ML Production moving

[User211]

Manufacture and assembly of anything will generaly move to the lowest cost point, where ever that happens to be. It is just good business sense/cents. It has been going on for decades and it will continue in the future.

Keeping all other corporate functions at a particular location is what makes a company what it is. The intellectual capital is what makes a company what it is and more importantly where it is.

Good post Joe.

The problem with this attitude is that by exporting manufacturing, you are exporting intellectual capital.

The danger is that you don't realise that you are doing so.

Copies can be made without true understanding of the concepts involved in a particular product. But eventually, the manufacturing "inheritors" will understand the product. And from true understanding comes the ability to design.

Hence the rise of China... and the guaranteed continued rise.

 

[Bernard]

Copies can be made without true understanding of the concepts involved in a particular product. But eventually, the manufacturing "inheritors" will understand the product. And from true understanding comes the ability to design.

Hence the rise of China... and the guaranteed continued rise.

Yes, but Canada is hardly China.

 

[User211]

Yes, but Canada is hardly China.

No - but you see the bigger picture, Bernard.

Tis interesting to see Joe's more worldly view, contrasted with the much more hardcore Amercian reaction of Gordon's.

 

[Bernard]

No - but you see the bigger picture, Bernard.

Agreed, but not valid in this context.

 

[risabet]

Check out this DuPont website for info re: the coefficient of expansion, both thermal and hygroscopic as these are the pertinent coefficients regarding stretch. Based on a quick calculation, loss of tension isn't the problem to worry about. I'd say contamination and loss of dielectric are much greater concerns.

http://usa.dupontteijinfilms.com/informationcenter/downloads/Physical_&_Thermal_Properties.pdf

 

[JMAUSGP]

Good post Joe.

The problem with this attitude is that by exporting manufacturing, you are exporting intellectual capital.

The danger is that you don't realise that you are doing so.

Copies can be made without true understanding of the concepts involved in a particular product. But eventually, the manufacturing "inheritors" will understand the product. And from true understanding comes the ability to design.

Hence the rise of China... and the guaranteed continued rise.

Justin,

Although I agree that some intellectual capital may escape with manufacturing expertise, I have seen first hand that the Chinese don't have a clue on how to manufacture an item to engineering spec. And have you noticed that neither China or Japan have been able to duplicate computer software systems like unix, or Windows. Yes they can copy hardware but software design is something that has eluded them. Japan even spent billions trying to create the first all Asian operating system, 20 years and billions later it still doesn't work. Why, I am not sure. Maybe their alphabet confuses the computers.

But back to the thread. I find today that I no longer buy Chinese if I have an alternative, even if it is more expensive and almost always it is, but quality should cost more up front but in the long run it is less expensive because it actually works to spec and it lasts longer and in most cases does a better job.

Last year I bought and rode a Chinese clone scooter and only traveled 20 feet before it broke in half. I fell to the ground and got some pretty serious scars from that experience. Later we found they had used a spot weld on the frame and used 1/2 inch tubing for the frame when the real mccoy used 1 1/2 inch tubing and a full arc weld. The Chinese can copy the physical output of something but they have a long way to go to understand the engineering and intellectual capital aspect of many if not all of the things they make.

Last but not the least of China's looming problems is the fact that their current manufacturing costs have not taken in to account air, water and land pollution, like the rest of the industrial world. Once these costs are factored in and that is happening now that they have killed the Yangze River and most of their other large waterways, the cost of manufacture will rise rapidly and their cost advantage will shrink quickly. If they take on the full cost of cleaning up the environment that they have poisoned over the last 25 years or so, then I would say their advantage will cease to exist.

I am not so convinced of China's continued rise. Oh and there is a good article on what China has done so far to their environment in today's NYT.
http://www.msnbc.msn.com/id/35314879/ns/world_news-the_new_york_times

 

[Gordon Gray]

Good link and interesting reading.

Thanks.

GG

 

[Scumurculum]

Justin,

Although I agree that some intellectual capital may escape with manufacturing expertise, I have seen first hand that the Chinese don't have a clue on how to manufacture an item to engineering spec. And have you noticed that neither China or Japan have been able to duplicate computer software systems like unix, or Windows. Yes they can copy hardware but software design is something that has eluded them. Japan even spent billions trying to create the first all Asian operating system, 20 years and billions later it still doesn't work. Why, I am not sure. Maybe their alphabet confuses the computers.

But back to the thread. I find today that I no longer buy Chinese if I have an alternative, even if it is more expensive and almost always it is, but quality should cost more up front but in the long run it is less expensive because it actually works to spec and it lasts longer and in most cases does a better job.

Last year I bought and rode a Chinese clone scooter and only traveled 20 feet before it broke in half. I fell to the ground and got some pretty serious scars from that experience. Later we found they had used a spot weld on the frame and used 1/2 inch tubing for the frame when the real mccoy used 1 1/2 inch tubing and a full arc weld. The Chinese can copy the physical output of something but they have a long way to go to understand the engineering and intellectual capital aspect of many if not all of the things they make.

