A little question: 1986 vs. 2003

[tcsenter]

Howdy folks,

In 1986, the MSRP of a Honda CR125R was $1998.00, I know because I bought one off the showroom floor (I paid slightly less than MSRP of course). I remember the MSRP of motorcross bikes during the 1980's increasing only by $100 or so from one year to the next. Then somewhere between the 1988 and 1990 model years, the price of dirt bikes shot up to over $3,000 for a 125cc (1989 CR125R MSRP was $3200.00).

My question is, what the hell happened to cause this huge increase? Was there some kind of import tariff or EPA tax imposed on dirt bikes, something, to cause this huge increase over that two year period? Today, a new CR125R is $5,000 (MSRP) - Good God Almighty!

And does anyone else besides me who bought a bike or three during the 80's feel that $5,000 for a new 125cc is just outrageous on the grounds that motorcross bikes today aren't all that damned 'better' than a $1998.00 1986 model? Oh sure, you arguably get 15% better handling and performance, so you get a bike that is at most 15% "better"....except it costs 150% more!

I don't see how they're any more reliable, I rode the HELL out of my 1986 CR125R but did not perform anything close to the rigorous maintenance schedule recommended in the manual. I sold it in 1990 with approximately 70 hard-riding hours, it still ran like new. So I just can't see the 2003 models being 150% more reliable than that.

Of course I understand inflation. But even adjusting for inflation, a 125cc shouldn't cost $5,000. Wow!

 

[Tony Eeds]

Mmmmm 1971 .....
Penton 125 ISDE Six Days .... $600.00

If we didn't remember the past, there wouldn't be any inflation. Based upon the CPI, costs are rising faster than inflation in almost every respect. My dad bought a car and paid it off in three months. He could have paid cash but wanted to strengthen his credit. Now, I put more down than he paid for a car and still have to get 48 months to pay it off. I refuse to buy the 60 month deals. I still target 24 months for any automobile.

Bikes, cash or I don't get them. Depreciate too quickly.

My kids (29 years old this month) will likely never see a day that they don't owe everybody based upon the progression of things. They have never experienced (in my estimation) delayed gratification.

There is going to be hell to pay in the not to distant future for the way we are mortgaging our future for our present.

 

[viking20]

Guys,here in Denmark,Europe,I would have to pay more than 6000$ for a 125!A CRF 450 would cost approx.8000$! :(

 

[TM-Frank]

Really? Price increase? No such problems here in Germany! I remember that they wanted 7500,- for a Husky 510 in '84 and for that price you will still get a new thumper now.
Well, wait, it was 7500 Deutschmarks then and is 7500 Euros now. Hmmmm... :think:

 

[BadgerMan]

Compare 1996 prices to 2003 prices and you will see that they have stayed the same...............thank God for that! The large increases happened in the late 80's and early 90's and it was blamed on the dollar/yen relationship. I think that the competition from the European manufacturers has helped keep the prices stable in the last few years. Plus the fact that Japan's economy is hurting.

Cars? I 1978 my dad bought two brand new cars. A bonneville and a regal. He paid ten grand total for the two of them!

The auto manufacturers have been playing a game of designing in content (adding options that normal people would not normally pay for) and then offering the lease option to those who cannot afford to purchase the thrity thousand dollar vehicle (the average person!). Pretty sad IMHO.

Look at the new car ads in the newpaper. They don't even advertise the purchase price anymore.

 

[jmics19067]

I guess what bugs me most is that even though I make more money now than I did it just doesn't seem to go as far. The price of progress?

 

[Tony Eeds]

Originally posted by jmics19067
I guess what bugs me most is that even though I make more money now than I did it just doesn't seem to go as far. The price of progress?

IMHO - It doesn't go as far. But remember that we pay for all sorts of things our parents either received for free (radio & TV) or didn't even exist (www).
I don't have cable, I don't have a working TV ..... and now they are trying to "sell" us radio.
Have you noticed the amount of advertising on PBS? Notice, they still beg. Go figure .....
When I graduated from high school (1969), I thought that if I ever made $600.00 per month I would be in high cotton. Passed that a long time ago and I still feel like I am in the weeds. At least I can tear the hell out of them with my knobbies!

