Originally Posted by Garman
The Confidence 20's should have been just under the 10K mark, especially with cabinets being made in China, it would be nice for a chance to pass along some of that cost savings to the customer, which rarely happens!
In light of Garman's recent comment and several others regarding cabinet manufacture in China I wanted to add another perspective. I have spent many years working in venture capital and private equity and corporate finance and have some thoughts about this manufacturing change to China. My first thought is, I'm sure many people here are share holders in companies either through investment, 401k's, retirement or employee ownership. A company exists solely to generate revenue for it's shareholders. If a company can produce a product with the same quality and performance for a lower manufacturing cost it should. If it can demand the same pricing or more, it should. That is just basic economics. So when Dynaudio starts producing cabinets off-shore to save money (it could be anywhere, the reasons are the same) and does not pass along the savings to the customer, that is the right thing for them to do. Again, because the company exists to provide value to it's shareholder's equity.
Now, here is why we should be HAPPY that Dynaudio is producing it's (some?) of it's cabinetry in China. When Dynaudio was acquired by Goertek in 2014, a Chinese Holding Company of consumer electronics products, it was likely NOT in the best financial position. In my financial experience, when a company is picked up by a holding company or a private equity firm it is because that company is in trouble. It they were making fat margins and struggling to meet the market demand (every thing is awesome!) then there would be no reason to sell to anyone and dilute the value. I have a suspicion that Dynaudio was struggling to remain competitive in the current market where the companies they compete with for business (forget about sound quality and just think about dollars and volume of customers) like ELAC have much larger margins than Dynaudio. It is very likely that Dynaudio could have wound down it business and closed or sold it's brand name because of financial pressures. It makes sense that CEO Lars Prisak would come into leadership at Dynaudio not to generate new products but to either make the company more profitable or to sell it off. Once the purchase was made and the transition completed he retires and his leadership is replaced by 2 Goertek guys, the investor that lead the acquisition of Dynaudio, Peng Peng, and an operations guy, Max Jiang, from Goertek. This is a classic private equity move. Their new jobs were to decrease costs and improve margins while maintaining the brand and performance of the product. This is what we should be most happy about. We could have lost Dynaudio but what we get instead is new products with improved performance. The trade offs are that some cabinets are made in China, Dynaudio has added a line of mass produced bluetooth speakers, etc. and a little loss in exclusivity. The alternative could be much worse. For example Dual was a leading manufacture of turntables, now they make cheap car stereo decks. Even Mark Levinson is now owned by Samsung! With the global economy, some compromises are just a fact of life. Otherwise many "high-end" and "luxury" products might dry up due to low volume demand or everything may become priced out of range for anyone but the 1%'ers.
I do completely agree with the need for transparency so the buyer knows where the products are made, either wholly or impart (like the contents listing on the window of a new car). I just wanted to share this alternate way of looking at it without any disrespect to others here and their opinions about Dynaudio's decision to move some of their manufacturing.
It will be a long time before I would be able to afford anything from the new Confidence product line, but in the meantime I am going to continue to love my C1 Platinum's.