Important information from Kotare for American & Australian customers regards Bf 109K-4

[cbk57]

7 hours ago, blackbetty said:

when the US market breaks away there will be not many more kits made at all, at least in 32nd scale, so no reasen to think it wont affect us outside of the US

nice job!

The tarriff situation will be resolved in months not years.  Here is my bold prediction of the day, the longer tariffs stay in place, the more we see panic from American buyers as goods get more expensive and harder to buy, we will also see a move away from American bonds forcing interest rates up.  The American dollar will continue to weaken, unemployment will go up, gold will continue to go up.  The pressure will force the U.S. to fold or face a major recession.  A simple across the board terriff with targeted tariffs on specific goods would be no problem.  If we put 10% on everything inbound and then higher on things like steel and other select items there would be no issue.  My belief is most countries will string us along on trade negotiations in the belief that our government will be forced to fold.   Anyone watching if they see bond yields going up and gold going up will see we won't be able to take the pressure for long.  Their economics guys will be advising their governments in the same line.  

 

In any event give it a couple months, I don't thing this is going to be a long term issue.  If it is we will have much bigger problems than sourcing our model kits.  

[CRAZY IVAN5]

4 hours ago, cbk57 said:

The tarriff situation will be resolved in months not years.  Here is my bold prediction of the day, the longer tariffs stay in place, the more we see panic from American buyers as goods get more expensive and harder to buy, we will also see a move away from American bonds forcing interest rates up.  The American dollar will continue to weaken, unemployment will go up, gold will continue to go up.  The pressure will force the U.S. to fold or face a major recession.  A simple across the board terriff with targeted tariffs on specific goods would be no problem.  If we put 10% on everything inbound and then higher on things like steel and other select items there would be no issue.  My belief is most countries will string us along on trade negotiations in the belief that our government will be forced to fold.   Anyone watching if they see bond yields going up and gold going up will see we won't be able to take the pressure for long.  Their economics guys will be advising their governments in the same line.  

 

In any event give it a couple months, I don't thing this is going to be a long term issue.  If it is we will have much bigger problems than sourcing our model kits.  

I'm inclined to agree with you on this being "a short term" thing[hopefully].Tariffs historically aren't what one would call "the hot setup" they just don't really work. When "joe sixpack" can't go to Walmart or Target or [fill in the blank] and get this ,that or the other thing/or pay skyrocket high prices and the complaints will get very loud. Then we'll start to see yielding on the Gov't position. The question will then be how much damage will have resulted. It's a fine mess isn't it.

[Model_Monkey]

As a US-based aftermarket vendor, here are some thoughts based on our current experience.

 

1. Regarding our products exported to customers overseas, we typically see one or two customers per year decline to pay their government's import taxes such as VAT or GST and the package we sent gets returned to us.  This past week, we received 6 returns from various customs officials in Europe. This is extremely unusual.  From a production perspective, it is also extremely disruptive and costly to produce products for customers who then decline to accept them, even if the refusal reason is completely understandable and justified.

 

2. Regarding buying the materials we need to produce our products, everything we use to make our products comes from China.  All of our 3D-printers, their repair parts, the consumables the printers use to operate like resin vat film, the resin itself, all of the packing materials, the software we use, even the labels we put on the boxes and the 2D printer ink that marks the labels all comes from China.  All of it.

We get everything from China because that has been arguably the best, most economical source of high quality, affordable 3D printers, resins, repair parts, consumables and packing materials.  There are many reasons we don't buy 3D printers from US companies.  Most importantly, there just aren't many US manufacturers that exist at all.  The few US companies that do exist typically outsource printer and resin production to, you guessed it, China.  The company may be headquartered outside of Boston, but the machines and resins are actually made in China.  High quality, affordable printers and resins just aren't made here in the US.

 

We can shift packaging material sourcing elsewhere (at increased cost) but little else.  We have seen some indications that the resin we use may no longer be shipped to the US from the factory in China.  This means that we are going to have to make some tough decisions.  We are scrambling now to find alternate sources of quality, affordable resin. When we find a potential resin replacement, the resin has to be iteratively tested to determine correct printer settings for that resin which takes time, often many days. We recently tested resin manufactured in Taiwan and found it unacceptable. 

 

Increased material and production costs means that current pricing is not sustainable and will likely have to be raised yet again this year.  We raised prices slightly in January and may have to do it again this month, significantly so, assuming we can even find suitable resin supply alternatives and that our existing 3D printers continue to function well.
 

These issues are already badly impacting our operations and production costs.  Chaotic supply indicators at this time suggest these conditions will worsen for the foreseeable future.

Call me "Debbie Downer" but this is the new reality we are working in.

