Leica Slow to Refocus WSJ Article Link
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sweathog
Well-known
Very interesting article, certainly very interesting.
I am one of those younger buyers for whom Leica does not enter the conversation.
With the exception, perhaps, of the Nocti, I could never justify to myself buying Leica glass when I can get something just as good for significantly less money (and at the end of the day, money is the bottom line in the decision making).
I am one of those younger buyers for whom Leica does not enter the conversation.
With the exception, perhaps, of the Nocti, I could never justify to myself buying Leica glass when I can get something just as good for significantly less money (and at the end of the day, money is the bottom line in the decision making).
rsl
Russell
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They (Dr. Kaufmann) were thinking they'd like to make enough money to stay in business. I hope they do, but I sure wouldn't want to be a stockholder at this point.
Tuolumne
Veteran
Actual sales numbers for Leica Camera - and a big loss
Actual sales numbers for Leica Camera - and a big loss
The WSJ article was both funny and sad. Funny because it included a photo of a genuine Leica Elf, old and wrinkled, dressed in a white lab suit and white hair net, his fish-white, gnarled and wrinkled hands grasping an M8 perched on top of some sort of collimator (it looks like). Of course, all the elf appears to be doing is diddling the focusing cam of the M8, so the collimator must just be for show. Hysterical photo (see below.) Bavarian farmers meet 21st century electronics! 😀
On a very sobering note, Leica sales are down - way down. We speculate about this quite a bit here, but this is the first time I have seen actual sales numbers for Leica Camera. Mr. Kaufman owns 96.5% of Leica Camera, the remainder traded on the Frankfurt Exchange. The annual revenue for its last fiscal year was 150 million euros, or $213 million dollars. Sales for its first fiscal quarter, ended June 30, were 26.999 million euros, less than half of the previous year's first quarter. The company has a loss of 3.85 million euros for FY 2008. It anticipates a loss approaching 10 million euros for the fiscal year ending March 2009. Mr. Kaufman, the acting CEO, estimates that sales have to grow by about 66 percent to 250 million euros to finance the R&D spending Leica needs to stay competitive in digital markets.
It is hard to see this happening based on the new products and prices Leica has announced. Without the money to finance R&D not enough new products can be introduced to reverse Leica's death spiral. This is why I believe we see such a disappointing set of features in the M8.2: not enough money to invest in anything more spectacular. And the fall in Leica's quarterly revenue shows that it is not immune to weakening retail markets around the world, nor that its cachet is enough to carry it through lean times.
/T
Actual sales numbers for Leica Camera - and a big loss
The WSJ article was both funny and sad. Funny because it included a photo of a genuine Leica Elf, old and wrinkled, dressed in a white lab suit and white hair net, his fish-white, gnarled and wrinkled hands grasping an M8 perched on top of some sort of collimator (it looks like). Of course, all the elf appears to be doing is diddling the focusing cam of the M8, so the collimator must just be for show. Hysterical photo (see below.) Bavarian farmers meet 21st century electronics! 😀
On a very sobering note, Leica sales are down - way down. We speculate about this quite a bit here, but this is the first time I have seen actual sales numbers for Leica Camera. Mr. Kaufman owns 96.5% of Leica Camera, the remainder traded on the Frankfurt Exchange. The annual revenue for its last fiscal year was 150 million euros, or $213 million dollars. Sales for its first fiscal quarter, ended June 30, were 26.999 million euros, less than half of the previous year's first quarter. The company has a loss of 3.85 million euros for FY 2008. It anticipates a loss approaching 10 million euros for the fiscal year ending March 2009. Mr. Kaufman, the acting CEO, estimates that sales have to grow by about 66 percent to 250 million euros to finance the R&D spending Leica needs to stay competitive in digital markets.
It is hard to see this happening based on the new products and prices Leica has announced. Without the money to finance R&D not enough new products can be introduced to reverse Leica's death spiral. This is why I believe we see such a disappointing set of features in the M8.2: not enough money to invest in anything more spectacular. And the fall in Leica's quarterly revenue shows that it is not immune to weakening retail markets around the world, nor that its cachet is enough to carry it through lean times.
/T
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rsl
Russell
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I certainly agree that Mr. Lee was a very bad choice, but Dr. Kaufmann had to do something and that was the choice he made. It probably seemed like a good idea at the time.
Unfortunately perhaps, the WSJ article is right on the money, especially the part about Leica being on the wrong side of history. Henry Posner’s remark that “When it comes to younger consumers, Leica typically is not part of the conversation” pins down the problem. It isn’t just the younger generation either.
The rangefinder is a dying breed. It’s still king of the street for those who know how to set up the camera at f/8 and hyperfocal distance, and understand it’s to be carried in hand, but the rangefinder has been far surpassed by the DSLR in every other arena. There will be (probably violent) attacks on that statement. And it’s true that with the proper accessories and great patience you can do many kinds of very good non-street work with a rangefinder, especially the Leica. But doing those things with a rangefinder instead of with a good DSLR is like crossing the lake in a rowboat. You can do it, but it’s a hassle. Nowadays there are better solutions.
What’s staring Leica in the face is the fact that point-and-shoots are getting better very rapidly. It won’t be long before point-and-shoot quality will rival Leica quality, and in a similar sized box, at prices that are a fraction of what Leica must charge if they’re to stay in business. At that point Leica’s street photography advantage will vanish. I know I’ll be told again about Leica’s “spectacular” lenses. They’re certainly spectacular, but some recent Nikon lenses are at least as spectacular, and with the kind of automation available nowadays it’s possible to build “spectacular” lenses for a lot less than Leica charges.