 

[MikeT]

I remember the situation VIVIDLY! The claim for the radical price increase was a re-evaluation of the Japanese currency (yen? or is that Chinese??). Anyway, they basically said that the value of the dollar was worth less and or Japanese currency was worth more than the dollar however the price of bikes had never been adjusted accordingly. They just kept doing the $50-$100 per year as always. Well things came to a head in 1988 when the 1989 models hit the showroom floors. HONDA was the first to have the $4000 250cc and I think the 125 was like $3800 or something close to that. Within a month the others followed suit, Kawasaki, Yamaha and finally Suzuki (I believe that was the order). Anyway, when Honda first made the increase, everyone said they wouldn't pay that for a bike........ Well, now we are buying $5000+ bikes.

History class is over and I still can't afford a new bike. I hope that answers your question.

MikeT

 

[Hucker]

Ha ha, you guys need to look north of the border and see how much we pay.

Brand new '03 CRF450R $8199.

Ad tax to that.. 15% for a grand total of almost $9500. And remember, this is for a bike you ride on weekends, in the dirt :uh:

 

[yzeater]

Originally posted by Tony Eeds
I don't have cable, I don't have a working TV

Whaaa???

 

[Tony Eeds]

^^^^^^ :) ^^^^^^^
Yes sir that is correct. I have a TV but no rabbit ears and I can't find the cord for it (don't look that often either). Don't miss it but I do watch Fox News when I am on the road, oh and DVDs on my computer every now and again. Just watched Bruce Brown's On Any Sunday and Endless Summer as a matter of fact. Both are over 30 years old .... culture is like wine, it gets better with age. Why else would all the youngsters be dressing like we did in the 60s and 70s.

 

[Chili]

In regards to bike pricing I have a little story that always amuses me when I think about it. In 1978 I took all my paper route money and bought a brand new 1978 RM 80 for $625 I beat that bike bad for 2 years and sold it for $400 and figured I made out like a bandit. In 2000 when I started looking for a bike for my son I came across two 78 RM 80's, both sold for $800. Now if you had told me in 1980 to put the bike in the garage and it will be worth more than you paid for it in 20 years I think you would have gotten an odd look. For any historians looking to verify pricing all $ amounts quoted are CDN :)

 

[Pantera]

Lets see,water cooling,disc brakes,variable exhaust ports,aluminum frames,totally adjustable suspension,trick ignitions,totally reliable motors, a total package that you could take to the starting line of a national.Semi race haulers,RC salary,We wanted trick bikes, the Japs gave it to us.6000.oo sounds like a bargain to me.You cant buy a chevy mini pick up for under 20 grand either

 

[BadgerMan]

I still remember a cycle mag ad from late 1975 when Honda was trying to move the unsold '75 CR125's (the silver ones with red trim). The sale price that sticks in my mind is $450.00.................brand new! You could probably get 4 or 5 times that for a nice used '75 Elsinore now.

 

[tcsenter]

I remember the situation VIVIDLY! The claim for the radical price increase was a re-evaluation of the Japanese currency (yen? or is that Chinese??). Anyway, they basically said that the value of the dollar was worth less and or Japanese currency was worth more than the dollar however the price of bikes had never been adjusted accordingly.

Ok, thanks for the information. There had to be some reason.

Lets see,water cooling,disc brakes,variable exhaust ports,aluminum frames,totally adjustable suspension,trick ignitions,totally reliable motors, a total package that you could take to the starting line of a national.Semi race haulers,RC salary,We wanted trick bikes, the Japs gave it to us.6000.oo sounds like a bargain to me.

Probably because you never purchased a new bike in the 80's? So we essentially got a lot of "trick" parts that in reality only add a small increase of "trickery" to the "trick" parts that were already available on bikes in 1986 or 1987: water cooling, disc brakes, variable exhaust ports, aluminum frames, totally adjustable suspension, CDI ignitions, reliable motors, etc. etc. As I said, a 15% better bike for 150% more cost. lol!

I still remember a cycle mag ad from late 1975 when Honda was trying to move the unsold '75 CR125's (the silver ones with red trim). The sale price that sticks in my mind is $450.00.................brand new! You could probably get 4 or 5 times that for a nice used '75 Elsinore now.

What got me thinking about this was that I recently saw a USED 1987 CR80R selling for the same price as the MSRP was brand new on that bike. I thought, Holy Hell, I should have held-on to all of my motorcycles! ;)

 

[Pantera]

and candy was a nickle

 

[jmics19067]

and now penny candy is a quarter :think:

 

[tcsenter]

My dad remembers when you could go see a movie for fifty cents. Granted, that was 57 years ago, not 15.

