Larry is correct - parts costs for all amateur radio manufacturers have
gone up significantly over the past 12 months. Raw materials like copper
and Aluminum have increased in cost by 20-50% over this period. As an
example, our complete K2 enclosure by itself costs $15 more to
manufacture than it did 12 months ago. In addition to basic
supply-demand competition for raw materials by China, India and the
developing world, the impact of the European Community's RoHS
requirement (reduction of hazardous substances) has been huge on all
manufacturers. RoHS primarily covers the tinning of component leads with
lead-free solder, but it also impacts the plating used on basic
hardware, the types of plastics used etc. Ironically the EC has exempted
all automobile battery, medical, telecom and military manufacturers from
this requirement.. (Fortunately the use of regular lead based solder by
individual builders is still OK.)
Elecraft has been 100% committed to converting to RoHS compliant parts
on all of our products, and this has also put upward pressure on our
costs. Many RoHS compliant parts (lead-free solder tinned leads etc.)
have increased 20-40% over their previous prices. Only aggressive
negotiating with our volume suppliers for large quantities of parts has
allowed us to keep it under control. Fortunately we have been successful
in finding RoHS leaded parts for the K2 and our other products. We
planned for this transition over 18 months ago and we put the financial
resources in place then to buy the additional RoHS inventory.
We have been holding off changing prices for over two years in an effort
to see where things settle out. We finally concluded her had to adjust
things last month. In fact, the $30 change on the K2 does not cover our
total increase in costs and our overall percentage margin is slipping in
order to keep it affordable for everyone. We run a tight ship and this
just means that we have to manage it even better as we move forward.
Fortunately sales actually increased after the price change. :-)
If the current component cost trends continue I can see a similar rise
in prices 6 months out. We'll work hard to contain this. Fortunately the
K2, K1 and KX1 still provide the most fun and performance for the dollar
on the ham radio market. :-) We'll keep building them as long as you
keep buying them and telling your friends about us!
73, Eric WA6HHQ
http://www.elecraft.com
Larry Phipps wrote:
As I small manufacturer, I can certainly see where Elecraft is coming
from. Between the orders for my first and second runs of LP-100s, the
price of copper and aluminum have gone up considerably. I am paying 8
and 10% more respectively for my two enclosures on the current run.
I also had to switch to RoHS compliant parts and RoHS processing of
the PCBs and SMT assembly. Shipping costs have increased recently due
to fuel increases. Elecraft is also affected as I am by trying to keep
the bulk of the kits through-hole. As parts suppliers find a smaller
and smaller market for those types of parts, prices creep up.
If my prices increased over this short period of time, I certainly
can't fault Elecraft for raising it's prices after years.
Larry N8LP
Solosko, Robert B (Bob) wrote:
I too have been planning to add some additional options, and of
course, it's disappointing to see a price increase, but let's be
realistic -- it's only a 5% increase - while that could be a hardship
for a few people, the additional $30 is not likely to prevent most
people from purchasing a $600 piece of equipment (especially when you
start adding the cost of all of the options that haven't gone up in
price (yet)). The K2 is still well worth the cost...
Bob W1SRB
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