Die-cast models sell “well into the millions” each year, said Pete Henseler, president of Glen Ellyn-based Racing Champions Ertl. “I wouldn’t even venture a guess how many.”
Racing Champions Ertl may not divulge production figures, but a random NPD Group toy industry report from October 2000 showed Ertl competitor Hot Wheels selling 6.3 million die-cast cars, and Matchbox moving another 1 million units in the same period.
Those totals are for two companies for 31 days.
Combine that with the output of Ertl, Maisto, Johnny Lightning and Revell-Monogram, factor in specialty houses Franklin Mint and Danbury Mint, add another 35 die-cast lines and you’re talking serious volume.
Or as Henseler puts it: “Detroit produces how many cars a year? Around 16 million? We sell more than Detroit.”
Indeed, and like Detroit, the die-cast manufacturers are a secretive bunch not given to sharing much in the way of drawing-board specifics.
“Most of this information is proprietary,” said Charles Hepperle, product coordinator for privately held Maisto Inc. “The die-cast industry is highly competitive. You don’t want to give away your position on future product with a misplaced comment.”
Hepperle explains the process at Maisto. “We have a research department. I’ll give you an example of creative research. We review speeches given by top management of the major car companies and look for slips or throwaway comments about concepts they’re considering. If two executives from the same company make similar comments in different speeches, we think it’s worth following up, and we hand the information over to our licensing people. And the other die-cast companies are doing exactly the same thing.” Competition is strong to come out with the latest diecast first.
The Chrysler PT Cruiser and Volkswagen Beetle are recent die-cast industry slam-dunk successes, but how do the producers know the 2003 BMW Mini will sell? How do they decide? Does the fact that demand for a car is expected to be off the charts figure into the decision?
“Car companies come to us,” said Henseler. “That’s the die-cast industry norm. They’ll come to a Racing Champions Ertl to produce die-casts of concept cars they’re introducing. We’re involved that early on in the process. They share consumer research and have us sign confidentiality agreements not to reveal details. Right now, for example, we have four 1:64-scale concept car die-casts produced and stored, ready to support concept cars Chrysler will introduce at the Chicago Auto Show. Another example is the 1:18-scale 50th Anniversary Corvette we’re working on with GM.”
Henseler made his comments in a private showroom deep in the bowels of Ertl’s corporate offices, where the walls are layered with samples of product lines–Outdoor Sportsman, American Muscle, John Deere, Racing Champions. (Ertl has licensing agreements with more than 500 companies, from Cartoon Network to Kellogg’s.)
Exotic concept cars and Corvettes would seem a sure bet.
But Henseler says he can’t recall Racing Champions Ertl having a sales stiff. He argues far too much research is conducted before resources are committed.
Henseler won’t say how much it costs to produce the tooling for a die-cast, but Richard Walker of Corgi USA confirmed a figure of $80,000 to $100,000.
“We don’t only rely on data provided by GM, Ford or DaimlerChrysler,” Henseler said. “Our researchers review die-cast publications like Die-cast Digest and Tuff Stuff to learn what collectors want. We attend the major die-cast shows. We talk to collectors and use the Internet to survey customers to find out what they’d like us to produce. I think if you talk to people from other companies you’ll find they follow pretty much the same routine.”
Elaine Maloney-Crouse doesn’t disagree. She’s director of marketing and product development for the Johnny Lightning brand, for 10 years a division of Mishawaka, Ind.-based Playing Mantis Corp.
Introduced in 1969 by Topper Toys, Johnny Lightning die-cast racers were intended to compete with Hot Wheels. But Topper learned you don’t go up against Mattel, and threw in the towel by 1971.
The Johnny Lightning brand name sat in limbo for 20 years, until Tom Lowe, owner of Playing Mantis, acquired it to bring out a line of die-cast collectibles.
Maloney-Crouse is quick to differentiate between Johnny Lightning and Hot Wheels Cars.
“Collectors buy Johnny Lightning, and collectors are primarily adult men,” she said. “Our research shows 90 percent of Johnny Lightning buyers are over the age of 18, up to age 80 or so. Hot Wheels, by contrast, is a toy intended for children. There is an active market for Hot Wheels collectibles, but their cars are marketed as toys.”
She makes a point regarding toys versus collectibles. Hot Wheels sell for 92 cents at Toys R Us. Johnny Lightning die-casts, displayed about 10 feet away, go for $3.99 and up.
Ready to roll
So what does Johnny Lightning have coming up?
“I can tell you about the Aston Martin Vanquish. That’s the new James Bond car. We’re working with Ford and the James Bond people on a 1:64-scale die-cast and should have it out in October before the new James Bond movie is released in November. At least that’s the schedule we’re on now.”
Maisto Inc., with 1:18-scale die-casts going for $18 to $20, has the 2003 Lexus SC430 almost ready as well as the new Lamborghini Murcielago.
Product coordinator Charles Hepperle acknowledged the importance of collector demand in determining what new cars are produced but also emphasized the role retailers play.
“You have to take into account what the retailers themselves want to sell,” said Hepperle. “I mean the people who do the buying for large chains like Toys R Us and Wal-Mart. Consumers can request a certain car, but if the retailer doesn’t want it . . . it won’t go.”
Hepperle added that Maisto is “squeezing one car in for the serious collector” this year with a 1:18-scale die-cast of the 1969 Ford Torino Talladega.
“There’s an interesting story behind the Torino Talladega,” he said. “Ford produced only 700 of them. The extended nose and other modifications made it perform better for NASCAR, but to qualify for competition it needed to be a production car. So Ford built 700 of the Torino Talladegas by hand, and they’re extremely rare.
“We’ve had requests to produce a Talladega die-cast for years, and this year we’re squeezing it in.”
Morton Grove-based Revell-Monogram specializes in 1:64, 1:24/25 and 1:18-scale die-casts.
“Research works best with older cars people are familiar with,” said Ed Sexton, senior manager of product development and communications. “Customers request favorites. They’ll petition for a specific Mustang, for example.
“Deciding which new cars to produce comes down to previous experience. We know Corvettes always sell. We know Mustangs always do well. Two-seat sports cars like the Thunderbird are always popular with die-cast collectors.
“You look back to see what did well in the past, but you’re also aware of emerging trends, and to an extent you rely on gut feelings. For example, after 10 years or so of mundane minivans, one comes along called the PT Cruiser. It has a unique retro look and everyone says, `When that hits the street it’s going to be big.’ You just know.”
Revell-Monogram was sold to Cedar Rapids, Iowa-based Alpha International Corp. in September. Sexton now sees greater emphasis on new models, but not at the expense of vintage examples.
“Our plastic model division introduces the new cars,” he said. “But we have not been into the arena of producing new and concept car die-casts to this point. But we expect that to change. I see us moving in that direction.”
Looking back, forward
Sexton was the only die-cast spokesman who would admit to a mistake. And what was Revell-Monogram’s grand flop?
“In the early 1980s we introduced a Mercedes die-cast. I can’t remember the exact model now, but we thought it would be successful and we were half-right. It sold well for Revell-Germany, but not here.”
And what are the hot new models at Revell-Monogram?
“We have a series of cars from the movie `Bullitt,'” he said.
No, no, we’re talking about fresh 2003 technology.
“The Hot Truckin’ series of Dodge Ram, Chevy Silverado and Ford F-150’s? The Acura Integra Type R?”
And?
“I’m sorry,” he said recently. “I can’t really go into that until after the New York Toy Show.”
