|
It depends I think,
If the FoMoCo stopped supplying the bits as they have no interest in Kent engines, there would be few suppliers who would be interested in machining these bits as there is a relatively small market for them.
If there were one or two independent manufacturers, they would be producing to smaller volumes, which would mean there costs per unit would be higher as a result. This would prevent the costs from being as cheap as we like. Also with just one or two suppliers available, they would have a monopoly style market position, and as demand for these bits is price inelastic (the demand is constant despite the price) why would the new suppliers drop the price by as much as we would hope they would?? They would be making less money.
If loads of suppliers made the bits, the prices could fall, but then we would have the problem of who made the best bits??? Invariably, the more you pay, the better the quality is, so we are back where we started.
Its just something we have to live with unfortunately.
|