I think this is a load of baloney, but I want to be sure my instincts and research are correct

I was at a piano store today. Salesman was pushing very hard for me to at least put a "hold" on a piano, even after I told him I was not buying today and still doing my "due diligence".

He asked, "what else are you looking at?"

Me: The upright Schimmel!

Him: Oh no! Don't do that to yourself! Schimmel is a great brand, but just so you know... all pianos imported from Europe have to pay a HUGE import tax, that makes them MUCH more expensive. Then, when you resell, you can't get any of that back... so they drop like 50% right away.

He then shows me something on his computer that shows a Bosendorfer with a price of like $30-$40k (no clue what this was of course). And tells me, the original new price was >$100k, but "we can't sell it for that, because it's lost so much of it's value!"

*Everything* I've read speaks pretty highly of the European pianos, including Schimmel. Also, I've been reading about piano depreciation and how to figure out the value of a used piano... nowhere did it say "oh, use this extra horrible depreciation scale for European pianos."

In fact... I think it said, "fine pianos may keep thier value longer than others..."

I'm not crazy right? I hate having to deal with this stuff. And, I'm bad at in real time, I generally just smile and nod politely, wondering when I'll be able to escape!

The import duty on both upright pianos and grand pianos is a whopping 4.7%. The dealer is full of excrement.

Like many large ticket items, pianos lose some market value upon sale. This is not something that afflicts European pianos more than others.

Thank you Piano-Dad!

I hate this kind of stuff. I don't know why some dealers don't realize that outright lying to your potential customers drives them away.

Thanks for the sanity check!!!

You have been the victim of an episode of FUD salesmanship. FUD= fear, uncertainty and doubt. It is, unfortunately, endemic, and not just in piano showrooms.

Saerra,

The dealer was obviously treating you as though you are stupid. And you most likely won't go back there. Who's stupid now?
The more educated we make ourselves the less that sort of excrement (as pianodad so eloquently put it:)will fly.

Continued luck in your hunt.

Although I am a trade economist by training, I didn't know the exact tariff on pianos offhand. But any idiot with google can find it.

US Tariff code on Musical Instruments

A dealer who casually lies to people is banking on some percentage of the 'marks' not doing their homework. It's despicable, of course, but I guess many people have internalized a disregard for basic ethics so thoroughly that their sleep is completely unaffected by their behavior.

Unfortunately, there is very little to do unless you wish to name names, which you should not do because you have no proof except for your own personal experience.

What did they sell, BTW, that was worth using outright deception to steer you away from European pianos?

Strong words from Dad! BTW, what's that pungent smell?

saerra,

There is the percentage of depreciation and then there is the dollar depreciation. Obviously, if you buy a Perzina vertical for 6k and five years later suffer 50% depreciation upon resale, you will have lost 3k in nominal dollars. If you buy a modest Schimmel C120 in PE finish, pay the MSRP of over $20k, and five years later suffer 40% depreciation on resale, you will have lost 8k in nominal dollars. Of course you won't pay the full MSRP, but you might pay more of it than you have to because the spread between MSRP on the European pianos and the street prices to shoppers who inform themselves and negotiate is very big. Anyone who prizes a new European vertical in the US and who values money should shop very very carefully. The best way to minimize depreciation on such a piano is to bargain hard. This piano category (new European verticals) is the most sluggish segment of a generally sluggish market.

Let's play devil's advocate and say that the dealer is right. Would it not follow that a recent manufacture low-mileage European vertical would be a whale of a deal because it's lost so much of its value? So you could check out asking prices on recent Schimmel verticals to get a sense of the actual market. If the dealer is right and you find one that you like, it could be a good opportunity for you.

My own advice to you is that if you worry about retention of value because you anticipate selling in the future, you should buy the cheapest piano that you find satisfactory since the actual dollar loss will invariably be lower. If you don't want a cheap piano, then buy a U1 or a U3. They hold their value better than any other vertical pianos. If neither of those alternatives is attractive, scour the used market for European verticals and be patient.

