Colt Going Down? Market says ...

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I do. I can't think of a single sporting goods/outdoor goods company that would want to be associated with guns that's not already associated with guns who would have the means to buy Colt.

Deserved or not, being associated with guns is very uncool in many places.

Colt isn't a sporting/outdoor goods company. It is now Colt Defense LLC. The pentagon says they are spending 7.5 mil a day on a new war in Iraq. Colt is finding new investors who want to speculate in the defense industry. CCMS LLC just loaned them another 33 million a few days ago. The companies that are loaning Colt money now are speculating and positioning themselves to be the primary creditors in a bankruptcy. It has nothing to do with a sporting/outdoor goods company "having the means to buy Colt" The company is already 90% owned by creditors. You don't loan someone 100 mil without having the loans secured in some manner.
 
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Colt Defense?....

Not to split hairs or be that guy, :rolleyes: but to my understanding, Colt changed the Colt Defense name in 2014 as part of the big re-structure plan. This was part of the cash/$ bail out that kept Colt in business until approx 2018.
The retired USMC general that ran Colt Defense quit & Colts top execs decided to change a few things.

Rusty
edit: I just checked Colt.com , the new company name is Colt Manufacturing Company LLC. It's no longer Colt Defense LLC. The website also lists investor/$$$ details.
 
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I disagree with the statements from Aragon.
Guns and shooting sports accessories have boomed in the last ten years or so.
1000s of new gun owners & CCW holders are out there now.
Guns or related industries may not be "popular" with everyone but a well run company could bring Colt back to a profit.

Stay focused on what I commented on -- an established corporation/conglomerate buying Colt. It's just not going to happen unless the company is already making guns or gun related products.

To a huge part of the US (I'm not sure if it's more than half or not?), guns are taboo. Not merely unpopular, but taboo. That's why places like Sears and KMart no longer sell them -- and all the more amazing that Wal*Mart does, although Sam Walton did begin with guns/hardware so that might have something do with it.

The only thing that's going to bring Colt back is relief from much of its debt.
 
It's not the location nor the unions. It's four things:
Commodity product: the 1911 and the AR are commodity products. Made by many with little value in variation, the ability to generate margin with a commodity is often a function of efficiency.

Nope. The Colt name/logo ASSURE a premium price can be charged to many looking for a M1911. Heck to many, it's not a 1911 unless it's made by Colt.

Thus: Old manufacturing facilities: Colt has not invested in modern manufacturing facilities. To be competitive building what they sell they need close to cutting edge manufacturing techniques to lower their costs and raise their quality without human intervention. And if they did, they may not need as many employees but those that they would employ would have to be highly skilled.

Not really. Colt Defense and then Colt's Manufacturing finally moved from the archaic Coltville plant some time ago. They have plenty of CNC equipment these days. That's not to say they shouldn't have updated far sooner then they did or that some lines (line the Python) should possibly have been retooled rather than junked.

Government sales: despite what you read, particularly for less than cutting edge products, it's very hard to make money on government contracts. Lots of people make money up and down the line ensuring that the governments costs are high but that doesn't mean lots of profit goes to the vendor. Between MFN (most favored nation) deals and other ways to squeeze a small or mid-size manufacturer, it's not a great business. And if its a big part of your business its even tougher.

Having a mix of private and gov't work is actually quite healthy for a business. Nothing is lower margin than a competitive commercial market.

Bad management: it seems pretty clear that the last rounds of management didn't have the company's success in mind. Heavy refinancing with little to no modernization of facilities or investments in new products or marketing. It seems like a money pump to turn sales and refinancing in to profits for the executives. It's a real pity.
But that is business. Both in the U.S. and elsewhere in the world. That is, there is both good and bad. But this one smells like toast.
That the government won't prop them is no reflection on the current president and his administration. It's because it would be a very bad investment.
Someone will buy the name, just as they did Springfield. It won't impart any sense of value to me.
B

Bad management indeed -- since at least the end of WWII and probably close to Sam Colt's death. Nothing new. Colt has made significant investment in PP&E but it took them forever to do it and a lot of money was taken out of the company.
 
Some here don't seem to be aware that it's been years since Colt produced firearms in their old plant in Hartford, CT. I think USFA and not Colt was the last to produce guns in this building:

AB-020608-M19-Colt-Building.jpg

Ironically when Colt was saved in the late 1980's, one of the stipulations by the State of CT was that Colt was not to move from its historic building which is now slated to become a national park. How times change...

Colt's current facility is a rather pedestrian looking place in WEST Hartford, CT.

Google Maps Link
 
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Colt isn't a sporting/outdoor goods company. It is now Colt Defense LLC. The pentagon says they are spending 7.5 mil a day on a new war in Iraq. Colt is finding new investors who want to speculate in the defense industry. CCMS LLC just loaned them another 33 million a few days ago. The companies that are loaning Colt money now are speculating and positioning themselves to be the primary creditors in a bankruptcy. It has nothing to do with a sporting/outdoor goods company "having the means to buy Colt" The company is already 90% owned by creditors.

