Ruger Results Show The Gun Boom Is Over. For Now . . .

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While I saw no obvious evidence of sales slack during my recent tour of Smith & Wesson’s Springfield factory, there’s no shortage of reports corroborating the general impression that the post-Newtown sales boom is well and truly over. In the sales panic that followed – which was really just an extension of the longer-running Obama-fueled sales boom – just about everyone who had even thought about purchasing a firearm found the disposable income to pick one up, no matter the price. But that demand surge has now cooled leaving excess production capacity and fully-stocked shelves — with the possible exception of ammo. To wit: the latest sales figures released by publicly traded Ruger, above, as reported by qz.com. The Southport, Connecticut-based manufacturer reported . . .

a 14% decrease in revenue, fueled at least in part by a drop in ancillary sales. As Ruger CEO Michael Fifer told listeners on the the company’s quarterly earnings call,

Our accessories business is much, much smaller than our firearms business, and last year, however, it spiked because [the politicians] were all trying to grab a headline and they were going [to] limit magazine sales, for example. And so what did the consumers do: they went out of their way to buy every magazine they could get their hands on, for fear that it would be outlawed, and they wanted to get them so they could be grandfathered.

He noted that NICS check volume is down 12% as well. So yes, gun sales are regressing back to the mean, something the laws of economics dictated had to happen eventually. And while the Civilian Disarmament Industrial Complex seems to have gotten the message that further movement on gun control – at least at the federal level – just isn’t in the cards, another incident and a renewed push for an assault weapons ban, magazine capacity limits or both could turn all of that around.

comments

  1. avatar ST says:

    Enjoy the trough while it lasts, folks. Election 2016 is around the corner.

    1. avatar BobB says:

      Yup, once the Hillarywitch runs, all bets are off–unless you manufacture firearms/ammo

    2. avatar S.CROCK says:

      You mean the 2014 election is right around the corner. If this election goes bad things could go south in a hurry.

      1. avatar Matt Richardson says:

        The same folks who thought 12 was locked in are making the same noises this cycle. It’s staggering how naive people are. Now the Republicans are suing the president. I wonder why politicians with an R next to their name don’t go pick up Democrat voters at their houses and drive them to the polling stations…

        1. avatar ChrisB. says:

          Matt, can you name a president that has not been sued by members of the opposite party?
          http://www.politifact.com/truth-o-meter/statements/2014/jul/31/sheila-jackson-lee/rep-sheila-jackson-lee-d-texas-says-we-did-not-see/

          The difference is Obama has been taken to court and LOST several times on his power grabs, and almost always LOSING court cases heard by DEMOCRAT judges.

          In case you missed it Obama just lost a suit concerning one of his massive administration power over-reaches the Supreme court — with EVERY Democrat judge agreeing it was an overreach by Obama.

          Just because the Dems and the mainstream media are LYING about what this , how even DEm judges have been ruling against Obama — and the history of this, those who are educated don’t have to believe it. The Dems rely on the cat that the average Dem voter is woefully ignorant on political history and facts:
          http://dailycaller.com/2012/04/22/science-say-gop-voters-better-informed-open-minded/

      2. avatar ropingdown says:

        I earnestly implore all the “conservatives” and “lovers of liberty” not to stay home this time, wallowing in self-pity, resentful that they are forced to vote for merely the lesser of two evils. Of course they are! That is simply how democracy works. If anyone feels highly motivated to vote for a politician because the pol has a glorious image that fulfills the political dreams of that voter…..the voter has been duped. Every politician as both personal and policy defects. You should HOPE that the lesser of two evils is elected. That’s the best you’ll ever get, and only if you and other liberty-oriented people vote. Please vote.

        1. avatar ThomasR says:

          Yep; It was a good thing Bush was elected instead of Kerry; Bush only gave us the Patriot Act; Water Boarding, Home Land Security, TSA, the greatest growth of government spending in decades and the Invasion of Iraq. Who knows what Kerry would have done?

