# RC2 news



## Prisoner (Nov 2, 1999)

Anybody have any insight into what this means as far as AMT/ERTL plastic models is concerned. It sounds like it is primarily focused on diecast but the wording is a little vague.

*"RC2 Reports Lower than Expected 2006 Fourth Quarter and Year-End Preliminary Net Sales; Margins Continue to be Impacted by Increased Die-Cast Product Costs; Company to Focus on Higher Growth Categories; Automotive Collectibles Business Discontinued"*

http://rc2.com/investor/financial/2007/Release_Prelim_Q4_06.pdf


----------



## John P (Sep 1, 1999)

We know two things (there's been much discussion over at Starship Modeler too): 
(1) They're cancelling a lot of die cast lines, which has no effect on plastic models.
(2) They've renewed their Star Wars and Star Trek licenses, but haven't said what they're going to DO with them.

So there's still a possibility they may continue to produce what few Trek models they're currently producing, a slim chance they may reissue some old ST and SW models, and a slimmer chance they may still come up with new ones. But they haven't said, and we don't know.


----------



## terryr (Feb 11, 2001)

A few years ago weren't they cancelling their plastic to focus on diecast?


----------



## irishtrek (Sep 17, 2005)

terryr said:


> A few years ago weren't they cancelling their plastic to focus on diecast?


Go figure.


----------



## Scott Hasty (Jul 10, 2003)

terryr said:


> A few years ago weren't they cancelling their plastic to focus on diecast?


No, that was a rumor. Stop feeding the monster. I've seen no evidence that was a truthful statement, especially considering the number of plastic I saw/see in my LHS from them on a continuous basis.

Scottie


----------



## WarrenS (Feb 16, 2005)

I deal daily with a large hobby wholesaler/dealer, the original word was, as of this Monday AMT, Ertl auto diecast and Racing Champions will no longer be in business.

AMT has not been filling orders for stuff that is already released, stock is dwindling, now they are saying they will be filling some orders, the stuff that is in the state of being produced will be released and they have some ongoing obligations with licensing/Model King. After that, AMT is finished, done, see ya later.


----------



## toyroy (Jul 17, 2005)

It's clear RC2 just bought these brands for their cash flow, and is now throwing them away, like so many used diapers.


----------



## Dave Metzner (Jan 1, 1970)

Everything I'm hearing and reading leads me to believe that RC-2 is looking for a buyer for their Plastic kit assets........
I hope that someone who understands those assets and the markets for those products can step up and make the acquisition! 

Dave


----------



## xsavoie (Jun 29, 1999)

Revell-Monogram seems to be the logical choice.Surely some of their kits would interest them.AMT produces good kits.


----------



## The-Nightsky (May 10, 2005)

Dave Metzner said:


> Everything I'm hearing and reading leads me to believe that RC-2 is looking for a buyer for their Plastic kit assets........
> I hope that someone who understands those assets and the markets for those products can step up and make the acquisition!
> 
> Dave


Tom....Tom....are you reading this.....Is it time for "Round Two"? :wave:


----------



## phrankenstign (Nov 29, 1999)

The-Nightsky said:


> Tom....Tom....are you reading this.....Is it time for "Round Two"? :wave:



Arctic Radiance?


----------



## John P (Sep 1, 1999)

I'm buyin' some extra lottery tickets this week! If PM was only worth $24M when Tom aban --- er, sold it, and the lottery is around $100M ....


----------



## toyroy (Jul 17, 2005)

Does RC2 own the rights to the Aurora name, and indicia?


----------



## The Batman (Mar 21, 2000)

toyroy said:


> Does RC2 own the rights to the Aurora name, and indicia?


No. That would be Cinemodels.... from whom Polar Lights leased it's use of the Logo for a three year period.

- GJS


----------



## spe130 (Apr 13, 2004)

John P said:


> I'm buyin' some extra lottery tickets this week! If PM was only worth $24M when Tom aban --- er, sold it, and the lottery is around $100M ....


And it should be quite a bit under $24M if you're just trying to get the plastic kit business...


----------



## toyroy (Jul 17, 2005)

phrankenstign said:


> Arctic Radiance?


Campy Boomer's Models?


