Power Tools and Buggy Whips

The sale of the Pentair Tool Group has been on my mind for the last couple of weeks. Finally the pieces started to come together and my old paranoia helped me make this comparison.
First, you have to understand that I started my working career in the textile industry and watched that business move off shore. Then I moved to the bicycle industry and watched that move off shore as well. So my current views are tainted by what I have seen before.
For those of you who are subscribers to my newsletter, you may remember my article about TTI, "The Prototypal Chinese Manufacturer." That article was my first clue that something is going on in this industry. My next clue came several months ago when Atlas Copco announced it's intention to sell off it's power tool division including the power house brand Milwaukee Electric Tool Company. Finally, the sale of the Pentair Tool Group to Black & Decker sealed the thinking.
Power Tools have been the whipping boy of the hardware industry for some time now. They have been used as price leaders to get people into the stores for so long that I doubt anyone is making any money. Several years ago, I was talking to people at Skil-Bosch about a new battery powered tool and they told me that inorder to maintain their volume with the retail community that it was imperative that they reduce prices by 10% to 15% every year. New products were critical, but so was the ability to cost reduce the products.
The rise of TTI, the sale of Pentair Tool Group to Black & Decker and the offering of the Atlas Copco Power Tool Division all lead me to believe we are watching the demise of another domestic industry. High volume power tools produced in the United States are rapidly becoming a thing of the past.
The good news in this is that our cost to purchase power tools may in fact continue to decline. The other piece of good news is that there will probably be an opportunity for manufacturers to produce high quality, niche products in this country as the far east will concentrate on high volume, long lead time products. At least that has been what has happened in other industries that I have watched.