When your not a huge manufacturer, its cost a lot more to put out product. When you manufacture in the US, you are taxed a ton and have to account for that as well.
It really doesn't have that much to do with the size of the manufacturer. It has a lot more to do with how many units they sell. A very small shop could re-design, assemble, test, package and ship a huge number of M17S Bullpups if they largely relied on outside supplies to make their parts. And no, subbing out the parts doesn't always mean higher costs.
Think of it this way... the tavor is that price and they have been cranking them out for a long time on a high count bases.... why are they that expensive? Also, look at the machining of the aluminum recievers vs the polymer injection molding. Takes more time, equal more money. I actually really like the m17s... might have to look into one....
I'm not sure what you're trying to get to with your comments?
No way is the
cost of the Tavor the basis for the
price in which it is sold for. Absolutely no way.
The price of the Tavor is based upon what the market will bear -- most assuredly the current pricing of AUGs and other bullpups that number has been dropping as of late. Similarly, I'm sure the price of this new bullpup is based on the Tavor, AUG and other bullpups.
The Tavor is a mature product. I'm sure all product design costs have been fulled absorbed at this point. That leaves production, distribution and selling costs plus profit margins.
I suspect the hard costs to produce a Tavor are less than $300.00/unit -- Glock pistols are far less than $100/unit. Take the Tavor apart and compare its component pieces to firearms priced far lower and there's little difference.
I could see sales and distribution costs to equal 25% of actual production costs or $75.00/unit for a total cost of $375.00/unit. There are huge margins at every level (manufacturer, distributor and retailer) if they actually sell them for $1,800.00/unit.
That's a gross margin of 79.17% -- a stunningly high margin for firearms manufacturing. If IWI's sales of the Tavor continue to grow (they sold 20K units in the USA in 2013) it will attract competition and if sales continue to climb, prices will continue to drop as competition continues to increase.