New Leica US pricing

[dkmoore]

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Since the topic was closed due to political discussion I am starting another thread based on my observations today.

Leica's new pricing doesn't look right to me. At first I thought the 10% across the board made sense but I think Leica made a big mistake and should have eaten more of the increase. Time will tell but I think this will hurt US sales.

Some Highlights:

50 APO - $9,200
28 Lux - $7700
35 Lux - $6100

The M10P at $8k isn't horrible but the original pricing was a good move for Leica in my opinion. My opinion is coming from someone that can afford to pay these new prices but it just doesn't feel right to me. It is also bad timing because the Holidays will be over in a week... Thankfully many of the Leica stores have strengthened their used gear game.

 

[Jeff S]

But I wouldn’t be surprised if the increases enhance pre-holiday US sales. A couple of dealers told me that staff has been crazy busy lately, both fielding customer price confusion/questions and from those seeking products before increases apply.  

One prominent dealer also indicated they would likely increase prices of used gear by similar amounts to protect trade values and maintain new/used price relationships.

Jeff

 

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[dkmoore]

28 minutes ago, Jeff S said:

But I wouldn’t be surprised if the increases enhance pre-holiday US sales. A couple of dealers told me that staff has been crazy busy lately, both fielding customer price confusion/questions and from those seeking products before increases apply.  

One prominent dealer also indicated they would likely increase prices of used gear by similar amounts to protect trade values and maintain new/used price relationships.

Jeff

 

I would agree. I am more worried about Q1-Q3 2020. That is good to hear that the dealers are busy. I like having brick and mortar stores around. The used market should strengthen for sure.

All that said, the economy is strong so my concern may all be for naught. 

[Jeff S]

Plus the Leica crowd, at least for premium items, doesn’t seem to be the most price sensitive bunch, witness the already $8k APO M 50, let alone the Noctilux, etc.  Some might even take advantage of overseas travel and pick up an item or two that way.

But, on the other hand, Leica is clearly sensitive to the changes, as indicated by their holding steady on the Q2 and SL2 pricing, and by trying to do creative pricing on bundles and such.

Jeff

[dkmoore]

SL2 is a good indicator of their price sensitivity as I feel they priced it perfectly. 
 

overall I feel they have been making solid decisions and i for one hope it continues. 
 

maybe less R&D into watches but I can forgive that foible.  

[james.liam]

This has all happened before with non-Leica Store authorized dealers eventually discounting items, negating much of the increase. At least in the US...can't speak for the soon-to-be shrinking EU. 

 

[fotografr]

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This all seems like just yesterday, but Leica have announced a fairly substantial price increase to take effect on April 1, 2021. Interesting choice of a date considering that is April Fool's Day.

Edited March 16, 2021 by fotografr

[wattsy]

It won't just be Leica. Prices will likely be rising significantly for a whole range of goods and services during the next few years.

[fotografr]

2 minutes ago, wattsy said:

It won't just be Leica. Prices will likely be rising significantly for a whole range of goods and services during the next few years.

Have they ever gone the other direction? What do you attribute this to?

Edited March 16, 2021 by fotografr

[wattsy]

17 minutes ago, fotografr said:

Have they ever gone the other direction? What do you attribute this to?

Currency debasement mostly. QE has gone into overdrive during the last 12 months and something eventually has to give.

[logan2z]

5 hours ago, fotografr said:

This all seems like just yesterday, but Leica have announced a fairly substantial price increase to take effect on April 1, 2021. Interesting choice of a date considering that is April Fool's Day.

Yeah, I thought it was a joke when I received the email  

Some of the increases are relatively modest ($100 on most M lenses and film bodies, for example) and some are quite sizable, like $500 on the Q2. 

Just two weeks left to buy at the old prices...

[Kwesi]

Does an expensive item become more desirable when it becomes more expensive?

That is the question.

[RMF]

36 minutes ago, Kwesi said:

Does an expensive item become more desirable when it becomes more expensive?

That is the question.

I’m not an economist, but yes, thats a “veblen” good.... see Rolex, Patek, Richard Mille, and LV as examples. High demand, limited production = increase in price and increases in desirability. The grey market (especially in Rolex's case) compounds the issue.

 

 

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Edited March 17, 2021 by RMF

[Kwesi]

8 hours ago, RMF said:

I’m not an economist, but yes, thats a “veblen” good.... see Rolex, Patek, Richard Mille, and LV as examples. High demand, limited production = increase in price and increases in desirability. The grey market (especially in Rolex's case) compounds the issue.

 

 

.

I'm not implying that Leica sees itself as a purveyor of Veblen goods, but given that this is pretty much an annual event for Leica, maybe they are on to something.

[Alexia]

$500 increase on the Q2 is certainly not great news for me...

[Kwesi]

1 hour ago, Alexia said:

$500 increase on the Q2 is certainly not great news for me...

I suppose the question is "what justifies the price increase"?

[logan2z]

2 hours ago, Kwesi said:

I suppose the question is "what justifies the price increase"?

According to Red Dot Forum:

Like many premium manufacturers, Leica has a history of small, incremental price adjustments to keep pace with inflation, currency fluctuation, and the ever rising cost to produce hand-crafted, high-precision cameras and lenses. Looking at their public statement, you can see that a 10% weakening of the USD is partly to blame, although it’s worth noting that Leica is adjusting prices globally, not just in the US market.

Not to sound too cynical, but my guess is that it's a charge-what-the-market-can-bear increase.

 

Edited March 18, 2021 by logan2z

[Sandokan]

Are these price increases related to the additional taxes imposed by the US on German goods and manufacturers as part of a trade war? 

[Jeff S]

2 hours ago, Sandokan said:

Are these price increases related to the additional taxes imposed by the US on German goods and manufacturers as part of a trade war? 

Those price increases happened in January, 2020...

https://www.reddotforum.com/content/2019/12/leica-price-increase-coming-jan-1-2020/
 

Then, more unrelated increases just recently, possibly due to currency exchange...

https://www.reddotforum.com/content/2021/03/leica-price-increase-coming-april-1-2021/

 

Jeff

 

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Hallo,

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