IMO, if I was a dealer, I would require my salespeople to be completely open and honest, or the piano of the customer's choice (even if it happens to be one of the most expensive concert grands that the store has) is free to the customer (including delivery, first 6 months of service, and (if applicable) hauling away their old piano), paid for by the dishonest salesperson. Making the salesperson gift the customer the piano would, at least for the first several offenses, be in lieu of termination. (Chances are, especially if the salesperson had to buy a customer a $200k Bosendorfer Imperial, s/he wouldn't do that more than once, and hopefully if s/he knew the consequences ahead of time (btw if the salesperson didn't know, I'd cut some slack), wouldn't be dishonest at all.)

My advice is to buy the piano you prefer. This is a long term investment and most people never sell their piano. So buy the piano you like and can afford. If that's the Schimmel, great. It's a lovely piano.

Only other issue is of course that buying a European piano in the US means you have two different added variables to contend with compared to us Europeans buying one:

Cost of transport to the US is greater than to Europe if they are originally made in Europe
Dollar to Euro rate may make them less attractive to US buyers compared to either pound to Euro, or European buyers who can pay in Euros etc.

I researched the prices of Irmlers in US for example and the list prices in the US are higher than those in the UK. Now that may be because US dealers expect to do far more negotiating than those in the UK of course, but I am sure there is an element of the above as well, historically European products are cheaper in Europe than in the US, and Chinese and US products are cheaper for you in the US than they are here for us in Europe (electricals for example).

No doubt there will be someone more knowledgeable than me that can shed more light on this.

I believe the only pianos in North America that can avoid import taxes are NY Steinways and Charles Walters. There may be actually one or two other small operations such as Fandrich and Sons that qualify as American made as well, and I highly doubt the smaller operators would say something against European instruments. Or am I missing something?

European cars tend to be considerably less expensive in the US than they are in Europe - even with current exchange rates.

Transport costs across the Atlantic are surprisingly inexpensive, and while I can't speak from personal experience regarding the historical cost of European pianos in the US, it would seem that any differential would be primarily the fault of fluctuating exchange rates.

The Economist most recently estimated in July 2009, using their highly scientific Big Max Index, that the Euro is "overvalued" against the dollar by about 30%. The Euro's exchange rate value has continued to rise since then, putting even further pressure on Euro area manufacturers.

Not all of the exchange rate difference is passed along, however. Because European piano manufacturers must compete in the American market with Japanese and Chinese manufacturers (both of who's currencies are "undervalued" against the USD by PPP) - not to mention American manufacturers themselves. European piano makers are likely forced to dig into their own profit margin to stay competitive in the US. At least, that it what happens with European vehicles.

On the other hand, the Eur-USD PPP gap has been with us for several years now, indeed almost a decade, so perhaps the Euro area manufacturers have been forced to bring their US prices into line with true exchange rates.

Of course, we can definitively answer this by simply comparing street prices of European pianos in the US vs. Euro area. My guess is that they'll cost about 15% more in the US after accounting for the ~5% import duty.

Here is The Economist's most recent "Big Mac Index," which they use to create a "fly by the seat of your pants" relative PPP index.

http://www.economist.com/businessfinance/displaystory.cfm?story_id=14036918

My understanding is that a very significant percentage of the cost of purchasing a new vehicle in Europe is taxes.

For example: On cars from 0 to 1400cc, VRT is charged at 22.5% of the OMSP. So let's imagine a carmaker imports a car and wants €9,000 for it. The revenue commissioner will add 21% VAT to that, bringing it to €10,890. In order to register it so you can tax it and make it legal to drive, the buyer has to pay another 22.5% on top of the €10,890, bringing the price to a grand total of €13,340. So that’s almost €4,500 paid in tax on a small car excluding any delivery or additional charges.

