Oh dear, pinball machines are too expensive! Back then, they were given to us, and now we have to buy them for over ten thousand euros.
We’ve all heard these phrases, and sometimes echoed them ourselves. But we also know that looking at a price in absolute terms doesn’t make much sense, because inflation makes a currency lose value. In concrete terms, one euro and one dollar today cannot be compared with one euro and one dollar in 2001.
Our friend Zex, a friendly financial analyst, likes to confront preconceived ideas to find out if they are true or exaggerated. And we’re going to share his findings with you.
- 1 Calculating the adjusted price of a pinball machine
- 2 The absolute price of a new pinball machine
- 3 A pinball machine costs less in the USA today than it did in the 1990s.
- 4 The analysis rip-off: pinball machine ranges?
- 5 A similar situation in Europe? Not sure.
- 6 What will be the future of pinball machine prices?
Calculating the adjusted price of a pinball machine
It’s true that pinball machines cost more today than they did twenty years ago, in absolute terms. But we forget that, at the same time, salaries have also risen. Yes, you may think the world is going badly, but in reality it’s not.
The first thing Zex did was to look up the evolution of the average American’s salary. As the pinball market is mainly in the USA, we can only understand the evolution of the market by comparing sales prices with the incomes of the main customers.
Here are a few bullet points to help you understand what we’re talking about (source: Statista):
- In 1995, the average American salary was $34,076
- In 2000: $39,238
- In 2005: $45,647
- In 2010: $53,235
- In 2015: $59,993
- In 2020: $71,655
- In 2021: $75,447
In less than thirty years, the average American salary has more than doubled in absolute terms. This doesn’t mean that american citizens are twice as rich as before, since consumer prices have also risen.
So let’s compare the price of a new pinball machine with an annual salary. In concrete terms: with an annual salary, how many pinball machines could you afford thirty, twenty or ten years ago? And today? You could say we’re calculating a consumer price index for pinball machines 😀
The absolute price of a new pinball machine
First of all, let’s look at the price of new pinball machines at the time they went on sale. The analysis focuses on machines from Stern Pinball, which has the merit of covering the last twenty years:
- 1995 – Attack From Mars = $3,799
- 2001 – Austin Powers = $3,295
- 2007 – Spiderman = $4,295
- 2008 – Shrek = $4,495
- 2009 – 24h = 4 595$
- 2009 – Lord of the Rings Limited Edition = $6,499
- 2010 – Avatar
- Pro = $4,799
- Limited Edition = $5,999
- 2013 Star Trek
- Pro = $5,395
- Limited Edition = $8,795
- 2016 Ghostbusters
- Pro = $5,995
- Limited Edition = $8,795
- 2017 – Aerosmith
- Pro = $5,999
- Limited Edition = $8,999
- 2018 – Deadpool
- Pro = $5,999
- Limited Edition = $8,999
- 2019 – Stranger Things
- Pro = $6,099
- Limited Edition = $9,099
- 2022 Rush
- Pro = $6,999
- Limited Edition = $11,099
Between Attack From Mars in 1995 and Rush Pro in 2022, prices multiplied by 1.8. And salaries by 2.2. In concrete terms, Americans can afford a few more pinball machines today than in 1995.
A pinball machine costs less in the USA today than it did in the 1990s.
Now that we’ve laid the groundwork for our analysis, let’s take the price of our pinball machines and straighten it out with the Consumer Price Index, a piece of information provided by the US government. This index measures price trends for consumer products. So if the adjusted price of pinball is rising, it’s because it’s growing faster than other everyday consumer goods.
Stern inaugurated range logic in 2010, and almost all subsequent manufacturers have followed suit. The graph below is based on Pro versions.
We can see that the adjusted price of a “New in Box” Pro pinball machine fell considerably during the market crash at the turn of the 2000s. It then gradually climbed back to its initial value in 2016.
Since then, the decline has begun. Is competition forcing Stern to curb its price rises? Perhaps, as the market leader holds around 75% of the market, it can allow itself to contain its margins to prevent smaller players from nibbling away at its sales. This hurts the challengers more than the leader.
In short, whether we take the average wage or the consumer price index as a reference, the conclusion is the same: a pinball machine costs less in 2022 than in 1995, all other things being equal. Counter-intuitive, isn’t it?
The analysis rip-off: pinball machine ranges?
You’ve probably noticed that the price trends below are based on Pro versions of pinball machines, not Premium or Limited Edition versions. If we were to compare the adjusted price of an LE model to our famous Attack From Mars game without the range declination, the conclusion would not be the same.
To each his own: does a pinball machine from the 1990s correspond to a Pro, a Premium or a Limited Edition of today? Our approach is to look at the entry price of a new pinball, without considering the options it may or may not include. Buying a pinball machine is more affordable today than it was back then, period. Some will say that the machines of the 2020s aren’t as good as those of the golden age, in terms of the quality of the materials, world under glass, originality of the toys…
And it could be argued that back then, codes were simpler, DMD animations less beautiful than on an LCD screen, licenses less expensive or non-existent, and connectivity absent. Everyone weights the criteria for comparison as they see fit, and there’s no need to debate personal taste.
A similar situation in Europe? Not sure.
OK, we’ve talked a lot about the Americans, but what about European Union ? Can we come to the same conclusions? It’s hard to say, because the cost of purchasing depends on a number of additional parameters that can completely obscure manufacturers’ commercial strategies:
- the dollar/euro exchange rate
- Customs fees
- Shipping costs
- Importer’s policy
Price differences between distributors also exist, as there is no real “recommended retail price” as in the USA. Nevertheless, we note that the prices charged by retailers are fairly close to one another in one specific country.
We lack historical data on pinball prices over the last thirty years to carry out a similar exercise in the EU. However, consumer price indices all seem to show that inflation is lower in Europe than in the United States.
It is therefore highly likely that the adjusted price of a pinball machine has risen significantly in the Old Continent. Europeans would then be “victims” of the inflation differences between the two areas. But when we look at the significant variations we’ve seen in the UE over the last two years, just by taking into account changes in the euro/dollar exchange rate, we can’t be too sure.
What will be the future of pinball machine prices?
What can we predict for the future? A recession is probably just around the corner, and distributors on both sides of the Atlantic already seem to be struggling. Sales of pinball machines have dropped significantly in 2023.
Less demand means lower prices? To a certain extent, on end-of-stock items for example, but don’t expect rock-bottom prices on new models. Take a close look at Stern’s prices above, during the 2008-2009 crisis. No drastic drop! On the contrary, prices continue to rise, and the range logic adds another layer to the average basket.
It’s likely that Stern will apply the same tactics as fifteen years ago: it will reduce production volumes to bring supply into line with demand, but will not cut prices.
What’s more, production costs are not going to fall, because energy costs are unlikely to do so. And energy, ladies and gentlemen, is the fuel of our world. If its price rises, inflation is guaranteed on all economic indicators. If its availability decreases, an economic crisis is certain.
So we’ll have contained prices, perhaps a few bargains on end-of-production games, but not a profusion of half-price pinball machines hot off the assembly line.