We sincerely appreciate the patronage of our customers at this difficult time and wish fellow vendors all the best.

Just my 2 cents.

Edited May 1 by Model_Monkey

[mozart]

That’s a very sobering assessment Steve, thanks for the insight. 

[Archimedes]

7 hours ago, cbk57 said:

The tarriff situation will be resolved in months not years.  Here is my bold prediction of the day, the longer tariffs stay in place, the more we see panic from American buyers as goods get more expensive and harder to buy, we will also see a move away from American bonds forcing interest rates up.  The American dollar will continue to weaken, unemployment will go up, gold will continue to go up.  The pressure will force the U.S. to fold or face a major recession.  A simple across the board terriff with targeted tariffs on specific goods would be no problem.  If we put 10% on everything inbound and then higher on things like steel and other select items there would be no issue.  My belief is most countries will string us along on trade negotiations in the belief that our government will be forced to fold.   Anyone watching if they see bond yields going up and gold going up will see we won't be able to take the pressure for long.  Their economics guys will be advising their governments in the same line.  

 

In any event give it a couple months, I don't thing this is going to be a long term issue.  If it is we will have much bigger problems than sourcing our model kits.  

Economic data shows that China exports somewhere between 12 -14% of its total exports to the USA per annum. If the current situation does go longer term (and I recognise your assessment is probably a fair take on the outcome), a drop in exports to the USA will hurt China but it is not fatal to them. In other words, they may be able to tolerate the tariffs for far longer than the USA may be likely to. 

1 hour ago, Model_Monkey said:

As a US-based aftermarket vendor, here are some thoughts based on our current experience.

 

1. Regarding our products exported to customers overseas, we typically see one or two customers per year decline to pay their government's import taxes such as VAT or GST and the package we sent gets returned to us.  This past week, we received 6 returns from various customs officials in Europe. This is extremely unusual.  From a production perspective, it is also extremely disruptive and costly to produce products for customers who then decline to accept them, even if the refusal reason is completely understandable and justified.

 

2. Regarding buying the materials we need to produce our products, everything we use to make our products comes from China.  All of our 3D-printers, their repair parts, the consumables the printers use to operate like resin vat film, the resin itself, all of the packing materials, the software we use, even the labels we put on the boxes and the 2D printer ink that marks the labels all comes from China.  All of it.

We get everything from China because that has been arguably the best, most economical source of high quality, affordable 3D printers, resins, repair parts, consumables and packing materials.  There are many reasons we don't buy 3D printers from US companies.  Most importantly, there just aren't many US manufacturers that exist at all.  The few US companies that do exist typically outsource printer and resin production to, you guessed it, China.  The company may be headquartered outside of Boston, but the machines and resins are actually made in China.  High quality, affordable printers and resins just aren't made here in the US.

 

We can shift packaging material sourcing elsewhere (at increased cost) but little else.  We have seen some indications that the resin we use may no longer be shipped to the US from the factory in China.  This means that we are going to have to make some tough decisions.  We are scrambling now to find alternate sources of quality, affordable resin. When we find a potential resin replacement, the resin has to be iteratively tested to determine correct printer settings for that resin which takes time, often many days. We recently tested resin manufactured in Taiwan and found it unacceptable. 

 

Increased material and production costs means that current pricing is not sustainable and will likely have to be raised yet again this year.  We raised prices slightly in January and may have to do it again this month, significantly so, assuming we can even find suitable resin supply alternatives and that our existing 3D printers continue to function well.
 

These issues are already badly impacting our operations and production costs.  Chaotic supply indicators at this time suggest these conditions will worsen for the foreseeable future.

Call me "Debbie Downer" but this is the new reality we are working in.

We sincerely appreciate the patronage of our customers at this difficult time and wish fellow vendors all the best.

Just my 2 cents.

I am deeply saddened to read all of that. I think Model Monkey is doing stellar work and I hope your company can weather this. 

 

Kind regards,

Paul

[Aptivaboy]

Not trying to be political, but there is a simple solution to all of this: reciprocal ZERO tariffs. I actually believe that is the current administration's end goal. Foreign commentators and some foreign leaders have discussed this at length, not the ones you normally see on US TV. Trump himself has mentioned this several times referencing fair trade, as opposed to free trade. I don't believe these tariffs will remain long term. My prediction is that they'll largely be gone by the end of the summer. Look at China, whose factory utilization is now at a ten year low. They can't sustain that indefinitely, with the new Chinese middle class desiring the ability to afford cars, homes and all of the accoutrements of modern life. A deal will have to be made. When foreign countries eliminate tariffs on US goods, the USA will do the same - total trade equality. Once that occurs, our ability to easily and cheaply order our favorite hobby kits and supplies will return.  It's just a question of when, and how much economic dislocation will occur in the interim - that's the real elephant in the room, how much pain will there be in the short run.