----------



## Prince of Styrene II (Feb 28, 2000)

toyroy said:


> Campy Boomer's Models?


[dreamy] Hmmmm.... I'd like a model of Boomer.... <drool> [/dreamy] :devil:


----------



## irishtrek (Sep 17, 2005)

Dave Metzner said:


> Everything I'm hearing and reading leads me to believe that RC-2 is looking for a buyer for their Plastic kit assets........
> I hope that someone who understands those assets and the markets for those products can step up and make the acquisition!
> 
> Dave


I wonder if my step uncle would be interested seeing he's had his owwn fiberglass buisness since 1963.


----------



## Dave Metzner (Jan 1, 1970)

Who ever decides to jump in better have deep pockets and an exisiting organization with contacts to hobby wholesalers and distributors as well as large direct buying retailers.
Probably need to have some contacts in Bentonville as well.
Also needs to know his way around Hong Kong and the industrial area of China adjacent to HK as that's where production will probably remain!

Not a good opportunity for an investor without experience and contacts in the hobby industry.

Dave


----------



## Roguepink (Sep 18, 2003)

I just don't think I can convince my boss that this is a good opportunity. He has said many times that we are not in the plastic model buisiness. But... look at the composition of many newer Estes kits... hmm?

Contacts in HK and China? Yes
Experience with mass distributors? Yes
Capital to invest? Yes
Contacts in Arkansas? Unlikely.

eh.... I'll mention it to him.


----------



## Roguepink (Sep 18, 2003)

oh... except that he hates liscensing. Especially Star Wars. Almost drove us bankrupt.


----------



## John P (Sep 1, 1999)

I just won the NJ Mega Millions lottery!!




...well, ten bucks worth, anyway. :freak:


----------



## Prince of Styrene II (Feb 28, 2000)

Hmmm... do you think they'd take $10 for a downpayment?


----------



## CaptFrank (Jan 29, 2005)

*John P *wrote:


> I just won the NJ Mega Millions lottery!!
> 
> 
> 
> ...


Lunch is on John!!


Well, 
the fries at McDonalds, at least. :tongue:


----------



## irishtrek (Sep 17, 2005)

Prince of Styrene II said:


> Hmmm... do you think they'd take $10 for a downpayment?


They might take it as payment for the oppertunity to schedule an appointment.


----------



## Zathros (Dec 21, 2000)

Every company has to start somewhere...once established..you MAKE

the connections!:thumbsup:


----------



## MadCap Romanian (Oct 29, 2005)

My wholesaler got word that RC2 Dropped the AMT plastics line as well as the diecast. 

The AMT website confirms this, in a way, because they only list the 1966 Buick Wildcat re-pop as their only model kit for 2007.

I just wonder what they have left.

Seems strange that this would happen since RC2 is one of the largest companies in the hobby world. However, I can see it since they have really done their best to squash anything plastic from their factories. 

That's my 2 cents.

I'm sure the AMT model car molds will come back some day. Afterall, AMT has been bought and sold many times in it's history and it did survive the late 1970's. Funny how it almost seems like the late 1970's for plastic again, doesn't it?

Like AMT and MPC bringing out all the car kits that had uberflash and didn't fit together well, even came with warped frames. Now the mold quality is better, but the subject matter is still in the late 1970's. Who REALLY wants to build a 1977 Ford Mustang? Come on! Really!

Speaking of the 1970's, Revell is bringing out the Baron and the ZZZZZ28. See, we're reliving the 1970's!

Break out your bell bottomS!


----------



## abacero (Oct 24, 2005)

MadCap Romanian said:


> Speaking of the 1970's, Revell is bringing out the Baron and the ZZZZZ28. See, we're reliving the 1970's!
> 
> Break out your bell bottomS!



About revival, AMT released o reissued during 2006 (I think) one of those futuristic cars of the 50's or 60's (the car people knows what I am talking about, I am just a ST guy).

About the future of RC2, since the main topic is AMT, don't forget other doomed brands such as Polar Lights. The hope is that someone could rescue the lost brands and revive actual great products like the Jupiter 2 or the Forbidden Planet ship. There were options for figures, cars, spaceships, a whole world of possibilities, plus projects kept just in paper or, at he most, in prototypes, probably the insiders could tell us the mortals about that.