        2. avatar ChrisB. says:

          ThomasR:
          1) Patriot act facts
          a) Truman (Dem) gave us the NSA
          b) Carter (Dem) gave us the secret FIDA courts that enable the abuse
          c) Yes Bush (GOP) gave us Patriot One (Kerry voted FOR it too)
          d) Obama gave us “Super Patriot” changes in 2011 that enabled prism and large scale spying on Americans

          2) water boarding
          a) a total of 17 people were waterboarded, one of those gave us Bin Laden, a number of others stopped attacks
          b) According to Amnesty international, three TIMES as many people have been tortured by the Obama administration.

          3/4) kerry voted for homeland security and TSA.

          5) Kerry voted for even more government spending than Bush supported. And government spending under Obama has increased

          6) Kerry voted to authorize Iraq war. He also supported the Clinton administration claims of WMD violations by Iraq that had us kill 500,000 Iraqi infants ages 0-5-years old with the Clinton era WMD/Iraq sanctions

        3. avatar ThomasR says:

          So ChrisB, your point I believe is that the Republican choice is the lesser of two evils, both choices give us bigger government, less personal freedom, more restrictions on our civil liberties; the Republicans just get us there a little bit slower.

          Now that’s a rallying cry that will get out the vote; “Vote for the lesser of two evils; vote Republican, we’ll still end up in a police state; but it won’t be as fast”.

          The Republicans; the GOP machine, in the end; is just as much a threat to our constitution and our freedoms as the democrats. No, the votes that make a difference will be at the local level; local elections will be what makes a difference; so many elections are decided by a small percentage of the voting population; that is where our voice will be heard. That, and the local sheriffs; vote for the sheriffs that support the second amendment.

        4. avatar AndrewinDC says:

          “vote Republican, we’ll still end up in a police state; but it won’t be as fast”

          If you could pare down verbiage, you might have a hell of a bumper sticker there.

        5. avatar ChrisB. says:

          “The Republicans; the GOP machine, in the end; is just as much a threat to our constitution and our freedoms as the democrats. ”

          That is a complete load of crap. if the Democrats win the Presidency, which they will if the GOP does not field a centrist candidate, then Hillary Clinton is a SLAM DUNK and will get quite a few SCOTUS appoints, and actuary tables say she will replace two justices that voted for Heller — and then it is game over.
          The Democrats are afraid of some legislative pushes on gun control but getting SCOTUS which we have by one vote, gives them total political cover and will END the individual right to own firearms.

          I live in DC and Virginia. We just LOST Virginia due to fielding a NUTCASE hard right GOP candidate — handing the Va govern ship and now in the governers mansion sits one of the most most savvy, smartest hardball players in the entire DNC.

          By the way, I am happy the al Qaeda inner circle was waterboarded, they targeted and attempted to kill 30,000 American civilians, and succeed in killing 3,000

        6. avatar John Galt says:

          ChrisB, please explain why the Virginia Republican candidate was a “NUTCASE.”

          Also, please explain why the state and national RINOs threw him under the bus and didn’t provide any significant money for his campaign.

    3. avatar Full Cleveland says:

      Isn’t it ironic that way down deep in the soul of every gun company executive, employee and stockholder, no matter how much they support 2A, they hope to hell that Hillary gets elected. I love capitalism.

  2. avatar The Brotherhood of Steel says:

    Now is the time to buy. Don’t wait to pay 3 grand for something that should be under 1 grand in 2016.

    1. avatar Grumpy F'er says:

      Under a grand indeed. My LGSs are positively swimming AR pattern, and wading in AK pattern rifles.

      Time to start haggling.

      Also, Bushmaster is offering packages for very reasonable prices.

      And since not all TTAG readers are rolling in cash, shooting 3-gun, or machine gunning hogs from helicopters…I’m looking at you Nick…if you’re looking for a “Chevy” plinker, Classic Arms in NC has some for $540. I’m sure other places as well.

      Using a local GS, ordering some parts, and buying a complete upper, I figure I can build a OK-to-reasonable M4 for about $500.

      Time to sell some plasma. :^)

      1. avatar The Brotherhood of Steel says:

        Yes sir. DPMS and Stag Arms each have some great prices going on right now too.