 

Again, it isn't my intention to be political. Like Model Monkey, I'm simply offering my assessment. Having said that, I'm also a believer in hedging my bets, so I'm preordering some Kotare kits this evening. Momma didn't raise no dummy!

 

 

Bob

 

 

PS. I have to get back to the Intrepid bridge you printed for me. The Decrepit will sail this summer!

 

[LSP_Mike]

So Bob, a 1/350 Intrepid? Which ship are you building?

[MikeMaben]

2 hours ago, Aptivaboy said:

... there is a simple solution to all of this: reciprocal ZERO tariffs. I actually believe that is the current administration's end goal. Foreign commentators and some foreign leaders have discussed this at length, not the ones you normally see on US TV. Trump himself has mentioned this several times referencing fair trade, as opposed to free trade.

Agreed,  looks like a game of chicken. 

[Aptivaboy]

So Bob, a 1/350 Intrepid? Which ship are you building?

 

A 1/700th 1944 Intrepid, actually. Model Monkey did the island, and I was able to snag a Nautilus Models wooden deck. Seeing as how my a**hole former principal screwed me over and denied me a summer school job (I'm a teacher) I should have plenty of time to work on her, and a few other projects. Dude was literally fired from his job for rank incompetence, but still has a make-work job downtown. His shadow looms large. Sigh... Looks like I'll have a summer off for the first time in almost 20 years.

 

Edited May 2 by Aptivaboy

[CRAZY IVAN5]

54 minutes ago, MikeMaben said:

Agreed,  looks like a game of chicken. 

Agreed ,The question is who's going to blink first and say "I'm your huckleberry"? Zero tariffs would be a daisy.

[LSP_Ray]

What will be interesting is what the negotiations will do with the Brit/EU VAT's. It was mentioned at least by someone - don't remember who - in the Trump administration. Basically, VAT is a tariff, too. Would be nice if they were negotiated out for you European guys.

 

I am going to be the Guinea pig for you guys. I just pulled the trigger for HLJ to ship an order to me, including the just released Gecko Models 1/16th early Panzer II a,b,c, so we will see how the tariffs work on that.

[thierry laurent]

Indeed Ray. VAT is a PITA and not even the only problem. Each time a parcel is arriving from UK or the US with aftermarket goodies, here we have to pay 20€ for the postmen doing the customs work (it goes to 40 if the value is over 100 and this goes on...!), a possible import fee (I never succeeded in finding how this is calculated but hopefully it is low) plus 21% of VAT over the parcel value, the post and packing and the customs work...Go figure... Useless to say the final cut may finally double the global cost... What really pissed me off is the fact this system was extended to ALL parcels included low value ones to protect our economy against unfair trade (think China) but I'm never paying taxes for anything I'm ordering occasionally from China!?! Practically this applies to me to other western countries, Japan or Taiwan! Last, customs are quite often doing a crappy work... 'forgetting' that the book VAT is 6%, not 21% or that the EU signed a special agreement with Ukraine covering also model kits and meaning that we should not pay anything when getting directly goodies from that country ! So this asks for caution, some red tape and patience to avoid being regularly ripped off... Crazy system...

[Kenneth]

Whether EU VAT is a tariff or not is open to interpretation, as in a given EU country, VAT is levied on imports as well as on local products/services. If I understand it correctly, the US criticism centers on the fact that EU exports are not subject to EU VAT while EU imports are.

[thierry laurent]

23 minutes ago, Kenneth said:

Whether EU VAT is a tariff or not is open to interpretation, as in a given EU country, VAT is levied on imports as well as on local products/services. If I understand it correctly, the US criticism centers on the fact that EU exports are not subject to EU VAT while EU imports are.

Indeed and this is logical as this is a local consuming tax. When I'm buying from Hannants in UK, they remove the local 20% of VAT as I'm not a local consumer. The EU does the same. The big problem is the fact many small producers don't bother or understand the system and ask for a 'single' price. Practically this means you pay the local VAT of the seller's country plus the VAT in your country! Ouch! Consumers in the US have been privileged for many years as everything purchased from the EU was normally VAT-less and they did not get a similar high tax in the US. This goes down to a tax philosophy: either you tax the incomes either you tax the purchases either you tax both! And if you add the cross border issue this does not ease the equation! Finally guys do not complain too much as you do not have the privilege we have in Belgium: being the country with the highest taxes of the universe! 😉

[Tissue and Dope]

but Thierry, you do have Godiva and Leonidas and Mary and Neuhaus and ………… shall I go on?