Anyway, the AMT fate is on the interest and benefit of the entire modelist world. We hope some merciful soul could have mercy of us...

Alberto


----------



## WarrenS (Feb 16, 2005)

Dave Metzner said:


> Who ever decides to jump in better have deep pockets and an exisiting organization with contacts to hobby wholesalers and distributors as well as large direct buying retailers.
> Probably need to have some contacts in Bentonville as well.
> Also needs to know his way around Hong Kong and the industrial area of China adjacent to HK as that's where production will probably remain!
> 
> ...



You forgot: willing to deal with Walmart making 3 cents profit per case of 6.


----------



## razorwyre1 (Jan 28, 2004)

Dave Metzner said:


> Who ever decides to jump in better have deep pockets and an exisiting organization with contacts to hobby wholesalers and distributors as well as large direct buying retailers.
> Probably need to have some contacts in Bentonville as well.
> Also needs to know his way around Hong Kong and the industrial area of China adjacent to HK as that's where production will probably remain!
> 
> ...


thanks for the reality check dave. (its surprising how many people dont "get it" when it comes to jumping into any business. just yesterday i had to explain to a buddy that his best bet is to sell/ license his idea to a manufacturor/distributor already in the particular industry he was considering.)


----------



## John P (Sep 1, 1999)

Well, when I hit the Mega Million lottery, I'll have $150M to play with, so I won't miss five or ten to set up a failing model company that RC2 will buy out some day.


----------



## toyroy (Jul 17, 2005)

abacero said:


> ...About the future of RC2, since the main topic is AMT, don't forget other doomed brands such as Polar Lights. The hope is that someone could rescue the lost brands and revive actual great products like the Jupiter 2 or the Forbidden Planet ship. There were options for figures, cars, spaceships, a whole world of possibilities, plus projects kept just in paper or, at he most, in prototypes, probably the insiders could tell us the mortals about that.
> 
> Anyway, the AMT fate is on the interest and benefit of the entire modelist world. We hope some merciful soul could have mercy of us...


Raiders of the Lost Brands


----------



## terryr (Feb 11, 2001)

All these model compamies are doing poorly, and yet model accessories are doing okay. So what are people using them on?


----------



## irishtrek (Sep 17, 2005)

Linnda Smile over on SSM announced today that RC2 will not renew the license for Trek or Star Wars when they expire at the end of this year.


----------



## Dr. Brad (Oct 5, 1999)

Yeah, saw that earlier today. That might not make us particularly happy (or at least, some of us), but maybe someone else will pick up the license. You never know.


----------



## toyroy (Jul 17, 2005)

irishtrek said:


> Linnda Smile over on SSM announced today that RC2 will not renew the license for Trek or Star Wars when they expire at the end of this year.


There are folks paying $1200 and more for plastic Enterprise models, and RC2 can't figure a way to profit from Star Trek? They must be totally intent on making nothing but diapers.


----------



## irishtrek (Sep 17, 2005)

I wonder if RC2 feels insulted right about now.


----------



## CaptFrank (Jan 29, 2005)

toyroy wrote:


> There are folks paying $1200 and more for plastic Enterprise models, and RC2 can't figure a way to profit from Star Trek?


I believe it's not a question of not being able to profit, but that 
they don't want to. 

RC2 seems to have no interest in STAR TREK plastic model kits.


----------



## SteveR (Aug 7, 2005)

Well, that's a different market: the high-end short-run market. RC2 is mass-market, and sorry boys, Trek model kits aren't very "mass market" any more.

I think the future (present?) of SF modelling lies in garage kits and pre-builts. Injection-molded styrene SF is not long for this world.

But you guys already knew that ...?


----------



## toyroy (Jul 17, 2005)

irishtrek said:


> I wonder if RC2 feels insulted right about now.


They're crying all the way to organically-sustainable profitability.


----------



## toyroy (Jul 17, 2005)

irishtrek said:


> I wonder if RC2 feels insulted right about now.


And, my comment was not intended as an insult. My point is that, apparently, there are still high profits to be made from _Star Trek_. RC2 seems to want to pursue high profits, serving an entirely different market.