    2. avatar Desert Ranger says:

      True Wisdom, Brother,

      Mags, Uppers, Repair parts, all are at normal pricing. There will be another round of this war coming, afterall, War never Changes…

      1. avatar The Brotherhood of Steel says:

        Indeed…. “And the swiftness of the ranger is still talked about today…”

  3. avatar General Zod says:

    Not to worry, there will be another massive liberal push to ban any number of scary-looking firearms again, and sales will pick up. Like clockwork.

    1. avatar Avid Reader says:

      Plus there will be the inevitable clapping of hands and giggling among the antis in the media, claiming that this is a trend that shows Americans have come to their senses and stopped buying guns. Because guns are icky.

  4. avatar Tommy Knocker says:

    Yes elections are less than 100 days away for this year and 2016 is around the corner. Before you splurge again on extra mags or a gun, think of donating that money to a pro-gun group or pol actually and actively fighting for our rights. This might be your last chance to do so before the Republic falls.

    1. avatar Full Cleveland says:

      In that case I’ll hang on to the dough.

  5. avatar DJ9 says:

    In a related note, I’m seeing an awful lot of used pistols on the shelves of my local gun shops. They are reaching “glut” proportions, but prices have not yet begun to fall to alleviate the problem.

    Anyone else seeing something similar, or is this local to me?

    1. avatar B says:

      I have seen lots for sale, but being durable goods prices haven’t really dropped to indicate people *need* to get rid of them.

    2. avatar Ralph says:

      The inventory of used pistols and rifles in MA is still tight and has been for years. Ammo supplies are good, except .22LR which is more than spotty.

      1. avatar Rad Man says:

        On Cape my local guy has .22lr for $65/525 rounds. Needless to say I didn’t buy any. At the same time, I won’t shoot any of my stash either until prices drop at least a little bit.

  6. avatar Roy Bristow says:

    Despite the serious of the article I could not resist…..My guns still go Boom.

  7. avatar Tom W. says:

    Well, I hope the ammo mkt. follows suit.
    Still have 525 rd Remington .22 ammo socked away with the price marked $ 18.99.

    I’m sure Russian AK variants won’t see a decline. Thanks Obama.

  8. avatar Curtis in IL says:

    … so we should once again see smokeless powder on the shelves of retailers… when?

  9. avatar former water walker says:

    Yep I see lots of used guns-especially at Cabelas. Wish I had some $. Need to tie up a few with a layaway. I see lots of ammo except 22. And my local gun shops are still very busy(Illinois and NW Indiana).

    1. avatar B says:

      I’ve had 22lr on backorder from midway for nearly a year now. Really want that $59 bucket o 1400 bullets.

      1. avatar TexGal says:

        Good luck that. I finally cancelled same order you have in. Found 500 rounds CCI mini-mags recently at a good price to top off what Ipurchased pre boom.

      2. avatar tdiinva says:

        I have an inventory of over 5000 rounds of various 22LR brands. Just picked up 300 rounds of CCI at Dicks. My inventory never dipped below 2000 rounds and I never paid gunbroker prices. Every time I saw some I bought some but only enough to keep my 22 pistol and rifle fed. Now is the time that you should be stocking up on ammo not when the crisis hits.

  10. avatar Chip Bennett says:

    Awesome! I’ve been in the market for an SR40c for forever, it seems like – and also want to pick up a 77/357. Now that the market is regressing to the mean, I might be able to find one (or both), reasonably.

  11. avatar JW says:

    The ant-gun establishment is not done by any stretch.. Get involved with your state rifle association and send the liberal elitist’s home from state legislatures and congress. Never trust anything uttered by any politician, conservative or liberal.

    I see a lot more rifles and pistols on consignment. A few prices have come down especially on black rifles and plastic pistols. Meanwhile, Remington, Savage, Ruger …. are pushing entry level hunting rifles complete with scopes for less than $400. Black plastic stocks and not very fancy but they shoot straight and won’t rust if you leave them under the bad for a year.

