High End" Manufactures of non-essential products will go out of business before they lower their prices to the point where people without a basic understanding of economics and general business could afford......

I don't agree. If your business is your only way out, what are you prepared to do. Look at Conrad Johnson for instance. They cut down on the number of products they manufacture. They have just introduced a preamp at a lower price with looks reminescent of their 1990 's units.

By the way, both CJ founders were economists before if I recall correctly.