The electric guitar was invented in the early ‘40s in the USA.
Since then, American-made instruments have been the gold standard for the industry.
And as with anything golden, they come at a hefty price.
Some say it’s just hype, others argue that those price tags are well justified.
However, it’s now time to arrive at a conclusive answer about why are American guitars so expensive?
Here’s a short answer:
American guitars are expensive mostly because of how costly is labor within the US territory. This base level of cost restricts the pricing strategies available for US-made guitars and forces manufacturers to focus on building premium instruments locally while importing more affordable ones.
In this article, I will try to narrow down the main factors that influence the high ticket of American guitars, and explain how they affect the price.
After leaving this page you will have a clearer idea about why American guitars are so expensive, and if it’s just greed from the manufacturers, or their hands are really tied.
Are you ready to get started?
What makes an American guitar expensive?
First of all, let me begin with a counterintuitive concept:
Costs don’t affect prices.
The only things that define pricing are market forces. Supply and demand.
American manufacturers have a baseline of costs that sets their economically viable supply at a point where demand is met at a rather high price.
For lower price tags, there is 0 supply, because manufacturers couldn’t recoup their costs.
Now, the important thing to talk about is what drives those costs, and if there’s something possible to do about that.
The main factor driving costs up for guitars produced in the US is how expensive qualified labor is.
What a minimum wage worker makes in 1 hour in America is probably a week’s salary in many third-world countries.
And guitars are rather a labor-intensive good.
You see, although with the years, much of the rough work on bodies and necks are now made with machines such as routers, what’s very hard to robotize are the small detail-oriented tasks.
Sanding down machine cut guitar bodies, leveling frets, wiring the electronics, are all tasks that require expertise, and machines are not yet prepared to do at a lower-than-human cost.
Given this restriction, the only way out for manufacturers is to decide on making the best quality guitars possible in their US factories.
Since expensive labor drives the base cost of an American guitar up, getting premium materials is the way to follow through.
And even though wood is available throughout the country, many manufacturers choose to get exotic import tonewoods that are not cheap.
US-made hardware is not affordable either, and parts that require assembly, custom work, or expertise, suffer from the same problem.
Although originally electric guitars were built as just work tools, with the materials available at the time, with the massification of the instrument, those mediums began to become scarce.
Nowadays the original tonewoods and hardware of a ‘50s Fender Stratocaster are way harder to find, and what at the time were off-the-shelf components, now require custom orders and waiting.
But this is mainly because the rest of the industries shifted to more modern materials, while guitar manufacturers still insist on the same substances.
We can’t blame them, though. I have yet to hear a plastic guitar that sings as a ‘59 Les Paul.
Brand and hype
Over the years, brands have also become institutions.
You read Fender, Gibson, Gretsch, Martin and you know you are looking at a high-quality instrument.
Is there a secret brand tax added to the market value of guitars?
As there is with any other brandable good you might find out in the while.
Or do you think Rolex watches are really that expensive to make?
Brands signal status, and we all will trick our brains to hear the difference between a Mexican and an American strat as if it was day and night.
I’m not saying that US-made guitars are not better or higher quality than their import counterparts with this.
What I say is that “luxury” comes at a price, and many of us are happy to pay for it.
Are there cheap American guitars?
There are not really cheap American guitars, however, many manufacturers now offer stripped-down models of their most popular guitars at lower prices.
A great example of this strategy is what Gibson does with Les Pauls, for instance.
One of the most expensive features of this guitar model is its carved top.
Something beautiful, smooth, and very nice to the touch, but that requires a specialized workforce and extra time to be done at the quality standard an American guitar has to have.
The alternative to offer cheaper US-made Les Pauls is simple: Make them with a flat top.
Hey, why did I say top?
Make them with no top at all.
Are they still Les Pauls? I don’t know.
Do they compete in price with midrange Chinese-made Epiphones? They do.
Wouldn’t you consider them even knowing that they lack some defining feature anyway?
The higher perceived higher quality of American-made guitars is something players with a few years under our belts will find hard to shake off.
Is the higher price of American guitars worth it?
I think the higher price of American guitars is worth it most of the time.
But, of course, this isn’t applicable to all players.
Beginners will rarely find any benefit from starting out with a $2.000 American guitar other than bragging rights.
American instruments are premium products catered to the most demanding players that need, or think they need some extra feature, and can afford it.
It’s that simple.
You can also test it by yourself.
Go to the nearest music store and grab the 2 most similar American and import guitars you can find.
Do they sound abysmally different?
Is the (probable) higher price tag of the American one justified by what you hear and feel when playing it?
If the answer is yes, it’s worth it.
If the answer is “no way”, go get that cheaper import.
You are not wrong, either way.
Should you get an American guitar?
American guitars are not for everyone, and getting one is something you would have to consider and discuss, especially with your wallet.
But a great way of thinking about it is by just asking if an American guitar will give you something other guitars won’t.
Is it the attention to detail?
Is it the presumably better pickups?
Is it its construction?
Is it how it looks?
Or is it just the decal that says “Made in the USA” on the back of the neck?
Whatever it is, if you deem it worthy, by all means, get that dream guitar of yours.
Would there be any affordable American guitars in the future?
Given that the limiting factor for affordable pricing on American guitars is labor costs, one could speculate that until guitars could be produced without human intervention, prices are unlikely to go down.
But this completely automated way of producing that we are imagining here is practically impossible, at least with our current technology.
As I mentioned earlier, there are many tasks involved in the making of a guitar that are extremely hard or very costly to automate.
And although technical progress has signified an improvement in output and quality over the years, it’s unlikely that it will drive a noticeable reduction in costs in the foreseeable future.
More affordable alternatives to American guitars
To overcome the high cost associated with producing guitars in the US, and to serve a broader audience, American brands tend to outsource their student lines to factories abroad.
Many choose to do this with secondary brands such as Epiphone for Gibson, or Squier with Fender.
Others, like PRS, keep the original brand name, but label every instrument with the “SE” tag, which stands for “Student Edition”.
Whatever the branding strategy chosen, the alternatives are there, and the quality level of these instruments has been increasing decade over decade.
Hello there, my name is Ramiro and I’ve been playing guitar for almost 20 years. I’m obsessed with everything gear-related and I thought it might be worth sharing it. From guitars, pedals, amps, and synths to studio gear and production tips, I hope you find what I post here useful, and I’ll try my best to keep it entertaining also.