  12. avatar ChuckN says:

    I wonder how much the continued economic recession/depression
    has come in to play considering the massive damage to disposable
    income as well as secured savings (IRAs, equities, CD etc…)

    Is/was there a bubble surrounding firearms and ammo sales;
    most definitely. But does the drop off in sales show a reduced need
    /want or is it an example of the continued fiscal disaster despite
    the usual supply and demand.

    1. avatar Cogitans says:

      The bubble could actually be quite large. Ruger’s actual fire arm revenue averaged $ 167 million real dollars between 2001 to 2007 with an average growth rate of -3%. From 2007 to 2013 average sales was 375 million with a growth rate of 24%. Last year Ruger sold over 678 million dollars which is 4x the average from 2001 to 2007.

      I think the question is, will Ruger return to pre-2007 norms or will it settle somewhere above? I’m thinking sales will drop precipitously, but won’t return to pre-2007 levels.

  13. avatar Tom W. says:

    Like the housing mkt., lots of folks find themselves “upside down” when they paid big bling for a “stock” AR, and now find out the mkt. reset and your $1500 Olympic Arms is only worth a 1/2 of that now. But my humble .02 cents is buy stripped lowers, pts. kits, stripped uppers, etc,….good as gold for the next round. Especially if we end up with the Hildebeast in 2016.

  14. avatar big blue says:

    I’m buying AR 15 parts now.. not to excess but prices are good now, and while they may dip lower I doubt much lower. At a certain point companies will just turn down production and lay off people rather than continue to crank products out.

  15. avatar Indiana Tom says:

    Somebody needs to get into the .22lr ammo manufacture. With the real prices up, somebody should be able to make money. I see a lot of ARs on the shelves and pistols in the gun cases. I do not think .22 rim fire guns are selling well. We may see shotguns sell better as supply on the shelves is actually less than other guns.

  16. avatar Scrubula says:

    Another buying surge WILL happen if they keep pushing the assault weapons ban, registration, confiscation, etc. It’s not a maybe or an if 🙂 . With that said, the recent supreme court decisions indicate a trend against ridiculous gun laws, so I doubt they will stand the test of time if they somehow get passed.
    Did you know that no one challenged the previous AWB directly against the second amendment? There wasn’t enough precedent. Now that it has been clearly stated that people have an unwritten right of self defense, banning features of firearms that are beneficial to self defense (short barrel, collapsible stock, flash hider/suppressor, etc.) is going to be tougher.
    Ammo manufacture needs to increase. They still haven’t kept up with the supply demands. I think the ammo companies don’t want to expand so fast that they crash, which makes sense, but the cheaper it gets, the more people will buy.

    1. avatar Geoff PR says:

      “I think the ammo companies don’t want to expand so fast that they crash, which makes sense, but the cheaper it gets, the more people will buy.”

      Economy of scale is pretty much as good as it’s gonna get on ammo.

      Profit margins will return to razor-thin, and the cost of brass, lead and powder are commodity prices. You can’t just wish the price of a commodity to drop.

  17. avatar Nigil says:

    Just bought my first Ruger not long ago. I don’t think Ruger will notice though…it’s a 1972 Bearcat.

  18. avatar Ralph says:

    Obama will get back to gungrabbing soon enough, but right now he’s still a little fatigued from all that fasting for Ramadan.

    1. avatar bontai Joe says:

      Ralph, I like your sense of humor, made me laugh out loud with that one

  19. avatar Tom in Oregon says:

    Haha.
    I’m still buying. Again. As usual.

    1. avatar Gunr says:

      Tom, just bought a Sig 938 today, couldn’t go home without it! Know anything about them?

      1. avatar Full Cleveland says:

        Me too!

  20. avatar Anon says:

    It will spike big time one day. Start thinking spare parts, you’re gonna need them.

  21. avatar big blue says:

    Thing about ammo production too, is these companies are in it for the long game. They can’t just magically create a new assembly line because the demand will be there for say.. 1 year or whatever

  22. avatar Bob20 says:

    Progressives always put their unpopular agendas on the back burner before elections, and then bring them back out right after the election. If you have been thinking about buying a new AR, you might want to do it before November.

  23. avatar Accur81 says:

    There’s no time like the present to build a reasonably priced stockpile of guns and ammo.

