Silvercivic27

How is it possible that handmade Italian Veloflex tires which are supposedly identical to vittoria Thai-made tires are actually cheaper? I use both and like both but my mind is boggled. Discuss. . .

alexfboyle

Magic...?

RollCNY

Romania

brian416

Checking Ribble, Veloflex tires are $86-106, and Vittoria are $34-76. Seems that Vittoria tubulars are significantly cheaper there.

Silvercivic27

That makes sense. Another "Made in Italy" because the mold release agent was removed in Italy by hand kind of product.

Silvercivic27

That's true. I guess the tubulars are pretty similar, but the clinchers are like $80 vs $60 for normal sites and shops in 'Merica, not those goofy European websites.

halfspeed

It's a common misconception to think that there is a direct relationship between cost and price. Or that there's some sort of formula where price = cost + reasonable profit margin.

rruff

There is a direct relationship in competitive markets... at least for the company as a whole.

There are many reasons why prices are what they are. In this case Veloflex (which I think really are made by Italians) is a small company making high end clinchers and tubulars essentially the same way they were done decades ago... with minimal advertising and R&D. They pay higher salaries but otherwise have low overhead. They probably could not sell their tires for less and still make a profit.

Vittoria is a bigger company with many types of tires and price points. The cheaper tires are by far their highest volume and where they make the most money... even though the margins are smaller. Their hand made high TPI tubulars and clinchers are a fringe part of their business. Since they are paying less for this hand labor, they could probably undercut Veloflex's price... but there is no good reason to. If they were cheaper, the public would view them as inferior... plus they'd start crowding into the prices they have for their other tires.

It is also a major misconception that cheap foreign labor results in huge cost savings, when at the retail level it is typically only a few%.

sdgrannygear

Because veloflex are probably made by chinese/asian immigrants living in Italy, same as italian clothes. It's like saying made in the USA. made by who?

Silvercivic27

I guess there is some truth to this too. I remember when I was younger, I had a discussion with some friends, one of whom worked at Fender guitar company. When another friend stated that the regular strat was better than the squier because it was made in America, my friend who worked at fender said, "Do you want a guitar made with Mexican parts by Mexicans in Mexico or a guitar made with Mexican parts by Mexicans in America?" I loled.

halfspeed

I'm not sure what that means. There are too many inputs into what becomes the price of an item to draw a direct line from cost to price. It's why the retail price of Treks and Cannondales went up when they outsourced production overseas.

Exactly my point.

Don't confuse "cost" and "price".