Brass: Part III - Supply & Demand

by Bruce Bloch

It was maybe a year ago (actually 1997; this was written in 1998) when I wrote that we might see some decreases in the prices of new brass. Unfortunately, this has not been the case. What we have seen is increasing prices from a number of importers.

Key brought in a number of steam locomotives, including the Southern Pacific MT4s and MT5s, that retailed for over $1,200. These models had originally been announced as being built by Samhongsa, the number one builder in Korea, and retailing for slightly under $900. In fact, the models were not officially built by Samhongsa, but they were up to Samhongsa quality. Key also imported models of the Southern Pacific AC-9 and AM-2 in 1998. Their original model of the AC-9 was built by Samhongsa and retailed for around $1,900 in 1995, but in 1998 Key used an unknown builder and the retail was around $2,500. Understand, however, that the new models do have many more detail parts than the 1995 version.

Key is not the only builder with rising prices. Precision Scale has imported models of the AC-9 and the Southern Pacific F-3, F-4, and F-5 (2-10-2s). I believe this AC-9 was PCS's first articulated locomotive import that retailed for over $2,000; the F's retailed for over $1,500.

Hallmark imported some beautiful models of the Santa Fe Blue Goose, built by Samhongsa, with a retail price of over $1,200. Hallmark imported Samhongsa-built models of the Santa Fe 4-8-4s and the Santa Fe 2-10-4s in 1995 with a retail price of under $1,100; similar imports today would cost around $1,500.

Challenger's prices are also rising. Challenger imported the 49er set around 1994, with a retail price of around $300 per car, but the new California Zephyr set approaches a retail price of $380 per car. However, preliminary retail prices for the new Daylight cars, which are due in May, 1999, are around $375 per car.

Modelers and collectors ask the same question: Are these models worth the price? I believe that everyone has a different answer to the question. Many buyers are obviously being priced out of the market when articulated locomotives that sold for $1,000 are selling for $2,500 today. However, today’s Korean models are more accurate than ever, have many more detail parts, are now almost always painted, and run a lot better.

Finally, there is one other issue to remember: the imported quantity of each model continues to decrease. The production run of a Japanese-built model during the 1970s was quite often around 500 models; Korean models of the 1980s generally around half of that. Key Imports told me that they imported a total of about 100 AC-9s. These 100 models included all of the variations. I seem to remember from Economics 1 that decreasing supply will increase the demand and the price. The Challenger California Zephyr that just arrived in the first week of January, 1999 was limited to 145 sets and was completely sold out by January 31.

The smaller number of imported models is also very apparent on the resale market. Examination of the dealer inventories (via the Internet) and the swap meets shows that most of the models available for resale are the earlier Japanese models from the 1960s and 1970s and the Korean models of the late 1970s. The Korean-built models of the 1980s and 1990s, which all had smaller production runs, are almost never available. I have not seen any listings for a number of Challenger projects that were imported before 1995, such as the Pennsylvania 1937 Broadway Limited or the CB&Q Pioneer Zephyr. A similar observation could be made for the M 10000 (City of Salinas) and the City of Denver, both imported by Overland.

Furthermore, prices for the 1990s Korean-built models are going up. I recently noticed an ad for a W&R articulated locomotive that was imported with a retail price of around $2,200 last year. The seller wanted over $3,200 and he might get it.