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"How does one explain that RMT can sell a freight car for 28 bucks and the manufacturer, importer, and retailer can still make a profit? All of the above applies in regards to material, labor, and transportation cost."

I'm no expert on the economics of train production but I can hazard a guess.  RMT has no overhead to speak of except the owner's salary.  Probably works out of a spare bedroom.  Doesn't rely on RMT to pay his health insurance and any other benefits.  No life insurance, disability insurance costs.  No liability insurance I'd guess.  Doesn't amortize the building, allocate the costs of depreciation, heating, lighting and the staff coffee pot to the business.  No development costs because he isn't developing anything, including new tooling, electronics and other technology. No catalog costs .  In essence, it's like asking why it's less expensive to run a one room schoolhouse, or even a local high school,  versus the University of Pennsylvania .

Last edited by Landsteiner

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