When's it gonna end ?

[anlauto]

 

So I built a resto-mod Cuda convertible last year, along with two others for customers, and I've been using the same recipe for all the cars. I'm currently collecting parts for a forth build, an AAR Cuda resto-mod.....but I'm finding the increase in the cost of parts maddening 

All the cars have the same battery tray, battery cable kit and kill switch. Those three items, purchase at Summit Racing in Aug 2021 cost me $301.66 CDN to my door. TODAY the very same three items to my door will cost $405.23 CDN...that's a 34% increase.....Why ? because Russia invaded Ukraine ? Like what the heck ?
How am I supposed to be able to quote future jobs, when the price of items and the cost of shipping is increasing daily ?

 

[anlauto]

More research...
Fuel pump has gone up 18%
Oil pan 14%

[larry4406]

Bid cost plus and show your cards....

[HP2]

...and my 401k is down 15%.

Macroeconomics is even bigger than Russia and Ukraine, but right now they are the most volatile leg on a table that has a few rickety members on it.  It also doesn't help that US politics is highlighting the most extreme ends of both sides of the spectrum these days while ignoring  the majority of everything in the middle. What I think a lot of people forget is that supporting extremes and promoting disruption in too many places at once creates uncertainty that creates volatility that impacts nearly every aspect in life.

The highly complex and interwoven world we live in is still dealing with fallout from a near global shut down of 2020. The slow down in the velocity of everything from raw materials to primary manufacturing, distribution, and final manufacturing and  even inconsistency of demand have create a situation where more money is chasing less product, which is the primary cause of inflation. When will it end, IMO, not soon and it may be even longer if the US Congress can't get their act together and/or if the Chinese get more aggressive about Taiwan.

[worthywads]

The manufacturing model went to Just In Time management at a time when things were running relatively predictably.  Throw in a global shutdown and the entire JIT model crashed and burned hard.  Free market capitalism doesn't always run smoothly, but that's what we must accept, just enjoy that freedom.

[dodj]

Hmmm. They have been saying that inflation has been running 6 to 8%. I haven't noticed inflation being that low on anything.  At least triple that for food. Car parts. LUMBER, and while not important for some..bullets.  None of them are a mere 6-8% more costly.

[69BFan]

Just this week, we found out that our supplier of the white ink used to produce the white stenciling on our reproduction heater hoses has discontinued that particular ink color.  I can see possibly some of the more abstract colors being dropped from what they offer, but no more white, just crazy.  Our choices from them is a soft gray or soft yellow.

So now, we will have to go through the efforts of locating another ink supplier and probably at a higher cost.  We already had to go to a different method of printing the date coded markings on the fuel filters that we offer.  In an effort to control cost and to insure product quality for the artwork needed for projects like the various stencils needed and items like the jacking instruction decals, etc, a much higher quality scanner and printer was purchased to achieve the results we needed.  Finding small Mom and Pop shops willing to do the quality and quantity of the items that we need is getting much more difficult to locate.

The next ten years will be very telling for the hobby.  With ever increasing cost from labor and materials to the parts, at what point does it flatten out?  For the past 20 years, we have been thinking that things would plateau, but almost everyone is busy with orders at the current time.  We are seeing a slow down to a small extent on our end, and unfortunately the prices for the raw materials to finished product continues to increase with no indications of any change.  No true winner in this situation. 

[Brads70]

A year or so ago with  my line of credit my interest payment was about $200 per month, now today with paying off 15K on the  previous balance the interest payment last month was  $480. They have already said to expect another hike in the interest rate. So it's going to get worse, prepare best you can...
I'm pretty lucky in that is all I owe. I suspect very soon we will see many people loosing their houses and bankruptcies a common occurrence. But we all know the banks never lose... They are enjoying insane profits with these interest rates. Karma.....  wait for it. 
Shipping anything these days is nuts, let along big bulky items such as body panels. I enjoy collecting automotive diecasts and have noticed either eBay or seller have gotten quite greedy with shipping costs as I'm certain they are making a large percentage of profits on the excuse of shipping. Eg. I have seen some listings on ebay selling a 1/18 diecast car from the USA and saying shipping is $90 USD to Canada. Then I buy the same car from Europe for cheaper and shipping is about 1/3 the cost. 
I'm really wanting to either move or build a shop but I don't see that happening anytime soon without a lottery win....
On a positive note so far I'm healthy and still get to play with the things I enjoy. I am blessed!

[anlauto]

A year or so ago with  my line of credit my interest payment was about $200 per month, now today with paying off 15K on the  previous balance the interest payment last month was  $480. They have already said to expect another hike in the interest rate. So it's going to get worse, prepare best you can...

I can never understand how raising interest rates is supposed to help stop inflation ?
All I see is people without money like myself, have to pay more to banks, while banks have lots of money and as Brad says, they are just getting richer and richer in the name of "trying to help stop inflation" 

[Dakota]

As I understand it, the theory is that higher interest rates depress consumer spending which then brings demand more in line with the available supply.   Too much of a reduction in demand means producers cut back to the point the economy shrinks.   Historically, 2 successive quarters of decline in output meant a recession was happening. 