I can still catch a matinée at a nice clean local theatre for $3.50 per person, but anything at the concessions counter will cost you a week's pay. ;)

 

[Motopainter]

5 gallons of gas 1 can of blendzal or torco $3.00 .Today 5 gallons of gas 1 can of maxima $14.00 Lets go riden!!

 

[MikeT]

Originally posted by Pantera
Lets see,water cooling,disc brakes,variable exhaust ports,aluminum frames,totally adjustable suspension,trick ignitions,totally reliable motors, a total package that you could take to the starting line of a national.Semi race haulers,RC salary,We wanted trick bikes, the Japs gave it to us.6000.oo sounds like a bargain to me.You cant buy a chevy mini pick up for under 20 grand either

The radical change in price occurred in one single year. The 1988 bikes were MUCH cheaper than the 1989 models and not a whole lot happened between 88 and 89 in the field of MX technology. Honda flipped the forks but that was about it.

 

[IrishEKU]

Originally posted by MikeT
The radical change in price occurred in one single year. The 1988 bikes were MUCH cheaper than the 1989 models and not a whole lot happened between 88 and 89 in the field of MX technology. Honda flipped the forks but that was about it.

:think: It really had nothing to do with the bike makers. Chalk it up to the recession, Reaganomics, and the close of the "Big Spending" days of the '80's. If I remember correctly the S&L and Junk Bonds Scandals had alot to do with prices going through the roof about that time. I was in HS at the time and the cost of everything rose exponentially with the fluxuations of the market. I'm just glad history didn't repeat it's self in the wake of 9-11. Granted some bussiness's took a hit but prices basicly stayed the same or stabilized after a couple of months.

My take on it anyway,

 

[Tony Eeds]

Originally posted by IrishEKU
.... I was in HS at the time and the cost of everything rose exponentially with the fluxuations of the market.

Bikes are nothing, you should have been in the housing market in the 70's. Prices jumped like crazy and you were lucky to find a mortgage at any thing less that 12% in a lot of cases.

But then notbody cared, because interest (all of it) was deductable. This was repealed (if I remember correctly) in the tax code changes of the first Reagan push. IMHO, it was one of the best tax changes inacted because people didn't care what interest cost. The stability of teh 90's and the low interests of today, I peg to that change.

OK .... jump on me you bean counters and financial types. :)

 

[jeffd]

Don't forget about the AMA changing the "production" rules too. As I recall, that was somewhere near the same time frame. The bikes that were raced and the ones sold to the public were bareley even related. The AMA imposed production rules and BAM! Costs go up for the consumer because factory R&D had to start making "race-ready" bikes for the consumer in order to be competive in following the new AMA rulebook. Ah.... The days of the works bikes when everything was hand-made!

-jeffd

 

[mhardee]

Originally posted by tcsenter
In 1986, the MSRP of a Honda CR125R was $1998.00,
Of course I understand inflation. But even adjusting for inflation, a 125cc shouldn't cost $5,000. Wow!

In 1981, my 490 Maico was $2,750 new (when the Hondas were ~$1,200)..

Just bought a 2003 KX-500 last month.....

Exactly: $5,021.98 (including sales tax)... GEEZ-UHS!!!

But, I AM riding again!...

Mark

 

[Highbeam]

Lets bring out the economics book. If you will pay twice as much for my bikes I only have to sell half as many. If Honda lost a portion of their customers but still increased total profit they are happy. I know it seems odd but dirtbikes are a luxury. People value their leisure. If the value of the bike is higher than the purchase price it will be purchased. Don't expect the bike makers to do us a favor by keeping bikes cheap for some kind of community service. Their job is to maximize profits, to do this they need to increase revenue or decrease costs. They apparently chose to increase both. Admit it, if someone would pay you a million dollars for that used RM80, why would you sell it for 100$? If the bikes are really overpriced then a new maker could undercut everyone and gain market share. Such is the beauty of the free market.

The same thing is happening with a 50,000$ pickup truck. Or our lifes, we need to decrease costs or increase revenue to improve our personal net worth. One way I decrease costs is to buy used bikes and trucks. Every little bit counts.

Oh and Tony. I got the longest term truck loan I could. I make huge additional payments on this loan as long as that is possible in order to pay the loan off in less time than full term. My 7 year loan will be repaid in 2.5 (This March!!). This does not cost anymore than if I got a 2.5 year loan (assuming rate is the same)since interest is charged per time. The reason I did this was to protect myself if I lose my job or we need to make a huge purchase, the minimum payment is nice and low.

I never intend to pay my house off.