I still love the rangefinder, but I loved film and darkroom work in their day. Unfortunately, it’s time to say, “sayonara.”
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vieri
Leica Ambassador
Not much risk for you to be one, Dr. Kaufmann owns about 96-97% of Leica (if not all of it), no board, not (many) stockholders at this point...
Back on topic, I sure hope they do reverse the trend, and that the good Dr. (Kaufmann) knows what he is doing. It's possible that he invested a lot of money (maybe even a lot out of his own pockets) in R&D this year - see all the new lenses - and thinks to pick the fruit of this next year or the following year if he plans to invest more in 2009. At least, I hope so 😀
venchka
Veteran
Different strokes
Different strokes
Obviously the M8 market is saturated.
My unprofessional, oversimplified view of the European vs. USA business model:
Europe: Make 1 million Euros from 1 unit.
USA: Make 1 million dollars from 1 million units.
The USA model won't support things like Leica cameras and lenses. It will support cheap film and chemicals for old used Leica cameras and lenses. That works for me. 😀
Different strokes
Obviously the M8 market is saturated.
My unprofessional, oversimplified view of the European vs. USA business model:
Europe: Make 1 million Euros from 1 unit.
USA: Make 1 million dollars from 1 million units.
The USA model won't support things like Leica cameras and lenses. It will support cheap film and chemicals for old used Leica cameras and lenses. That works for me. 😀
vieri
Leica Ambassador
infrequent
Well-known
i think the most telling line was:
"All I kept hearing was 'this can't be done.'"
the other was that traditional dealers were not too keen on internet marketing and sales. this is a double edged sword. direct internet sales would mean that Leica could pocket a bigger share but with a major buy like that customers prefer the continued support of a dealer.
"All I kept hearing was 'this can't be done.'"
the other was that traditional dealers were not too keen on internet marketing and sales. this is a double edged sword. direct internet sales would mean that Leica could pocket a bigger share but with a major buy like that customers prefer the continued support of a dealer.
35mmdelux
Veni, vidi, vici
interesting.." When it comes to younger consumers, Leica typically is "not part of the conversation.""
No wonder the Summarits are showing up discounted several hundreds of dollars..As a second lens it is not a problem for me.
No wonder the Summarits are showing up discounted several hundreds of dollars..As a second lens it is not a problem for me.
Gary Sandhu
Well-known
Oh I don't know, Leica might surprise us. I sold an M8 just last year, and just bought another from popflash. This despite having bought a Nikon D700 and a slew of lenses.
summaron
Established
It was a good article but I would have liked it if they had compared Leica's fortunes with those of Zeiss. They ran neck and neck for years, and today both produce superb 35mm lenses but Zeiss does it almost as a sideline, a hobby, whereas it's Leica's main business.
1066
Member
Leica, I suspect, is in more serious financial difficulties than the article alludes to. Survivability in the camera industry is predicated upon, among other things, market share and volume sales. Leica has neither. The possibility exists that there will be some form of partnership opportunities for Leica which will provide some infusion of capital, but for that infusion Leica will have to develop a more popular product to bring money in. Maybe a lesser version of a digital RF will result...who knows...but without the capital Leica is facing a very uncertain and perhaps a very bleak future.
Tuolumne
Veteran
They will probably be broken up and sold. Some one will buy the brand name. Leica won't disappear - it will just turn into Bank of America. 😀😀😀
/T
/T
Solinar
Analog Preferred
I read the article yesterday. It was the classic example of a "square peg" manager with probably excellent intentions trying to fit into a "round hole". There is a big jump from the mega-retail "Best Buy" business model and the existing company culture at Leica.
I found the quote by "Henry Posner" to be poignant. It will be tough to put Leica back on the radar of more photographers, especially the button pushers.
I found the quote by "Henry Posner" to be poignant. It will be tough to put Leica back on the radar of more photographers, especially the button pushers.
jack palmer
Well-known
Well Gary you're one of the few who can afford $125.00 spark plugs and buy and sell expensive cameras on a whim while most of us are just average Joes.🙄
feenej
Well-known
Lecia should do what Harley Davidson did. Back when I was a teenager, nobody thought all that much about Harley, and we all took it as a given that they would die off. Now people worship the brand, and wait in line to pay (what I consider) absurd amounts for a copy. Here in Milwaukee a few weeks ago, between 175,000-300,000 people came from all over the world to celebrate the 105 year anniversary of the company. They just built and opened a Harley museum here too. The trick is how the heck did they do that turn-around?
http://www.harley-davidson.com/wcm/...nzDH0J0dH!-1841759430!-657059173&locale=en_US
http://www.harley-davidson.com/wcm/...nzDH0J0dH!-1841759430!-657059173&locale=en_US
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Joerg
Dilettant
BTW Robert Capa used Contax cameras with Zeiss lenses 9and Rollei...)
;-)
Ciao
Joerg
;-)
Ciao
Joerg
Tim Gray
Well-known
Are you sure they didn't come for Bruce?
haha
I would have.
As far as the M8, I don't think the market is completely saturated yet for a digital RF. Its just that if I'm going to pay $5k+ for a camera, it better damn well be the camera I want, and the M8 is not that yet. At some point, I would like a full frame companion to my film M's, but as of now, that camera doesn't exist...
feenej
Well-known
They had a really impressive line up of music. Lots of big name bands. We all figured that they were trying to make up for the Elton John thing that happened at the 100th year anniversary, when the band was to be a surprise, and people thought it was going to be the Rolling Stones, etc. but when the curtain came up, it was Elton.
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