Price Increases and more to come

guitars4you

Price increases have been a constant discussion point in many recent blogs - From what I can deduce then expect many more changes to the price - Fender today have announced a further price increase, across the board, due in part, to the hidden costs of transport amongst other costs of materials

I read many comments about price increases on FB, with many pointing out that these increases are well above the governments inflation figure - This is  a hugely distorted source of info anyway - Coupled with 'complaints' aimed at the manufactures for putting up their prices 

Timber - Timber prices are amongst the biggest reason we are seeing hefty price increases - Demand and supply are 2 big culprits - Many forest fires and wood destroying insects are now a serious issue - A plague of tiny mountain pine beetles, no bigger than a grain of rice, has already destroyed 15 years of log supplies in British Columbia, and are chewing through forests in Alberta and the Pacific Northwest - Recent import tax tariffs from Canada to the USA on timber of an additional 20% thanks to Mr Trump don't help either - So the likes of Fender are having to pay far more now for their raw maple blanks than previously - Then what many see as hidden costs, have risen - A report in the USA stated that shipping costs of hauling timber from the forest to timber yards has risen 24% - Then add shortages of staff due to the pandemic - Some reports are indicating that timber has risen in price by over 130% in recent years - I've lost the link now, but a colleague of mine was telling me last week how much a sheet of ply wood has gone up by over the last 12/24 months - Remember Fender have now ceased using Ash, certainly for now, due to supply issues, other than on CS models - This supply issue coupled with demand adds to the cost of raw materials

I'm sure many of our luthiers on FB can comment on such issues and what price increases they are seeing

Cost of shipping containers has sky rocketed - pre pandemic and it was around $2000 to rent such a container to ship - Now around $8-10,000 - All such costs will be added to the final price we see once the guitar arrives into stock

Then as per previous blogs from the likes of @sixstringsupplies and @OilCityPickups we are seeing supply delays and rising costs for hardware, materials, electrical parts - Nickel and cold rolled steel prices are all flying through the roof (Iron ore has more than doubled in price in the last 4/5 years - In less than 12 months, the cost of hot rolled steel has risen from just under $450 per ton to over $1180 per ton 

Stevepage

As much as I would like to support the guitar industry (brands, retailers etc) I’ll probably stick to what I have and not look to get anything new for the foreseeable future.

ive been very excited about new guitars being released this year but the prices have shot up where it’s just completely unaffordable for me.

fretmeister

I was saving up for a new bass for a significant birthday, but the price of my target has increased by about £1000 in the last year already, and I expect it to be worse soon.

So I've given up on the idea completely.

terada

Hooray for price increases. 

 

meltedbuzzbox

Nothing will change until people stop paying these prices. It's supply and demand

Whitecat

Lumber prices have shot up over the course of the pandemic because the supply chain underestimated demand - that is easing off now though, so guitar companies who had stockpiles they could eat into probably were able to survive that without too much difficulty.

https://www.nationalmortgagenews.com/news/lumber-prices-fall-from-2021-peak-end-june-at-five-month-low

That certainly has nothing to do with the bug and disease problem though on some of our favourite woods. Some anecdotal things I've noticed about ash -

- Fender said they were gonna stop using it outside the CS, but they are still using it a lot outside the CS (75th Anniversary models, for example, the MIM Ben Gibbard signature Mustang as another... the AO stuff as well, where appropriate, but I think they may have said that "where it's historically accurate they would try to use it" - wonder if a future AO refresh may put pause on that, we'll see!)
- Kauer & K-Line are offering roasted pine as an ash substitute now - exactly what Fender has done on their American Pro II line. You can still get ash from them though, supply is just limited.
- Knaggs charges an extra $3-400 for swamp ash depending on whether you want just the back or the whole body to be made from it now. When they started up a little over a decade ago I think it was a no-charge sub for alder.
- G&L is substituting sugar pine on some finishes that formerly used swamp ash - not all of them, you can still get swamp ash in some colours from the USA stuff and of course in the Custom Shop but if that doesn't point to a constrained supply then I'm not sure what does.

RaymondLin

This will further push the high end guitars into the luxury market if they are not already there 5 years ago

HandwrittenHero

Sad to see the price increases, but it really is the time we live in.

Completely agree on the official inflation figures being bollocks, always has been. Actually had this discussion with my partner a few days ago with last grocery shop making it clear that what we pay there has jumped significantly and it's not the only spend to have gone up.

StefB

Bit of positive news to start the week with.

meltedbuzzbox

HandwrittenHero said:

Sad to see the price increases, but it really is the time we live in.

Completely agree on the official inflation figures being bollocks, always has been. Actually had this discussion with my partner a few days ago with last grocery shop making it clear that what we pay there has jumped significantly and it's not the only spend to have gone up.

A huge correction is on the horizon,  particularly in the USA. You can't print trillions of dollars without devaluation of currency 

guitars4you

Whitecat said:

- Fender said they were gonna stop using it outside the CS, but they are still using it a lot outside the CS (75th Anniversary models, for example, the MIM Ben Gibbard signature Mustang as another... the AO stuff as well, where appropriate, but I think they may have said that "where it's historically accurate they would try to use it" - wonder if a future AO refresh may put pause on that, we'll see!)
- Kauer & K-Line are offering roasted pine as an ash substitute now - exactly what Fender has done on their American Pro II line. You can still get ash from them though, supply is just limited.
- Knaggs charges an extra $3-400 for swamp ash depending on whether you want just the back or the whole body to be made from it now. When they started up a little over a decade ago I think it was a no-charge sub for alder.
- G&L is substituting sugar pine on some finishes that formerly used swamp ash - not all of them, you can still get swamp ash in some colours from the USA stuff and of course in the Custom Shop but if that doesn't point to a constrained supply then I'm not sure what does.

