Gun manufacturers struggling----why?

[mikelets456]

http://www.grandviewoutdoors.com/art....vOEBgOH1.dpbs

The Wall Street Journal reports that Colt Defense LLC has filed papers with the Securities and Exchange Commission indicating it does not have the funds to pay back loans and may default on its payments to bondholders.

According to the report, Colt is expected to declare a loss of as much as 60 percent for the quarter over last year, based largely on declining sales and delays in payment for government contracts. Colt told the SEC it may not be able to make a nearly $11 million payment next month on a $248.8 million loan.

- See more at: http://www.grandviewoutdoors.com/art....vOEBgOH1.dpuf

[nater99]

Some of these companies just got greedy when the panic was on and rampes up production. Now the market is saturated and things are going the other way.

[alpacaheat]

Says it right there, Government contracts not paying up and I bet there is some strategy involved in that to hurt Colt.

Related article on the industry, perhaps the cost of relocating also had an effect on that quarter's net income:

http://www.gunsandammo.com/network-t...panies-moving/

Perhaps it’s no coincidence then that New York-based companies such as Remington Arms, Kahr Arms and American Tactical Imports are all expanding into or moving to more gun-friendly states, as are Connecticut-based companies including Mossberg, Ruger, Colt, Stag Arms and PTR Industries.

[ungawa]

Colt is not "Gun Manufacturers" (plural). Colt has been running a shitty business for decades and has been very reluctant to service the Citizens of this nation. They ignored and completely missed out on the explosion of gun ownership from the 1990s right through to today, instead banking on military contracts with all their eggs in one basket.

As for the other companies mentioned in the article, everybody has losses in a quarter once in a while, especially in a slow-down after a boom. I'm sure they have far better books than Colt and have made record profits in prior quarters over recent years.

[dkf]

Colt is having financial problems because of their own bad choices. HK is in some of the same boat. There are plenty of other gun manufacturers and assemblers doing quite well. Ruger and Smith have done some expansion and improved in house processes. Couple that with the market slowing down from the post Sandy Hook surge and they may show some losses. A lot of guys burned up the gun budget and smoked the credit cards post Sandy Hook so it may take some time before they plunk down more cash.

[alpacaheat]

There's that too...the panic is temporarily on hold and the demand isn't as high right now.


I suspect that to reverse course fairly soon, especially in PA in oh, lets say January 20th.

[unclejumbo]

Yup, gotta agree. When you make government your focus at the cost of the civilian side of the market, you are very much at the mercy of your primary customer.

If Colt had any damn sense, they'd bring back the Anaconda, the Python and a host of other highly desirable firearms. Those Anacondas are routinely selling for $2000 plus on GB for a mass produced revolver full of shitty MIM parts.

Instead, they've focused on M4s which they are in competition to supply to the military. Didn't FN win the latest contract. Oops, guess you're screwed.

[wanneroo]

There was an excellent article out there somewhere about all of Colts issues going back years and it was chock a block filled with details about what a screwed up business it was. Now I can't remember where I saw it.

[dkf]

There was an excellent article out there somewhere about all of Colts issues going back years and it was chock a block filled with details about what a screwed up business it was. Now I can't remember where I saw it.

This the one?

http://www.businessweek.com/articles...s-after-crisis

Instead, they've focused on M4s which they are in competition to supply to the military. Didn't FN win the latest contract. Oops, guess you're screwed.

Yeah Remington and FN underbid Colt by hundreds of dollars per rifle. But Colt does get some royalties for the "secret sauce".

[unclejumbo]

This the one?

http://www.businessweek.com/articles...s-after-crisis



Yeah Remington and FN underbid Colt by hundreds of dollars per rifle. But Colt does get some royalties for the "secret sauce".

I guess they should have made a better deal. Oops, sucks to be Colt.