Wrong.
 
If asked 100 Americans at random in nearly any section of the USA what are the 3 most common firearm makers they'd probably say:
Colt Firearms, S&W and Glock.

Why? Because the Colt brand(much like S&W) has a long & rich heritage in American culture. Right or wrong, it's very well known even to 1000s of non gun owners.

It sounds like if Colt circles the drain, it will be bought out & stream lined by some conglomerate or large corp that will scale back on the firearms/handguns then only fabricate the military & government contracts.

Likely Winchester, Colt, Remington, Glock and S&W.
 
Post #78....

I completely understand the point you are trying to make in post #78, I just disagree with it.
US gun sales have increased in the last 5/10 years greatly.
There's really no forum member or gun industry worker who would dispute that.
In turn, 1000s of new CCW and gun permits have been applied for(in most cases, like mine, paid for).
Is that a taboo?
Not really.
The fact that Sears or KMart or Montgomery Wards no longer sell firearms isn't a social taboo, :confused: . These stores are going under. Sales or profits drive their business.
Some places like San Francisco, LA, Chicago, Baltimore, CT, HI, etc may have strict gun laws or anti 2A views but recent changes(2005-2015 or so) are making guns/CCW more accepted.
 
I completely understand the point you are trying to make in post #78, I just disagree with it. US gun sales have increased in the last 5/10 years greatly. There's really no forum member or gun industry worker who would dispute that.

No, you're not getting it, that much is clear. It's not a matter of strong sales (which are now slowing by the way.) It's about being in a business that's taboo to a great many Americans. That's largely why Cerebus is trying to peddle Remington -- pressure from their investors who object to firearms. In some cases, companies who build and sell guns have run into financial issues where banks and other institutions have been pressured not to do business with them.

Why do you think General Electric isn't neck deep into porn? It's a legal business after all and hugely profitable -- more profitable than Hollywood! They don't because it's a socially taboo business that would cast a pall on the rest of their company. Now you might say "what?!? trying to compare guns to porn?" I'm not -- but they're both legal businesses and they both have a high taboo factor to a great many people.

In turn, 1000s of new CCW and gun permits have been applied for(in most cases, like mine, paid Is that a taboo? Not really.for).

See above. Small potatoes in the greater scheme of things. Those also aren't the people who buy companies and often not stock.

The fact that Sears or KMart or Montgomery Wards no longer sell firearms isn't a social taboo. These stores are going under. Sales or profits drive their business.

They haven't sold guns in years. Go do a bit of research and discover exactly why KMart got out of guns. Dig around a bit and see why Target, the Home Depot, Costco and others have never gotten into the gun business.

Some places like San Francisco, LA, Chicago, Baltimore, CT, HI, etc may have strict gun laws or anti 2A views but recent changes(2005-2015 or so) are making guns/CCW more accepted.

Again, so? On what scale?

There is another very serious issue facing gun makers -- the market. The gun market in the US has for many decades been cruelly cyclical -- feast or famine. That's not open to debate as it can simply be looked-up.

The market has been strong for guns in the US for quite some time. Hyper-strong as a matter of fact. The problem with that hyper-strong demand is that it has been driven largely by politics and fear. It caused a lot of people who never considered owning a gun to buy one or more. It caused others who had planned to buy another gun(s) somewhere in the future to buy now. Millions of guns were made and sold that were driven by this demand caused by politics and fear.

That means that a lot of future demand has already been satisfied. Because guns are very durable goods many of those guns will be bought, sold and traded on the used market for years to come to further satiate demands.

Much depends on how politics, disasters and attempts to further gun control go in this country in the next 2-3 years. If things finally calm down it could be a huge blow to the firearms market.

There's one final element that I find interesting. The AR-platform now dominates the market for target shooting, personal defense and now hunting for long guns. This platform is making it possible for far smaller and more nimble companies to compete with the Colts of this world. That's going to intensify the pressure on pricing and retaining market share -- things that would concern anyone considering a bid on Colt.

I think that a gun maker like FN or ATK will one day buy the assets of Colt at auction.
 
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It would make the most sense for Beretta to buy them. There's very little product overlap as Beretta doesn't make 1911s or ARs. Uberti makes copies of the SAA. Beretta is experienced at getting government contracts. And the could move Colt out of CT with their big relocation to TN. It would be an absolute win for both companies.
 
It would make the most sense for Beretta to buy them. There's very little product overlap as Beretta doesn't make 1911s or ARs. Uberti makes copies of the SAA. Beretta is experienced at getting government contracts. And the could move Colt out of CT with their big relocation to TN. It would be an absolute win for both companies.

