Monday, April 25, 2011

Where Stuff Is Made And When It Matters

OK, I think I've actually figured something out, something big. We're talking, you know, moment of clarity, mind numbing, trumpets blaring, life altering revelation, genuine epiphany kind of stuff. That huge. Maybe right up there with self awareness, independent free will, and the internalization of ones own mortality. It's that big a deal. Really. Or not. You decide.

American icon forever?
It's a simple question really; when does it matter where things are made, and when does it not? Let's be honest, we're all pretty selective about when the specific origins of a given widget rise to the level of even modest concern. Most of the time we're more than willing opt for the seductive combination of availability and low price and call it a day. Moving on, what's for dinner?

But there are those times, and you know exactly what I'm talking about, when it's pitchforks and torches at the castle gate when some cretin threatens to "off-shore" the production of a beloved brand, to violate its very heritage. OK. Why? Why did it matter to us in that particular instance where the damn thing was gonna be built?

Well here's a shocker, maybe because the manufacturer of that very same product told us that it mattered!! Yeah fellow Chromies, it's just that simple, when a company, through it's marketing and advertising strategies specifically tells us, the great unwashed, that where their product is made (and in some cases even how it's made) is an integral part of what makes that very product unique and special, then it matters. Case closed, moving on. We're merely following their lead as it were.

Would you buy a Duc built in Thailand?
Look, when Rolex tells us that their Swiss made watch is a superior timepiece, in large measure because of the fact that it was indeed built in Switzerland by genuine Swiss artisans, we buy the argument, and the watch. A Rolex built in, oh I dunno, Taiwan, is not only most certainly a fake, but it would be an affront to everything Rolex told us they stood for. Unless of course we're one of those cheesy bastards that buy fake crap and tries to pass it off as the real deal. Pathetic.

But it's more than just wistful notions of national pride or feel good sepia toned ads in some enthusiast magazine, we're paying a real premium, as in built into the retail price, for the privilege of purchasing  these finely crafted products. When "where it's made" becomes an integral part of "what it costs", then it bloody well matters, and the manufacturer had better stay true to the "narrative" that they themselves created. To do otherwise is a slight of hand bordering on fraud.

Take Ducati for an example, their former CEO was once quoted as saying that "...the reason Ducati is such a special motorcycle is because of the fact that it was built in Bologna, by Italian craftsman that were passionate about the bikes". Fair enough, I want to believe that, so I do. And I know that the "specialness" of where Ducs are made is a component of the sky high MSRP (OK, that and unionized Italian workers), but I'm good with it. Ducati makes a fine motorcycle, and I can identify with the narrative. Every one's happy. But a Ducati built in Thailand? Is it the same bike, the same brand? I would argue no. Why? Because Ducati told me so.

Triumph, as Brit as a pint?
Globalization of manufacturing is a powerful and compelling force, much like gravity, and we are all subject to its command. Fellow Chromies know that mostly all the major motorcycle manufacturers are public companies, and as such exist for one, and one purpose only, to increase shareholder value (if you answered "build motorcycles" you're new to the Asylum, but stick around you just might learn something). This means they are all trapped on a relentless treadmill of increasing quarterly results, by any means necessary. And sometimes those "means" entail "taking costs out of the system" by reducing manufacturing overhead. And just how do we accomplish that nifty trick? Why we move it to where folks make a whopping five bucks a day and call it good. The math works, sort of.

I say "sort of" because, while product margins are generally increased by utilizing less expensive labor, there's seldom a corresponding reduction in the retail price to the consumer. And shouldn't there be? Take the case of Ducati. Given the words of their own former CEO, one would naturally expect that retails for a Thai built Duc would naturally be less than it's Italian born counterpart...yeah, right. Never happen. When Ducs begin to roll of the line in Thailand, and they're shipped to the US and Europe, which over time they most surely will, look for the retails to stay the same, even though the value proposition of "heritage" has been completely violated in the process. Shameful.

Victory's flirting with Mexican motors causes uproar
The sad fact is most companies will whore out their heritage for as long as they can, because they know that continuing the charade ensures sales and margin. Without it, the value proposition takes a big hit. They'd have to sell 'em cheap. Unfortunately for these companies, the heritage of a brand, its very essence, is a finite resource, and can actually be reduced to zero in the eyes of the consumer. It may take time, but it will happen. You see, we know something that they don't. We know that it really does matter where our motorcycles are made, and who makes them. We know that notions of craftsmanship, pride, passion and connection to a place and brand are very real concepts, and not just themes for a slick ad campaign. They are as real as the metal in the frame of the bike rolling down the assembly line. They make our machines what they are, it's as basic as that.

The fact is Harley Davidson, Victory, Triumph and Ducati have all made "where they're made" a fundamental part of the value of the machines they sell. It's up to them to stay true to the message they themselves crafted and communicated. It's up to us to hold them to it. Or not. We have the ultimate power, we can chose to continue to buy their products, even after a company continually violates its own heritage by reducing itself to nothing more than a licensing and marketing firm. Or we can hold them responsible, we can tell them that they can only go so far, before they go too far. There's a fine line, and it's up to us to let the companies know just where it is.

So can Harley for instance, remain a great American motorcycle company even if at some point those motorcycles are no longer made in America? The answer is an obvious no, at least to us. To us it very much matters that Harley's are US built, and will continue to be so. We willingly pay a premium for that aspect of the HD brand, and would be stupid to do so in the future if it were no longer a part of the value proposition. Harley for it's part continues to remind us that it's product's American heritage and history are what sets it apart from all the others, what makes HD "worth it". And even with Chinese made Harley jackets hanging in my closet, I wanna believe it's true.

I have a message for those iconic motorcycle brands, don't you dare let us down, or better yet, just be honest, when the "where it's made" card ceases to be of value to you, don't continue to tell us it should be of value to us. Deal? Deal.

No comments:

Post a Comment