theruleslawyer said:
I'm always shocked at the price of wheels. There has to be a happy medium somewhere between the big name brand ones and the sketchy ebay ones. I'm curious what brands people have found that make descent wheels, but aren't big name expensive. NRG is the one the comes to mind, but I've heard not great things about them.
I was kind of thinking about that recently myself. Here's a quick and dirty cost breakdown (based on my experience as an ME):
It's not exactly clear to me what the wheel material is, whether it is steel or aluminum. Seems like there are both out there. I would have though aluminum was too flimsy, but they often refer to the finish as anodize, which is what you do to aluminum. So let's say it's roughly 1/8" thick aluminum. A 330mm wheel is 13" in diameter, so you're looking at it being made from a 13" x 13" sheet. A 12"x12"x1/8" thick sheet of 6061 from McMaster is $32. They're buying it in bulk from a mill, so they really probably get it for half that, maybe even less. Let's go with about half and say a steering wheel has $15 of aluminum in it.
the wheel I'm looking at is the Momo Mod.07. It comes with a leather cover. If the grip is a little over an inch in diameter, then the circumference is ~3.5". Let's round it up to 4". The length of the rectangle that covers the rim is ~40" (PI x diameter of the wheel). The but that covers the spokes adds a few more square inches. So total leather is 4*40+5 = ~165 sq inches. Converting to sq ft it's about 1 square foot of leather. Let's round that up a bit because there's probably various leather imperfections they have to cut around and the shape probably makes efficient use of the leather difficult. I'm going to say 1.5 square feet of leather per steering wheel. I did a google search which suggested that good steering wheels might use nappa leather. Another quick google search came up with ~$8/sqft for nappa leather. So ~$12 worth of leather.
We're up to ~$27 worth of materials. For the foam, it's a little hard to tell. I'm going to guess someone like momo uses a decent foam, but I think it's still just an extruded tube that they put in place for something like the MOD.07. Looks like foam like this might be ~$5 in cost. Now we're at $32 worth of materials.
Without looking at one in my hands, it's hard to tell if they laser cut the wheel shape and then form it or if they pass it through a series of dies that cut and form it. Either way, the process time for both of those is pretty short, but it's on some very expensive machines and tooling. Less sophisticated companies that I've worked for might use a multiplier on the material to assign a cost to it. So they'd multiply that $15 worth of steering wheel metal by 1.5 and say that a finished steering wheel has an approximate value of ~$23.
We're up to ~$40.
We'll do the same thing for processing the leather (inspecting, selecting, cutting to shape). Now the $12 worth of leather is about $18 worth of leather after it's been cut.
We're up to ~$46.
Anodizing is usually by weight or area. For the quantity they're doing it's at most a dollar per wheel. $47.
I tried looking up where they are manufactured. I'm not sure if their wheels are made in Italy or somewhere in SE Asia. Let's assume Italy, though. My Google search said a seamstress makes about $12 Euro/hr in Italy. I bet it takes longer than you'd expect for a seamstress to make a wheel. I'm going to round it to half an hour, so that adds 6 Euros, or about $7 at current exchange rates.
So let's say a finished steering wheel is about $55 all in. Now the factory is going to multiply that by ~1.5 to account for the factory overhead (shipping/receiving, the building, the janitor, etc). So the factory probably considers the wheel to be worth ~$83 when it leaves the factory.
Most places I've worked at shoot for roughly a 50% gross margin. So that means that Momo has to sell to the distributor at roughly $160. Keep in mind that doesn't mean they make $80 per wheel. All the administrative, marketing, sales, and engineering costs will come out of that $80. If they're good they probably make 20-something dollars per wheel of actual profit.
Shipping is currently pretty expensive, but they can also probably pack a few thousand wheels into a shipping container, so shipping should only add a few dollars to that cost. Let's say that the wheel is probably worth something like ~$170-ish when it lands in the US.
The US distributor wants to make their percentage profit on it. They probably don't go for 50%, but something more like 20-25% So now let's say that they sell it to your local retailer for ~$210.
Add in another round of shipping costs to it and that means your local distributor is making something like $30 off of a wheel they sell at $250. Not bad, although keep in mind they have to front $200 worth of steering wheel to make that $30, so I don't think anyone is getting rich selling steering wheels....
I'm not sure that wound up being quick.