Last but not the least of China's looming problems is the fact that their current manufacturing costs have not taken in to account air, water and land pollution, like the rest of the industrial world. Once these costs are factored in and that is happening now that they have killed the Yangze River and most of their other large waterways, the cost of manufacture will rise rapidly and their cost advantage will shrink quickly. If they take on the full cost of cleaning up the environment that they have poisoned over the last 25 years or so, then I would say their advantage will cease to exist.

I am not so convinced of China's continued rise. Oh and there is a good article on what China has done so far to their environment in today's NYT.
http://www.msnbc.msn.com/id/35314879...new_york_times

Yes of course those yellow people aren't as good as us and we westerners have such a good enviromental history ourselves....sheesh

 

[Irishtom]

Who cares about increased sales, OR increased profit. Sony makes more sales and profit than ML - is that what we want?

What's important is what ML's owners want. Besides, I already have what I want, a pair of ML speakers. I doubt I'll ever buy another pair regardless of where they're made.

 

[Irishtom]

. I tthink I am pretty sure all of you would like nothing more than to see ML prosper and keep producing the Worlds Best Speakers.:music:

I dunno, doesn't mean much to me one way or the other. I have the product and use it but I don't feel any emotional connection to the company. I doubt they feel such a connection to me either.

Companies come and go; I have a feeling this one is starting to go.

 

[Rich]

What's important is what ML's owners want.

I disagree. What's important is what ML's loyal customers want. Without brand recognition provided by a loyal customer base, they will go downhill very quickly.

I dunno, doesn't mean much to me one way or the other. I have the product and use it but I don't feel any emotional connection to the company.

Then why do you bother hanging out at a forum dedicated to the brand?

 

[Irishtom]

Then why do you bother hanging out at a forum dedicated to the brand?

I don't hang out here; this site is no fun at all. I looked in here because a friend told me ML production was leaving the country and I found that of interest. You seem to think that an interest in using a device means one has an emotional interest in the company that makes it and that's not true.

 

[Gordon Gray]

This thread is going south.

 

[aliveatfive]

I, for one, have always valued a company's reputation in the marketplace. To me, that has a great deal to do with brand loyalty. If a product works as advertised and one has a positive experience with it, I (and others) have a tendency to purchase from the same manufacturer again. Two rather recent developments have eroded my opinion of ML.
First, I was disappointed that my original Summits would not be able to be upgraded to the Summit X. At the time of purchase, I thought that I was buying something which would hold its value in the marketplace in the event that I wished to trade it for something better. It seems to me that the best you can get for a pair of good-condition, used Summits is about 4 grand today. I'll be taking at least a $7,000 hit on a trade. Percentage-wise, I did much better when I traded my Ascent is for the Summits.
Second involves the news of ML's production leaving the US. I own Paradigm speakers and Bryston electronics (both Canadian) and like them both. But ML's marketing made a big deal out of this "heartland" stuff and then proceeded in a different direction.
At one time I believed I would not purchase speakers made by any other company. I'm fairly certain that my next purchase will be speakers made by someone else.

 

[FISH_MAN]

I understand that people often like to upgrade that's why I loved it when tweeter was in biz they gave you FULL credit within one year to jump up to the next level I am not sure how this worked out in the end for Logan or Tweeter but I know I liked it just remember when you buy a car it's a lot more than a pair of summits and every year they come out with "the next best thing" .just remember one thing most of the people who buy these speakers probably are not on this website and are probably very wealthy and just want good sound they probably don't even know where the speakers are made to begin with or weather a summit x is better than a summit nor do they care they probably have better things to do like taking their boat out on the lake or something. my point is that I would think a huge part of logans biz could care less about all of this.

 

[Double D]

This thread is going south.

SOUTH ?? Mexico ? Brazil ?? how far south .. :ROFL:

 

[JMAUSGP]

Yes of course those yellow people aren't as good as us and we westerners have such a good enviromental history ourselves....sheesh

And your point?

I take it you did not like my alphabet joke, don't take everything you read so seriously, especially on a world changing forum such as the MLOC.

My point was specific to my experiences with Chinese manufacturing. And my experiences with Chinese manufacturing have brought me close to death more than once, too close for my comfort and because of that and several other poor product experiences, I no longer trust products manufactured in China and as a result I do not buy them if I have an alternative. Don't read any more into it than that because it is what it is.

Actually, I find your comment a little bit offensive and I don't think I said anything like that. I merely made a small and what I thought was an innocuous alphabet joke and then got back on OT with a good economic discussion on why the Chinese manufacturing costs have up til now been disengenuous when it comes to covering pollution costs.