I'm thinking it would be FN. FN already owns US Repeating Arms and sells under the Winchester name and it owns and makes guns under the Browning name. Colt would be a superb addition, depending on how much they would have to pay for the name. To this day, Olin still owns the Winchester name so it must be worth a great deal. Colt would be worth just as much.

I'm thinking that Colt's days as a mil contractor are over until they can get the commercial side of their house in order. Beretta would also be a very logical choice. I do think there would be some negative feelings if either FN or Baretta bought the Colt name though...
 
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Originally Posted by CoalTrain49 View Post
Colt isn't a sporting/outdoor goods company. It is now Colt Defense LLC. The pentagon says they are spending 7.5 mil a day on a new war in Iraq. Colt is finding new investors who want to speculate in the defense industry. CCMS LLC just loaned them another 33 million a few days ago. The companies that are loaning Colt money now are speculating and positioning themselves to be the primary creditors in a bankruptcy. It has nothing to do with a sporting/outdoor goods company "having the means to buy Colt" The company is already 90% owned by creditors.




http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=9898968



Still known as Colt Defense in the industry. I guess a lot of people need to catch up. Also they seem to be having an identity crises at Colt because they recently posted a news release using the name Colt Defense. If they don't know how do you know? Hmmm.

http://www.colt.com/ColtintheMedia/PressReleases.aspx
 
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Nothing is lower margin than a competitive commercial market.

You can't sell something cheaper than you sell it to the Federal Government. By law, the Federal Government price must be the lowest. As an example, my commercial hourly rate had a markup of 2.5 - 3.2 (depending upon the project, location, and client) while the Federal rate was 2.12.

If you sell something at a lower price than you sell to the Federal government and the auditors find out - you refund the cost difference and probably get fined as well. The way you make money of Federal contracts is through volume (size of the contract).
 
Quote:
Originally Posted by CoalTrain49 View Post
Colt isn't a sporting/outdoor goods company. It is now Colt Defense LLC. The pentagon says they are spending 7.5 mil a day on a new war in Iraq. Colt is finding new investors who want to speculate in the defense industry. CCMS LLC just loaned them another 33 million a few days ago. The companies that are loaning Colt money now are speculating and positioning themselves to be the primary creditors in a bankruptcy. It has nothing to do with a sporting/outdoor goods company "having the means to buy Colt" The company is already 90% owned by creditors.


http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=9898968


Still known as Colt Defense in the industry. I guess a lot of people need to catch up. Also they seem to be having an identity crises at Colt because they recently posted a news release using the name Colt Defense. If they don't know how do you know? Hmmm.

http://www.colt.com/ColtintheMedia/PressReleases.aspx

It's not only the name you got wrong.
 
Colt is stupid. They own perhaps the most valuable brand name in the gun business, but they don't have a clue what to do with it.

The marines ordered a buncha 1911s. Good! Capitalize on that by selling them to the public for $1k, not $2k (and a limited run at that). I can buy a Les Baer for $2k.

Re-release the Colt Python. Its the most legendary .357 in history, yet I've seen exactly ONE in my life. They're letting SW have the premium DA revolver market to themselves. Start selling DA revolvers again, and compete with SW on price.

To the average consumer perusing the shelves, Colt seems like a clueless relic from a former age. They need to start putting some effort into this. And for god's sake, get rid of the series 80's already!!!
 
We've already seen where someone from Colt said IF they ever started making Pythons again, they'd cost at least $3000. The same people that won't buy an original one now for $3000 sure won't spend that on one that will never have the cache of the originals.
 
Previously owned Pythons might be bringing $3k today, but they are not $3k guns. Colt could never sell new production Pythons for $3k.
 
Sooo....

With some of these recent posts; an increase in sales or profits doesn't mean anything :rolleyes: & if a established company changes the name or title, it doesn't matter :rolleyes:.

Members can post their own views or comments but I'm not going in circles here.


Seacrest out! :D
 
Premium? have you bought one lately?
The last one I bought was a 686 in around 1997 or so, and its a very nice gun. I've handled quite a few new ones in the store though, and they feel just as nice as that 686 does.

At any rate, SW seems to sell plenty of them, so there stands no reason why Colt wouldn't if they were at the same price point. As for "colt can't make a python for less than $3k", then they're stupid. Ruger makes a great revolver, and its even cheaper than the SW.

Outsource the Python to Ruger if you have to. Just an idea. The brass at colt needs to start thinking up ideas if they want to stick around.
 
As for "colt can't make a python for less than $3k", then they're stupid. Ruger makes a great revolver, and its even cheaper than the SW.

Outsource the Python to Ruger if you have to. Just an idea. The brass at colt needs to start thinking up ideas if they want to stick around.

You've obviously never owned a Python.
 
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