Becasuse there is a fundamental gap in the market expectation - the military price of TAVOR is about doubled that of the 450USD price tag from Norinco. However, the market put much more premium on Israelis products than Chinese. So the price of TAVOR could be much higher(same as swiss arms) than what it will normally be. In other words, the market doesn't see any significant values added feature in the type 97 that, using other Chinese products as reference, to warrant for the added price. Becasue Chinese product is not premium as seen by the market, the attempt to copy the price structure of TAVOR or Swiss Arms will backfire because the market won't support premium price when they do not recognize it as a premium brand.
On a more personal level, I see the Type 97 as a second choice to other designs due to some deficiencies. In order for me to live with these issues, it gotta be cheaper!! On the other, I do see how the price arrives to 1450-from a break-even analysis it probably makes sense to go after this approach if one is uncertain about the longevity of product availability, and you know some guys have to have them right now. However, it can be also a marketing strategy to build up the reputation of the type 97 as a premium rifle. Swiss arms and TAVOR are quite sucessful at that, but they do build good stuff in the first place. Of course, this strategy can also backfire if you do not have exclusive right to the product, or that the factory does not set up a Minimum Retail price policy. What will happen again is the M305 scenario....your competitor will butt in. However, if you expect a competitor to pull volume on you, you will want to go in and reap the first dib by going high margin if you know you will be out of the market in a minute.
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