Source: http://www.motornet.ie/content/templates/template_tax.asp?articleid=2963&zoneid=68

Further, the US dollar is not likely to rise against other currencies (in my opinion) while its citizens continue to have relatively low personal tax rates while the money supply grows at rather astonishing rates.

"Here is The Economist's most recent "Big Mac Index," which they use to create a "fly by the seat of your pants" relative PPP index.

http://www.economist.com/businessfinance/displaystory.cfm?story_id=14036918 "

Thanks, Toman. This brings currency valuations to the range of something I can grasp. Talk about "eating the difference..."

birchy,

You're absolutely correct about the European taxes on vehicles. Add in the fact that Europeans typically announce taxes on the sticker price, whilst Americans view sales taxes only after the sale, and you can account for even more of the discrepancy.

However, personal income taxes in the US are not low in coastal populous locales such as CA, NY, MA, and the like; they are at or over 50% for many.

Having imported pianos from Europe for more than 30 years, we assess (add) 6% to the wholesale cost to establish our wholesale. This percentage is an amount sufficient to include duty AND freight to the nearest airport. Generally, Tier 1 pianos are flown in - this may sound expensive but on average its about $1,000 in air freight for a 6' grand. This is a minor cost compared to the actual cost of most of the instruments, and it is much easier on the piano than a nice cruise (since they don't use the midnight buffet). In some cases, the cost and the hardship on the piano is LESS than trucking a piano from New York to Seattle in the dead of winter.

I guess we can thoroughly label this one "Busted". I knew it didn't make sense!

You guys are great, thanks! And, as I said in the other thread, I ended up buying the Schimmel today!

Oh, and in a great turn of irony, he sent me a follow up email today. He mentions to me, "Although you were given a great price on that Schimmel upright (whatever the reason for the tremendous discount)..."

Really? "Great price" and "tremendous discount"? Because last night he seemed to imply I was being ripped off, the price was way too high, and it would lose all value as soon as I got it home.

Funny!

Though honestly, I'm glad the "shopping" part is done, and I can get back to the fun part, PLAYING!

saerra

saerra,

Congratulations! Tell Don Bennett I said Hi!

Just by coincidence, we were looking at Schimmel's at a local dealer yesterday. They are a Yamaha dealer and have 2 used Schimmel grands, so on a lark we went to see them.

My husband looked at the smaller of the 2 and said, "what's that control box?" As I was just walking up and hadn't seen it yet, I replied, "Probably either a Damp Chaser or a player system." Salesman overheard this and said, "you will never see a Damp Chaser on one of our pianos, we'd rip it off before we put it on the floor." Then went off on a diatribe about how awful DCs were. (rolls eyes)

Well, while they may rip DCs off, they don't fix pedals (soft pedal causes all notes on the left hand side of the keyboard to play minor seconds; middle pedal doesn't work at all), or tune or EVEN DUST THE KEYBOARDS of trade-ins they only keep around to show how 'awful' other brands are.

When they saw me looking at the Schimmels the immediate response was, "can you live with the soundboard cracks?? Because European pianos are not made for the U.S. climate. Their soundboards will all crack." Pointed out the huge visible soundboard crack of the smaller Schimmel, which was only about 13 years old, as "proof".

I don't think he liked me anyway. I suspect he much prefers customers who have NOT done any homework. At the beginning of his DC diatribe he asked smugly, "Do you know what's wrong with Damp Chasers??" (expecting me to be impressed by his knowledge).

"They keep the soundboard at a different humidity than the rest of the piano?" I deadpanned back. He didn't know how to respond. Shortly thereafter he dumped me to go talk to a couple of non-pianists who wanted to buy a digital "grand" for their church. He told them digitals were much preferred because you could turn the power off to the sanctuary and not worry about the piano.

And presumably a lot quieter if the power is off...

I think I would have said "Good day" after the first diatribe. Dealers like that are not worth the gasoline it takes to drive to their stores.

