Cost breakdown of a lens EF & EF-S

[KimH]

I have been thinking about asking this for some time.

With the discussions about EF-S, M and Kit, Standard and L-Grade lenses i can't help but thinking what it actually cost to make a lens.

Some call it tear down, some COGS some...... Product Development is also a factor

Obviously material, volume and cost of production equipment matters a lot - written off over 8-10 years, but does someone actually know why a lens like the new 24-70 Mk II should cost 2.300 €/$/GBP versus the EF-S 17-55 ~1100 €$/GBP? are they really that far appart in cost?

 

[CanNotYet]

I would say a lot of the cost are in smaller tolerance levels.
For a 24-70mkII to be so darn sharp, the "exact-ness" of how the different glass parts are cut, layered and assembled is much higher than on a lower grade lens.

So, in one word: Precision.

 

[AmbientLight]

The issue here is one of sales volumes compared to target sales margin, production costs and development costs. Over time lenses profit from advances in development made earlier on keeping development costs in a healthy range, but expensive glass and lens coatings will remain a significant cost factor. You can't cheat here. There is no way to build a top-of-the-line L lens with cheap components and get away with it. This is easier in other industries, but with a lens you will be able to see the quality right away.

If you want to have a good comparison in terms of production volume effects you can compare Canon or Nikon lenses with Zeiss lenses made for Canon or Nikon mounts (lower sales volumes) or Leica M9 lenses.

 

[marekjoz]

My two 2 cents, but of course I don't know the exact number and it depends much on the lenses themselves.
Beside some minor reasons like making something popular or promotion, anything on the market costs as much as the customer can pay for it. The production costs are not so important at all.
If something goes to production and it was not a show off, then it means, that the production costs are lower than the sales price but the price (above production, transport and sales costs) is set to such a level, where the price multiplied by the number of customers, should give the maximum number (demand curve). That's it. The more you know the market and your customers, the more precisiely you can set this price.
So production costs can be from 10% level to 60% and there is nothing wrong with it. Let's assume that they cannot produce cheap wide lenses, but competition can and they are also so good as well. So they could be even forced to lower the price to the minimum profit margin. In other cases, like telephoto, where competition is not so strong, they can reach the sky and still there will be people who will buy it, almost no matter what the reasonable price is.
Does production of the sport cars really costs so much? Watches? Diamond rings?
17-55 is pretty expensive as EF-S lens anyway Precision is very important and can play very important part in these costs as well as materials, new technology, paying for other patents etc. But really? Does a precision really cost another 1000$? R&D costs play important role and they are also repaid in a longer time and depend on production volume. So first investment in R&D, later income.
Glass coatings? Of course. But is a difference of 10$ or 500$ on a lens? Maybe coatings in expensive lenses cost 5 times more than in cheap ones, but do we know if this is 10$ vs 50$? or 100$ vs 500$
But someone who makes 1000$-2500$ on one (of 15 in a month) photo session would care if the better lens costs 1500$ or 3000$?

 

[tomscott]

I doubt it is down to tolerance. A 20 year old machine can cut to a tolerance of 1 micron aka 0.03mm. It will be something to do with the quality of the glass, growing the crystals and the quality of each one, I would say the QC will be much higher so nothing with any defect in it what so ever. Also R&D the R&D in these products eventually trickle down to the lower models.

Like buying a top of the range S Class mercedes. It will have everything Merc can possibly do but a C class wont. Same with Canon, new coatings, design of the elements etc etc

Its not like the 24-70 is made of metal anymore its plastic...

I would say it is £2300 because they can charge it for it. Every pro will buy one, thats a lot of people.

 

[bbasiaga]

I think there is definitely a technological and performance difference between those lenses. Some of the tests show it. But also, as stated above, its the target market. The nicest EFS body costs $1600ish (7D). Most are less than $1k. Hard to sell a $2500 lens to those people, but if they thought they could get it Canon or Nikon or whoever would definitely price their 17-55 2.8 analog there. Pros need/want higher performance, and they get it with the 24-70 and they pay more for it. The margins are almost certainly higher higher on pro products, simply because it doesn't cost that much more to engineer or fabricate, but it brings a higher price in its target market.

I happen to know that a lot of stereo equipment is that way. A very nice Marantz or Onkyo receiver costs about 5-20% more than a mid-level sony or pioneer, but sells for 200-300% more.

-Brian

 

[Loswr]

No idea of the specific numbers, but much of the expense is the glass. In your example, the 17-55 has three aspherical elements, one of which is moulded glass and the other two are replica elements. The 24-70 II doesn't have a block diagram available AFAIK, but the MkI version of the lens had a ground/polished aspherical element at the front (i.e. the biggest, most expensive element). Also, many of the elements in the 24-70 II are larger than the 17-55, because of the larger image circle.

But as mentioned, mostly the price is a function of marketing estimates of what the target market is willing to pay...