----------



## Dave Metzner (Jan 1, 1970)

RC-2 is a big corporation with a big corporate salary structure. In order to make any plastic kits at a profit they need BIG, BIG, BIG volume numbers.
If they can't be sure to sell 60,000 pieces of something, they don't even want to start the tooling process on a new kit!
If you are going to do model kits at BIG volume numbers you must produce NEW kits in segments of the market that sell BIG volume.
RC-2 has been trying to get by on selling lots of OLD kits, the same OLD kits over, and over, and over. Even car guys ony buy the same OLD kit for a limited number of times.

In my humble opinion a modestly sized company producing a variety of FRESH, NEW kits could operate profitably. The mix of kits would probably be heavy to automotive subjects but could include some Sci Fi hardware and possibly a few figure kits.
Such a company could not pay officers of the company quarter million dollar a year salaries and succede! 
But it could provide nice livings to a CEO and a reasonably sized group of employees.

My vision of a sucessful model kit operation would by necessity include people with model kit and hobby industry experience. 
Just hiring a bunch of people with marketing degrees won't get it done!
If you intend to produce car kits you better hire a car guy or two! If you want to do sci-fi it would be usefull if sombody knew the differences between NCC-1701 and NCC1701-D. I do not believe that RC-2 understands this!

The fact remains that there is still a market for GOOD model kits out there - Tamiya, Hasegawa, Eduard, Trumpeter, and a bunch of other medium to small companies continue to give witness to that fact! 
The difference between those companies and RC-2 is that they are not BIG CORPORATE operations with BIG OVERHEAD! And they seem to be run by people with some understanding of model kits and the hobby market place.

I'm still convinced that a buyer will be found for the Plastic kit assets which RC-2 now has. My only hope is that the buyer has connections to the hobby industry and is not another big corporate entity with no understanding of or attachment to the product line and the hobby marketplace.

Dave


----------



## DinoMike (Jan 1, 1970)

Good points, Dave... my only thought on that is: RC2 will probably set such a high price for the plastic kit assets that only a comparably-sized company could afford them.


----------



## Dave Metzner (Jan 1, 1970)

Mike,
I don't think that the assets are such that the asking price can be too outrageous.
They have apparently already disposed of the Aircraft kit tooling - it appears to have been sold to Italeri. Italeri is re-issuing those kits already.

The car kit tooling consists of a very large catalog of tools - almost all are old, I'm pretty sure that RC-2 has reissued everything that they could without investing in any significant tool repair or replacement. 
I'm also sure that some of those old tools are either worn out or missing parts etc. There is a very long list of car kit tools but I believe that quite a few would require significant work before they'll produce anything you could sell!

RC-2 will let the Trek and Star Wars licenses lapse and most of those tools are OLD! The only Trek tools they have that aren't ancient are the Polar Lights tools! 
And the Star Wars stuff is of indifferent quality as well as being OLD!

There are several PL figure kit tools that should never be re-issued - they were not good sellers for PL why would a new owner waste money to do anything with them.

I'm not sure that the tooling will bring really big dollars - I'm sure that the figure will still be several million - but in today's world that would not be beyond the reach of a medium sized company.

Who knows what will happen? I'm sure RC-2 won't be making any announcements until they have the deal all done. 
I'd bet that they won't just sit on the assets. They'd rather dispose of them, at whatever price, and re-invest the dollars in a piece of the corporate holdings that they feel will be more profitable.

Dave


----------



## toyroy (Jul 17, 2005)

Another option is to licence the brand, and its associated tooling. MPC did this with Lionel trains in 1970.


----------



## xsavoie (Jun 29, 1999)

Italeri buying the aircraft tools is great news,since the FLYING WINGS aircrafts and XB-70 as well are still very new and well detailed kits.I certainly hope that they will be reissued soon.Very exotic aircrafts.These were issued in the 90's.During that time AMT looked more promising than ever.Big corporations almost always shoot themselves in the foot when they choose to include model kits in their sales selection.Only someone with less ambition for incredible profits and with experience in this business will probably succeed in making it work.


----------



## Dave Metzner (Jan 1, 1970)

RC-2 is not looking for incredible profits, they just have very big overhead so they need big sales volumes to cover that overhead and still generate any profit at all.
And since they have mostly been selling re-issues of old kits instead of new kits
their sales volume has not been sufficient to cover overhead and produce profit at satisfactory levels.
My theory is that a more modestly sized company with more modest overhead producing a few nice NEW kits every year can generate very satisfactory profit from somewhat smaller sales volumes.

