Fender’s CEO Andy Mooney has said that the high-end instrument market is still “very robust” despite current economic conditions.
In an interview with The Exchange, Mooney discussed how the issues of shortages and a competitive labour market were weighing on the sales of Fender instruments.
“Sales are starting to soften particularly at low end,” he began. “High end continues to be very robust so the 16 million [sales] we recorded was US only, we estimate that 30 million incremental players came in during Covid and some of them are starting to trade up already.”
However, with the cost of living crisis hitting the UK and with an ongoing war in Ukraine, Europe, Mooney does acknowledge that it will be a challenge to manage sales in those areas. He said, “I see costs coming down in only a few isolated areas – transportation would be one but almost everything else is heading in the upper direction [such as] labour costs worldwide.”
He continued, “I think Europe broadly will be the most challenging region to manage next year because energy costs are going through the roof, labour costs are also going up there along with the other inflationary… fortunately, Asia Pacific is very robust right now, it’s our fastest growth region, [but] Europe is gonna be a real challenge.”
Mooney concluded by adding, “The good news is I think when the dust settles and we start to normalise demand it will be a much higher revenue plateau for the entire industry than it was pre-COVID.”
After data revealed in 2018 that women make up half of all new players, Mooney described the finding as a “complete shocker” to Fender in a recent October interview, adding that these buyers were largely purchasing acoustic guitars.
He said, “Women were buying guitars online because in the brick-and-mortar stores there was nobody to relate to, and they weren’t getting treated well.”