I think the other factor to take into account regarding ash is the 'grading' - Fender will find examples that are to heavy, contain a knot or mineral blemish and even less of a vibrant ring when tapped - So the CS team will get the pick of the better pieces and 'lesser desirable blanks' can be allocated elsewhere - ie no wastage

Plus I dare say they will still come across 'more affordable' planks from time to time, from the timber yards, that they can buy as/when, to be utilised on other models

I don't think it is a case of not available, but more a case of less available, due in part to the disease 

fretmeister

Musicman are partly blaming the price increases on a disease that affects ash in the USA.

Jackobean

Whitecat said:

- Fender said they were gonna stop using it outside the CS, but they are still using it a lot outside the CS (75th Anniversary models, for example, the MIM Ben Gibbard signature Mustang as another... the AO stuff as well, where appropriate, but I think they may have said that "where it's historically accurate they would try to use it" - wonder if a future AO refresh may put pause on that, we'll see!)

Many of Fender's cheaper Ash models (such as the Gibbard, Mary Kaye AO etc.) are now heavily chambered, and I would expect to see more of this approach going forward. 

Adamski

I wonder how far it can be pushed before it becomes completely unsustainable? 

I am lucky enough to have a collection that includes the usual suspects from the various custom shops and I am so thankful I picked them up when I did because right now, there’s no way I could afford the prices being asked by Gibson, Fender and PRS. 

I have a big birthday coming up in two years (40) and I was looking at something else to mark the occasion but I am just priced out. I can’t even afford a regular CU24 as they are the thick end of £4K. 

Whitecat

Jackobean said:

Whitecat said:

- Fender said they were gonna stop using it outside the CS, but they are still using it a lot outside the CS (75th Anniversary models, for example, the MIM Ben Gibbard signature Mustang as another... the AO stuff as well, where appropriate, but I think they may have said that "where it's historically accurate they would try to use it" - wonder if a future AO refresh may put pause on that, we'll see!)

Many of Fender's cheaper Ash models (such as the Gibbard, Mary Kaye AO etc.) are now heavily chambered, and I would expect to see more of this approach going forward. 

The Gibbard is for sure, didn't know they were doing that on the ltd AOs but it does explain why so many of the ones I've seen were super light...

Hottubes

Hasn't the price of Gasoline and Timber gone through the roof in America recently !

Closing pipelines doesn't help, more expensive fuel means everything goes up in price.

It's easy to see why there's a lucrative second hand market, whilst prices keep going up.

Whitecat

Hottubes said:

Hasn't the price of Gasoline and Timber gone through the roof in America recently !

Closing pipelines doesn't help, more expensive fuel means everything goes up in price.

It's easy to see why there's a lucrative second hand market, whilst prices keep going up.

As I mentioned above raw timber prices did go crazy but they are plummeting back down to earth again and are at a five-month low now with signs that they will keep going downwards. The problem was the supply chain underestimated demand during the pandemic, so they weren't processing as much as they should have been.

Hottubes

meltedbuzzbox said:

HandwrittenHero said:

Sad to see the price increases, but it really is the time we live in.

Completely agree on the official inflation figures being bollocks, always has been. Actually had this discussion with my partner a few days ago with last grocery shop making it clear that what we pay there has jumped significantly and it's not the only spend to have gone up.

A huge correction is on the horizon,  particularly in the USA. You can't print trillions of dollars without devaluation of currency 

Correct! Didn't they spend $300,000 to see if Japanese Quail are more sexually promiscuous on Cocaine. More like Hunters stash.

TrentGuitars

To give you some real world numbers from my cabinetmaking business, my brother and I use a lot of Birch plywood in our shop fitting work and the price has risen from £34+vat in January to £67+vat now, with our supplier expecting a 10% rise every few weeks.

The explanation given is the states ordered huge quantities of it earlier this year after expecting a shortage. Birch plywood is only made in mills in Europe and Russia, so they were quickly had stocks run down and sold at a higher price to the states. So we are now in a situation where the distributors will buy from the mills at any price, ie. they can command whatever price they like as demand is so high and supply is so low. 

They expect this to level off in the autumn, it’s currently making costing out big jobs much much harder as prices can rise so quickly.

With my guitar making, I’m hoping I can insulate my customers from the price rises as they don’t seem to be as extreme in solid wood as they are with plywood.

RaymondLin

I don't think there is a ceiling as there are people out there with money.  At some point, if we are not there already, people just buy guitars because they are expensive as opposed to they are better instruments.  The same crowd to buys Murphy Labs will not really think twice if the next one is £1k more than last year.

The crowd that are buying MIM Fender will continue to buy MIM Fender, they just have to buy used instead.  The ones who buy had the budget for a USA Fender might have to settle for a MIM one.

At the higher end though, nothing much will change.

chris78

I've mentioned before but the model of guitar shops is moving more towards finance as happened with cars.
A £4k guitar is a very significant purchase for most. 
£166 per month on 2 years interest free, much less so