Critic's Corner

Posted by John Marks (M) on November 20, 2024 at 15:39:11

In Reply to: RE: Bose acquires McIntosh and Sonus faber posted by DAP on November 20, 2024 at 15:10:16

"Predictions are difficult."

"Especially about the future!"

# # #

Sonus Faber's (I prefer to us US Standard Capitalization) bread-and-butter and high-end models are made in the EC. But their low-end stuff is made in China. I do not know what percentage of SF sales the US accounts for. Let alone, what the US split is between EC and PRC.

Whoever Greenlighted that acquisition was flailing around in the wrong job, if he or she did not take into account (and bake into the loaf of the transaction) the following Risks, which are all almost entirely Political:

1) China Invades Taiwan.

Now that SF has US Owners, a Taiwan Invasion would certainly interrupt SF's supply chain, and perhaps even their sales of EC-made loudspeakers into China--depending on how hard the US pushes back. That said, there are competent OEM loudspeaker builders in Indonesia (Sinar Baja) and perhaps also in Vietnam.

2) Trump manages to cancel the agreements that replaced NAFTA.

While none of us were paying attention, Furniture Manufacturing became a $1 Billion a year Growth Industry. In Mexico. Supposedly, much of Ikea's catalog items sold in the US are now manufactured in Mexico.

But if building loudspeaker boxes in Mexico and assembling the crossovers in Canada, and assembling completed speakers in Tennessee or Iowa is no longer a valid business strategy because you have to pay punitive Tariffs on Mexican goods (Did not DJT say 35%???) and Canadian goods, what are your options? Especially if you build in the USA, but your USA-built products are now subject to Retaliatory Tariffs in other countries!!!

3) The US Consumer Economy (and, US Society) Collapses to an extent not seen in 90+ years.

No sane person will bet his life, his goods, and his sacred honor that there is 100% no chance ever, that local police forces will be ordered to use force to keep US Army and National Guard units from rounding up human beings and shipping them off to Concentration Camps.

As I was growing up, I knew four survivors of Nazi Concentration Camps. Two were teachers of mine.

If that worst-case scenario eventuates, whether SF's $750,000 TOTL setup can be bought at the Fire Sale Price of $200,000 might be the least of SF's problems.

Obi-Wan is feeling a Great Disturbance in the Force.

Or, everything will be just plain ducky!!!

john