That said, I can't say I wish for the "good old days".   The interest rate on my first car loan back in 1981 was 18.5%.  Also had a house mortgage at 15% interest rate at one point.

Locally, we're now seeing a run up in the price of eggs and beef. It's going to be a long year or three before this mess settles down.

[JH27N0B]

Economics 101 boils down to supply and demand.  If demand exceeds supply, costs rise.
The philosophy behind using interest rates hikes and cuts is to reduce demand when prices are rising to put a damper on inflation. That is why the federal reserve and global banking organizations are raising rates currently, to try to curb inflation. But if the economy if faltering, they do the opposite, they cut rates to make borrowing cheaper and hopefully boost the economy by increasing demand from the availability of "cheap money".  Many argue rates were kept too low starting with the tech wreck days around 2000 and 2001, through the Great Recession 2008, 2009 era and up through the Covid outbreak in 2020, and much of the current economic problems today are a hangover from that 20+ very low interest rates binge.
Many question the wisdom of government elected officials passing on so much responsibility for controlling the economy to the fed rather than doing the job as part of the responsibilities voters elected them to do, but that's a subject to argue about on a political forum, I'm just pointing out who sets interest rates and that they do it constantly to try to increase or cut demand, and hopefully answer Alan's question.
I bought a repro 216 fan from Tony's last summer for $235.  In fall a member here posted a wanted ad for a 216 fan, and I said why not get one of Tony's nice repos?
He said he didn't want to pay $345.  I'm thinking what? They aren't $345. But thankfully I checked the website before telling him he's wrong, and me then finding I was the one wrong and getting $5 a dozen eggs in my face (you see what I did there  ), they in fact were $345.
I say were because he posted again a week or so back the fans are now $385!  That's about a 2/3rds increase since last summer!!
So yeah things are seriously out of control. Everyone has their own bogeyman to blame for this, I'll just say IMO the powers to be proved once again they are experts at screwing up a wet dream and leave it at that. We peasants get to deal with the consequences. Hope you enjoyed 2001 to 2020 before the party ended as I think we are at the start of a long hangover.

[anlauto]

What's the story on the fan blades @TONY ? I don't even see them on your website any more 

[JH27N0B]

Gee you're right, the 216 fan is no longer listed on his site!
Well a big THANK YOU to the local guy last summer who was interested in buying my '71 V code and spent hours crawling over every inch of the car. He compiled a list of things wrong with the car, some legitimate some not (like telling me it was missing the power steering cooler, and that was going to be hard to find. I was freaking out because I was sure it had it, but the car was in storage and it was a few weeks before I got out there to confirm it did have the cooler). Then he made me a bottom of the 71 V code price range offer and wouldn't meet in the middle, or even boost his offer a nickel. Between that and me finding out the car I was interested in buying had more "hair" than afghan setter, I had no qualms about turning down his offer!
One thing he pointed out was the car had a five blade fan, instead of the correct 7 blade.  I'm embarrassed to admit in 10 years ownership I'd never noticed that.  So after turning down his offer, I immediately ordered up one of Tony's fans to fix that issue.
Little did I know I bought it just in the nick of time, and that buyer is why! 

[RUNCHARGER]

69Bfan brings up a good point. We've all expected the restoration thing to die off the last 10 years and it hasn't. We've been blessed with being able to buy pretty much anything we've wanted for these cars. However at some point the easy part will be over.
Personally I think in the future we won't see that many more cars restored as per factory anyway. I don't mean to offend anyone and please don't take it that way but the Hemi, Six Pack and even upper level 4 barrel cars have mostly been restored. Those that haven't require too much work to be worthwhile and to be honest there are enough of them in circulation now that we really don't need any more restored. Of course there will be exceptions but for the most part that's where we're at.
I think with this glitch the last few years and the aging of a lot of the vendors/parts restorers we may not get those products/services back now.
The restomod deal will continue partly because you don't need those old parts to complete your car. However the restomod guys will continue to require sheetmetal. So we'll see if the demand is enough to keep those pieces available. No one is going to keep producing parts to stock because they like the cars, it has to be financially feasible.
These crazy freight costs are starting to hurt the hobby as badly as Paint costs and bodyshop costs are too. It's a pretty big nut to crack when freight costs are getting to be such a big percentage of supply costs. Paint costs have been insane for years and a person really has to take them into account if planning to build a car.
So, I think we have been in a changing situation heavily over the last 5-10 years and maybe we didn't realize it until now.
When I briefly sold resto parts a few years ago every single guy restoring a Mopar was doing it with the end goal of selling the car. I find that alarming.

[MoparCarGuy]

Low-cost energy drives the world economy. When your government goes to war against fossil fuels and supply goes down thus increasing energy costs, everything else goes up. The pipe dream of renewable energy sources boils down to one hard fact, solar- and wind-powered energy sources are unreliable when the clouds roll in and the wind diminishes. Now we are being told to buy a "clean" electric vehicle which takes the same emissions output to produce as a normally-aspirated gasoline engine creates after 60,000 miles of use. The death of the car hobby is a future ban on gasoline. It is not if, but when. Hopefully, common sense will prevail.