‘Economies of Scale’ is fake

The latest upload at American Radio Library is an internal RCA publication from 1940.

It lists patents and academic articles by RCA’s engineers, and has some articles about various parts of the company. One of those parts is the Export Division, which I hadn’t thought about.

Auto companies often made interesting variations for export, which turn Economies of Scale upside down. Theory tells us, and the companies often told us, that a large manufacturer can’t bother to tool up drastically different products for a few hundred or a few thousand sales. Reality was quite different. The Nash truck is a dramatic example. Chrysler gave the same engine and the same transmission to all US Plymouths ‘because scale’, but made an entirely different smaller six for export only. The tooling was worth it when it went abroad.

Most of our better radios had SW bands in the ’30s and ’40s. Other countries were more solidly ‘broadbanded’, with less activity on the 550-1600 BCB. Responding to the demand, RCA’s export radios had extra bands not used on US radios.

As war approached, the Export Division wrote that it would have to give up its dials and coils for LW, which was highly popular in Europe.

Imports from other countries generally went the other way, with Euro makers simplifying their products for US markets.

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For clarity: The title is exaggerated. Amortization is a stern taskmaster for small businesses. Large companies can afford to spend plenty of money on speculative projects or small-scale projects. At the level of GM or (ahem) Facebook, decisions depend more on executive desires than strict economics.