+1 for il padrone's summary of the arithmetic.
I can offer several examples from my own recent experience:
1) Researching the various options for a Rohloff-based touring bike a couple of years ago, I looked into buying a custom bike from True North Cycles, a small and respected manufacturer near Toronto. One of their custom machines would have cost me about C$6,000.
I bought a Thorn Raven frameset, sourced hubs and lighting online from Europe, other components from UK and US suppliers, my LBS build the bike. Total cost was about C$4,000, ⅔ of True North's figure.
Other price points were a complete Raven from SJSC, about C$5500; and the same for a Tout Terrain from Peter White in New Hampshire.
For me, the choice was obvious, and I would say that my Raven is very good value. It's quality gear, but at $4,000, it's expensive. I was fortunate to be able to finance it by selling an old, restored and hence desirable motorcycle.
A further note on the True North bikes: They're fine-looking machines. Earlier this year, I met a guy from Ottawa riding one -- we were both on a ferry near of all places, Auckland, NZ. I've also been in touch with a guy who rode his across Canada this past summer. He lives a couple of hundred kms south of Ottawa, and decided to buy the True North because its maker is three hours' drive from where he lives. Reasonable enough, but for me, not enough to spend an additional $2,000. [I did learn from him, however, that there's a Rohloff repair specialist in Toronto, whose shop is a short distance from my daughter's flat :-) ]
2) The arithmetic plays out in similar fashion in other examples, unrelated to Rohloff hubs. In the past few days, I have been pricing a renewal of my ti-framed Eclipse touring bike, which I now use for (slightly) faster (if less comfortable) day rides. First on the order of business was a set of steel forks to replace the slightly scuffed carbon forks of the Eclipse.
I used as a reference point the Mercury 853 forks from SJSC, £240 (less VAT, plus P & P), about C$500.
I then discovered that Velo Orange offers an entire frameset for their Pass Hunter rando bike for about C$700 (plus P & P). Thorn's product quickly became only a reference point for dimensions and weight.
My research ended with better news still. My LBS makes and sells their own brand of rando and cross bikes, "Steelwool". Happens that the guys had a bare set of forks in older unsold stock, and that I can get those for $100 -- painted by (read this and weep, you lot) Guiseppe Marinoni's shop in Montréal.
The historical footnote here is that, when they first conceived and designed their Steelwool bikes 10 or 12 years ago, they priced making their frames here in Ottawa. Well… Home-made framesets would have cost about $1500 each; products of comparable quality from Taiwan, landed in Ottawa, about ⅓ of that. Guess which option won out?
There's no mystery here. That arithmetic is the product of much larger production runs in Taiwan, depreciation of capital equipment required to make the farms and forks, and of course cheaper labour; and of under- or un-costed CO2 emissions in both production and shipping. If and when the latter are included in the final price of frames and forks, local frame makers here or in the UK, for example, might get some protection from the currently lower production costs in Taiwan.