This salesman was clearly a schmuck, but there is a point to be made here. Don't buy a European upright for the resale value. They could easily lose as much as 50% of their value because there is so little market for them in the U.S. If you find one that you love and plan to keep, then it doesn't matter. If you think you may one day want a grand, then buy cheaper and save up. We're trying to make sense of this right now ourselves.

I would gladly take his worthless Bosie off him for $50K.

I knew the salesman that ProdigalPianist talked about. He told me Estonia piano is the worst of the worst, and in the NAMM show, nobody give a &*$# about them. Bosie has no horse power, and is built the same way it was built hundred years ago with no improvements. And Schimmel will not get out of the re-org ...... Fun stuffs!

One can only hope that in this frightful economy, the offending salesperson won't last long.

European pianos are wonderful and offer a decidedly different tonal response to the Asian and American catagories. Within their own catagory they can range from bombastic to sweet and lyrical.

Funny, that's exactly what people say about GM cars.

saerra,
I'm glad you didn't buy a piano from that jerk. Congrats on the new piano.Good choice. I must have missed your thread announcing it's purchase. Anyhow,good luck and please post pictures.


Terry

She put up some nice photos, Terry. Some are on this forum and some are on ABF.

Thanks Jeff,I will search for them.



Terry

Hi Terry,

They're actually right here (you'll have to follow the embedded links - sorry about that!): Saerra's Piano Pics

And, you can see the curtains I put up around the piano to try to soften the sound, and decorate the bare walls, here:
Piano Curtains!

Thanks for asking.

re: The dealer. He had sent me a followup email. I thought about ignoring it, but I'm a polite person, and figured I'd send a brief reply and let him know that I'd bought a piano and was done (so no need to follow up anymore )

A couple days after that... I got a weird message from him, saying that he wasn't sure if he should tell me, but b/c of everything going on with Schimmel, if I had waited 45 more days, I probably could have gotten a MUCH cheaper price on the piano.

What the heck? I mean, I can not think of a single good reason somebody would say this to me. The piano was already bought and paid for, so this is irrelevant, and can obviously only lead to bad feelings.

I really try to give people the benefit of the doubt... but I can't think of any positive motivation for this at all.

Very strange to me... but yeah, won't be back there again!

YIKES!!! That's rotten. Especially about the Estonia, the ones I played were simply *beautiful*!

What a jerk Saerra! Some people just have to go out of their way to do nasty things to people who don't buy from them!

Regarding the dealership we went to that I talked about above...someone else told me that it's possible to force a soundboard crack in a piano with a heatlamp, and that some dealerships did that to trade-in pianos of brands they didn't carry, that they wanted to keep to scare customers into buying their brands! That seems extreme, but having known questionable "horse traders" in many fields, nothing would surprise me anymore...

The real story of European pianos is told by their in almost each case 150-200 years history in the art of music making.

Norbert

ProdigalPianist - wow. It's hard to imagine somebody being willing to do that to a piano, but I see your point. Scary!

Norbert - You sound like my teacher (in a good way!)

Saerra,
That is one pretty black beauty. Great choice in pianos. Schimmels are great instruments! May your family,guests and home always be blessed with the sound of music.Thanks for directing me to the photos.


Terry

Ahh, Excellent point Norbert!

But sadly, according to some, that story may be in its final chapter. As the world of piano manufacture rapidly changes, perhaps in too few years, the illustrious history of which you speak may altgether end; to be replaced by new manufacturers who must create their own path. I ask you- What will likely be their *legacy* in 200 years? Will it be the "art of making music", or the art of making ........?

I'm sorry Norbert, but for me, the answer to those questions makes me cry.


fingers

Thanks Terry!

If European pianos are going downhill, then dealers should be willing to offer deep discounts to get rid of inventory, no?

What kind of discount (off Larry Fine's prices) can you get today for new European pianos? 20%? 30%?? How about the tier-one brands like Hamburg Steinway, Bosendorfer and Fazioli?