A Critical Look: More Industry Turbulence as Horizon Drops Traxxas

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When Traxxas dropped Great Planes as a distributor in mid-2017, I assumed it was a power-play; the opening salvo in a battle to cut ties with all distribution and secure a larger part of the overall price of their products for themselves. Instead, it later appeared to be more related to the slow-motion collapse of Hobbico and reflected the latter’s inability to keep up with payments for products, and Traxxas simply cut them off.

Horizon’s Dealer Announcement

“Beginning in 2019, Horizon Hobby will no longer be distributing Traxxas products. We intend to carry Traxxas until our inventory is depleted, which we expect to be at the end of 2018. Our goal is to support you as needed through the holiday season.

We know your customers want choices. With our proprietary and distributed brands of surface products, Horizon offers a broad selection of the best products. Top surface brands such as ARRMA® and Axial® have been added to those brands you’ve come to trust from Horizon, including Losi®, Pro Boat®, Vaterra®, and ECX®.

You can count of Horizon to continue providing you with great, innovative products backed by outstanding service. We are committed to giving you choices and making it easy for you to do business with us.”

This past Friday, Horizon Hobby informed retailers they will no longer be offering Traxxas products, starting the beginning of 2019. With little further information, we are left to make assumptions on our own as to the reason(s) behind this move, nevermind who ultimately made the decision. Was this Traxxas improving their profit margins by cutting off their last major distribution partner, or was this Horizon ratcheting up the tension between the two companies, between whom there appears to be little love lost?

I suspect, without corroboration, this to be a choice made by Horizon — an effort to further force their surface products on their dealer network and attempt to stem the Traxxas tide. Cutting Traxxas out of their repertoire, however, won’t fix the intrinsic problems within Horizon; their surface offerings are a gigantic cluster&%@$, with multiple brands for each category.

It was just announced that Vaterra would, somehow, survive the acquisition of Axial, but would be relegated to low-cost (and likely, therefore, lower quality) scale vehicles. ECX survived by going to a hobby-shop-only model, angering fans of the brand who don’t live near a hobby shop. Instead of combining brands, picking only the best offerings of each and simplifying their surface category, Horizon is opting to offer a whopping eight surface brands: Team Losi Racing, Losi, ARRMA, Vaterra, Axial, ECX, Dromida, and Revolution, with the last three being distributed only to hobby shops. There’s too much overlap, too much chaos.

Horizon had an opportunity to reboot their tragic mess when they picked up the Hobbico brands. They could have done away with all of their brands, instead restructuring it all as “Horizon” and cutting out all the cruft. Stripping away the redundant vehicles and slimming down their line could have allowed the opportunity to better support the vehicles they kept making, perhaps offering various hop-ups and aftermarket products — much like the manufacturer they just dropped does for their own vehicles.

This move won’t harm Traxxas; given Traxxas’ enthusiastic drive to recruit hobby shops to deal directly with them, it’s unlikely this will truly impact most retailers — which could be a reason Horizon is doing this now. This could also be a response to Traxxas’ new dealer pricing structure, which incentivises carrying exclusively Traxxas surface products. Whatever the case, Horizon’s surface brands are in no way a substitute for the clean and organized state of Traxxas’ products.

I’ve had my fair share of Traxxas disappointments, to put it mildly. I’ve also been very supportive of Horizon in the past. I’ve also praised Traxxas and criticized Horizon when it was called for, and now, perhaps more than ever, it’s called for. We’ve been buying direct from Traxxas since they cut off Hobbico more than a year ago, so this won’t really harm us. We will have to discontinue selling Traxxas Top Fuel in gallons (quarts should be readily available), but that’s not a big deal in our largely post-nitro market; demand has dropped over the last few years. No, this is just another indication that Horizon, once the pillar of friendly business and a true partner of ours, has decided to make it harder to do business with them. It’s a business relationship dying by a thousand cuts, one at a time: refusing to sell Testors paint individually, ditto glow plugs, dropping K&S Metals, dropping Traxxas… each decision making it just that much harder for us to give them money.

We’re currently in talks with another hobby distributor who sells general hobby merchandise. We have no plans to stop buying from Horizon — far from it. If the past year has shown us anything, however, it’s that we can’t afford to rely on any one company for everything, because any seemingly small change that one company makes can have a tremendous impact on us, and the only way to lessen the blow is to have alternatives. Horizon is but one arrow in our quiver, and thanks to their own actions, it’s becoming less and less utilized as time marches forever forward.

Author’s Note: This article was updated to reflect the new availability of Traxxas’ Top Fuel in quarts.