Dave


----------



## John P (Sep 1, 1999)

Well, I didn't win the MegaMillions lottery this week, but I'm buyin' another ticket Monday!


----------



## xsavoie (Jun 29, 1999)

I wonder if REVELL will buy a few molds from them as well.Did Italeri buy all the airplane molds,or just some of them.


----------



## lisfan (Feb 15, 1999)

maybe tom can step up and get round two going with some of his old molds and grab a few others to boot.


----------



## TAY666 (Jan 8, 2000)

I am sure that RC2 isn't looking to sell a few here and a few there.
If they break it down at all it will probably be in lots of type of kits.
In other words if you want some car molds, you need to buy them all.
If you want some figure molds, you need to buy them all.
Etc.

It's the way things are done.
Otherwise you have people cherry-picking and you end up with a bunch of stuff that no one will take off your hands.


----------



## Dave Metzner (Jan 1, 1970)

I would suppose that Italeri has all the aircraft kits tools..........I would guess that RC-2 either sold them or has leased them all to Italeri...

RC-2 knows NOTHING about Plastic aircraft models - the laid off everybody who knew anything about model airplanes several years ago, about the time they bought Ertl.

The important thing to remember about RC-2 - is that RC-2 Corporation has been built by buying companies not by building companies. They keep buying up companies that they think fit into their corporate portfolio. They will sell pieces that they can't make money from.

When thay bought Playing Mantis, they really wanted Johnny Lightning, They have already sold Slot cars and Action figures back to Tom Lowe.
They'll keep JL and sell the Polar Lights assets with the rest of their plastic kit assets.

I don't think that they'll sell the Plastic Kit division in pieces and parts. I'll bet that they want to dispose of the whole package. To be truthfull if I had capital to invest I'd want the whole package because I'm convinced that you'd need all the car kits to provide the kind of sales volume needed to make it work.

Dave


----------



## irishtrek (Sep 17, 2005)

Well a local store chain has AMT kits on clearance right now.


----------



## John P (Sep 1, 1999)

Dave Metzner said:


> RC-2 knows NOTHING about Plastic aircraft models - the laid off everybody who knew anything about model airplanes several years ago, about the time they bought Ertl.


 That was a blow to me too - Ertl had JUST started making some very nice airplane kits. Their A-20 series was pretty darn good. Thankfully I got them when I could. So I'm tripley pissed at RC2 for killing Ertl's planes, and SW and ST lines. They're like the modeling antichrist!


----------



## Dave Metzner (Jan 1, 1970)

No John, Theyre not the modeling antichrist - they're just a corporation that got big by buying a grocery cart full of small to medium sized companies. 
They've been sucessfull at running some of those companies and not so sucessfull at running others.
It just happens that they've been unable to get a handle on the plastic kit business. Ertl's was in trouble before RC-2 bought them - they'd already screwed the plastic kit operation up. RC-2 came in and canned everybody who knew anything about plastic kits and tried to run it with Ertl's die cast people. 

The AMT and MPC brands have been owned by several different corporations or companies over the years, looks like they'll have another new owner before too long.
Let's hope the new owner has a better grasp of the plastic kit business than the last two did.

BTW Italeri will be re-issuing one of the Tigercat kits shortly.......Odds are pretty good that they'll re-issue the A-20's too.

Dave


----------



## John P (Sep 1, 1999)

I'm still gonna go with the antichrist theory. It makes me happy to focus my rage on them, whether I'm right or wrong.


----------



## Prince of Styrene II (Feb 28, 2000)

Atta' boy, John!! Go get 'em!


----------



## Dave Metzner (Jan 1, 1970)

Ok John,
Whatever trips your trigger!
Dave


----------



## veedubb67 (Jul 11, 2003)

Dave,
Thanks for the insight. Many of us (including myself) tend forget that models are a business after all and that profits are the bottom line. RC2's business model is no different than the defense industry - the big fish (Boeing, NG, etc) buy up the little fish, reduce the competition and control the market. That's why you have $300 screwdrivers and $800 coffee pots.

Rob


----------