  24. avatar Joe R. says:

    If they can create a ‘boom’ they can create a ‘bust’ if manufacturers cannot stay Semper Gumby.

  25. avatar last marine out says:

    If Ruger wants to up sales , drop the price , The market ( supply and demand) sets the price , America wants guns but not at top dollar , Ruger makes nice guns , but their prices have always been high… a Ruger AR 7.62 at 2 to 3 thousand , is not following the market .. S&W AR’s for under $ 1600. is my point…the MP 15 and the MP10…….

  26. avatar Phil COV says:

    Buyers market! I’m still doing my part.

  27. avatar bontai Joe says:

    If the boom is over, then where is the .22LR? Still none on the shelves in my neck of the woods (northeast PA)

    1. avatar ChrisB. says:

      22lr is its own thing. I swing by a walmart about one morning a month to see if I can catch some. the clerk told me the same half dozen guys are there every morning, and it comes about once a week and they grab it all. if there is any left they are on the phone to friends. store opens at 6, same guys are lined up every day.

      22lr is cheap enough that obsessive compulsives can buy it all.

  28. avatar Sixpack70 says:

    I was shocked when I walked out of Gander mountain, yes Gander Mountain with a big 350 round box of brass cased 9mm and paid 28.5 cents per round. That is getting back to pre panic prices.

  29. avatar LC says:

    I’ve been stalking the Palmetto state armory page, got lots of good deals for military-spec lowers and uppers supposedly “blemished”

    5.56 ammo has gone down a lot. ordered another 5k rounds (brass).

  30. avatar Nedd Ludd says:

    The good thing about an industry wide slowdown is it encourages both innovation and lower prices.
    In the white hot sales environment earlier in BHO’s reign, just keeping up with demand was tough enough.

    Since most decent guns rarely wear out or break and with the easy sales environment now in the rear view mirror, most manufacturers will have to ramp up creative new ideas along with lower prices or watch their sales volume shrink.

    I think there’s still plenty of room for innovative products at the right price to drive sales.

    A good quality sub $1,000.00 Tavor/bullpup style .556 from a major maker
    would no doubt find a ready market.
    The same for a sub $1,000.00 .308 in either AR style or M1A style.

    The Holy Grail of a reliable 9mm carry gun – the size and weight of a Ruger LCP – would undoubtedly have a ready market.

    There seems to always be high demand for used pistol caliber camp carbines – so there’s room to bring those back.

    Kel-Tec’s scarce Sub-2000 folding rifle design has no competition either.

    I’m sure TTAG’s readers here can think of dozens more ideas.
    This is a good time for the industry to get creative.

    ======================================================================
    “It is the common fate of the indolent to see their rights become a prey to the active. The condition upon which God hath given liberty to man is eternal vigilance; which condition if he break, servitude is at once the consequence of his crime and the punishment of his guilt.”
    — John Philpot Curran
    ….

  31. avatar last marine out says:

    and forget not that Ruger was always P.C. and supported the Clinton magazine and gun bans, and Ruger has always been against imports of surplus military arms…that is called being anti-market,(greed) and we wonder why their sales are down asking top dollar …..Ruger needs to understand the public/market … took 25 years for them to start offering 30 round mags. again….

  32. avatar jimmyjames says:

    We will see what companies survive this boom and bust cycle. 2013 sales were unsustainable. The highest price LGS in my area had cases and cases of 22 ammo yesterday. Some as cheap as $30 a brick. He cant give an AR away. Savage Axis rifles stacked to the ceiling. His $45 a # powder marked down to $30. Remington shipping 700’s again. Now if prices would just get back down to 1970 MSRP.

  33. avatar CBI says:

    While the “boom” may be over, there is still an indication that firearms *ownership* is increasing. Based upon the above graph, and a little bit of spreadsheet arithmetic, revenues for the 2nd quarter of 2014 are still more than *three* times what they were in the 4th quarter of 2010. Assuming that Ruger revenue roughly corresponds with overall firearms sales, it may well be that the new mean remains higher.
    That’s a good thing for civil rights.

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