I did not say that everyone else should not trust them and if you have good experiences with Chinese manufacturering then I am happy for you.

As for pollution, I am guessing by your response you didn't even read the NYT article about China and their pollution woes. I didn't degrade china because of pollution, I simply pointed out that their manufacturing costs have so far not taken pollution into account and when it does they will in effect lose much if not all of the their economic advantage in covering their manufacturing costs. A purely economic argument, nothing more.

If on the other hand someone else feels that Scumurculums quote was an accurate depiction of my argument, well then I apologize as that was not my intent and I would clearly liked to distance myself from Scumurculums quote.

You see my niece is 100% Chinese and as far as I can tell she is way above spec. both smarter and better than I.

 

[JMAUSGP]

I don't hang out here; this site is no fun at all.

Wow, now even strangers are calling me boring and no fun at all. Maybe my wife is right.

Wait a minute, I know for a fact that Bernard, Justin, Jeff, Rich, Dave, et al, can't be no fun at all, they make me laugh and cry on a regular basis here at MLOC, maybe IrishTom is actually one of our wives sent in here to belittle us and get us to not hang out here any more and therebye spend more time shopping for shoes with them.

You know for many people it is true. Porcshe, Ferrari, Viper, Saab, McIntosh, ClearAudio, Oppo, BAT, Spectral, Burmeister, yeah Martin Logan and the list goes on and on. At least some of the People who own products from these companies do take an emotional interest in both the product and the company......I'm just saying.

 

[adanny]

This thread is going south.

To try and veer north a bit....

Living in the current environment, I can give ML the benefit of doubt that the current moves, while unfortunate for those affected, are needed for future sustainability of the company. Demand for luxury goods is unquestionably reducing. Demand for home theatre equipment is down ~20-25% from prior years. I suspect its not going to go up in the coming 3-5 years. I suspect that ML was experiencing squeezing margins even as volumes were going up, and were seeing an environment unlikely to improve.

That said, and without the benefit of any real financial facts about the company (e.g. margins, revenues, personnel costs etc), some suggestions if anyone senior at ML is listening:
1. Expand connections with, and sales to, core customers: Repeat customers and word of mouth is most likely the biggest source of MLs revenue over the years. ML doesnt invest in existing customers as much as other luxury good companies. And frankly no one in high end audio does. I receive ~10 mailings/year from Audi/BMW, a really slick magazine, and invitations to audi owner rallies and speed racing schools in the area. Many of us have spent almost as much on Audio/video as on cars in the last five years, but I dont think ML, Pioneer Elite etc have a clue who their customers REALLY are. Even the damn furniture makers that I have ever bought an ottoman from know more about me as a customer than ML...
2. Protect the ML brand, but make it much more than just about ES sound: Today, ML is synonymous with the best ES sound. But NOT with the sound that most closely resembles the original source, which is a very different branding, and ultimately much more desirable. ML should aspire to be the "Great Speaker Company Bringing Live Sound to your home." Doesnt matter where that speaker company calls home Over time, I could see an ML line that is the best in the world in ES panel speakers. And a second ML line that is the best in the world in box speaker sound. I think ML, Revel and Wilson might be the only brand names that have the history to pull that off. Maybe ML should buy Wilson or YG? Or hire the principals behind YG/Nola to develop that line for ML, under an ML brand... I think ES sound is too niche....
3. Expand globally: Growth in luxury goods sales ain't coming from NA alone. China, India, Brazil, Russia, the middle east, and I daresay even Western Europe are completely unpenetrated by ML (speaking anecdotally here, having traveled to these parts)
4. Quality: Ultimately, this is the one area that ML should never underinvest in. If they can reduce manufacturing cost without even a 1% reduction in quality and reliability, they will be on the right track. If they don't, this will be a bad move in hindsight
5. End-to-end services: Ultimately, what matters the most is the sound in the customers home. Having made difficult to place speakers, ML probably understands that better than most high-end plug-n-play box speaker and electronic houses. They should partner with both room correction companies (e.g. audyssey) and non-electronic room correction companies (e.g. RealTraps) and train their dealers a lot better on this. And possibly offer a "ML Home Audio" service line that helps install the speakers in your house or HT. I would much rather pay $10-20k for installation if it is backed by an ML guarantee and an ML trained Sound Specialist prepares my room, thinks about room correction, associated electronics etc than a run of the mill local dealer. I am not saying that ML short circuit the dealer here btw. This could enhance their relationship with their dealers, help the dealers get more business, part of which would be shared with ML.

thoughts?

 

[Bernard]

My point was specific to my experiences with Chinese manufacturing.

TAS did a piece a while ago on the trials and tribulations of getting high end equipment manufactured in China. It was a horror story. There was stuff like the manufacturer using cheaper capacitors than those specified and pocketing the difference, silkscreening fake part numbers on inferior IC's, etc.