Skip to comments.Can Colt Firearms Survive?
Posted on 05/24/2014 8:35:48 AM PDT by mac_truck
I recently had occasion to read through the S.E.C. 10Q filing for the newly formed Colt Defense, which is a limited liability corporation comprised of New Colt Holding, Colt Manufacturing, Colt Defense Technical Services, Colt Canada, Colt Finance, & Colt International among others.
The merged company has brought the manufacture of Colt long guns and Colt hand guns together into a single enterprise, however the company reported a loss in the most recent quarter and the sale of long guns was reported down more than 50% from a year ago (~24million in Q1 2014 vs ~52million Q1 2013).
Some of this decline may be attributed to the wind down of the conflicts in Iraq and Afghanistan, as well as greater competition for US military contracts.
Colt signed a 12 year lease deal with Osceola County Florida in 2011 for space which was intended to bring manufacturing jobs to central Florida. That property remains vacant and undeveloped and it is unclear whether the merged company plans to move there once the lease on its manufacturing plant in Connecticut is over in 2015.
Colt Defense has become highly leveraged as a result of its acquisition of New Colt Holding and is given a negative CCC+ rating by Moodys. Its revenue is down significantly from the same period a year ago, and there are covenant restrictions on how much new spending it can do. They do have increased sales on back order ($222 million Q1 2014 vs. $207 million Q4 2013), but much of that is government orders for spares.
The question really is whether Colt Defense and its iconic American brand can survive in this economic environment, or will they get purchased by a competitor with deeper pockets, or be forced to file for bankruptcy?
Nothing they make other than the Colt Python can’t be found at other companies cheaper and better.
Doomed unless they do a serious reorg
They could re-locate to Russia.
It’s much more business friendly...
If I were them, I’d move the company to a gun friendly state, re-issue the Python then consider merging with another company.
If they don’t stop funding statist fascism on Connecticut, do they deserve to survive?
My bet would be they get bought by Ruger- RGR or the new ATK spinoff. (ATK has a division that make ammunition under the Federal and CCI brands, and owns Bushnell, Savage arms Blackhawk, etc.
Was it Colt, or S&W that said that they would only sell to government agencies? If it was Colt, they can kiss their asses goodbye. My semi-auto “hunting” rifles will run circles around any of their AR or M16 variants anyways. Modern gunsmithing can produce some truly awesome custom firearms.
This is a prime example of business majors ruining yet another business.
Colt to come back has to do some basic stuff.
1) Move out of CT. Texas seems to be a popular choice but I fear for it's political climate if amnesty goes through, regardless getting out of CT is the important thing.
2) They need to focus on their core strengths and markets.
a)Colt AR/M4/M16 etc. With the huge rise of AR sales Colt should have been riding a wave a money, instead they priced themselves out of a market while sticking to their "mil-spec" (really colt-spec) AR. They need to change their spec and lower their prices. If they can't make a competitively priced AR they need to invest in the tooling so that they can.
b)Colt Python. Make the Python again you F'ing idiots. What were you thinking?! Make it just as good as you used to (or better) so you don't ruin the legacy.
c)Colt Peacemaker. The peacemaker is a classic pistol but let's face it, there are plenty of companies making period revolvers that are every bit as good and less than half the cost. If it requires more investment in tooling to bring prices down get it done.
d)Colt .45 ACP. They should have dominated this market. They need to get it back.
e)come up with some functional Tupperware pistol that "tacticool" kids like. focus on trigger, accuracy and reliabity in order to beat the G name that shall not be mentioned (This is a low bar set by the "perfect" company)
Boom, Colt would be in the money again. To whatever business major idiots are running this company into the ground: How did you manage to do this in a time of record guns sales? You are probably laughing all the way to the bank when you should be hanging your heads in shame...or just plain hanging.
Their hand gun business has been doing pretty well (~$15.5 million Q1 2014 vs. ~$1.2 million Q1 2013), its their long gun sales which are deteriorating.
Too much reliance on the US military for revenue, and now that seems to be drying up. International sales might be a way to grow.
That seems like a no-brainer especially if its to a right to work state, and they have a property in Florida that is already under a long term lease. They could just be waiting until next year when the lease on their Connecticut facility is up for renewal. There may also be an existing union contract to deal with.
Colt .32 semi,
The original carry gun.
Soooo why did they stop making it?
Bringing back the Python is something I’d love to see, but would it sell today? It appears that a lot of people these days are going for 1911s, Glocks, Springfield XDs and the like. A lot of Tacticool.
Same with the Peacemaker.
If Colt wanted to do something different, design a die-hard piston driven AR, then let others make it cheaply under license. It would create a common platform for the Piston AR crowd taking the proprietary systems out of the picture. Ruger, Adams Arms, Osprey, H&K, Sig Sauer all proprietary. It would take sales from the larger companies, and possibly the smaller ones too. DPMS, and Bushmaster seem to be thoroughly reviled on the interwebs these days, and a lot of “Tier 1” fan boys out there would not buy a piston set-up from those manufacturers. Colt still has a name, people WILL buy based on that alone. There are lot of diehard 6920 fans out there, who swear by their Colts. There would still be source of common piston parts on the market, and people would also buy from Colt, or upgrade to Colt made parts.
I love my Delta Elite; it’s one of my favorites sidearms. Granted, the 10mm is a very niche market, but if they would make a double stack 10mm (along the lines of the ParaOrd P14), they would have one of the most fearsome sidearms on the market.
IF (and that’s a huge “IF”) Colt were to make the Python to the same level of quality it displayed in say, the mid 60’s to the mid-70’s, and they brought back the Royal Blue finish, then yes, they’d sell.
But, here’s the kicker: That level of quality in a revolver is going to cost some serious money - as in $2K and up.
It would be a niche market, for sure. I don't know how many bullseye target shooters there are anymore.
Do you think a 10mm pistol could be made to cycle .40 S&W in the fashion of the .357 mag/.38 spcl?
I suppose someone would have if it were practical.
I totally agree with you on the price point. I think the larger question would be whether they have anybody left on the payroll that has the hand-polishing and -fitting skills to achieve the legendary finish, fit, and like-glass-breaking trigger/hammer action. If they do, they better pay those people to stick around and teach it to another generation if they want to hang their hat on the Python as part of a comeback strategy.
How about they start manufacturing ammunition. Buy a gun package & get cases of ammo.
I was recently gifted a 4” Colt Python, nickle plated. It is the finest revolver I have ever fired.
No, and the reason why is how the cartridges headspace in their respective chambers.
Revolver cartridges headspace on the rim (or, more precisely, the front edge of the rim).
A semi-auto case like the .40 or 10 headspaces off the front edge of the case mouth. This means that the .40 has nothing but the ejector hook holding it from headspacing too far forward into a 10mm chamber.
The .40 killed the 10mm, mostly because the only difference between the 10mm and .40 is achieved by loading the 10mm to its real potential, which is well above what the .40 achieves, and high enough to cause some 10mm pistols to start developing issues like frame/slide cracks, etc. As a result of the ferocity of the full-house 10mm, the FBI down-loaded the round to give the ballistics of what became known as the “FBI load” in the 10mm, and that in turn fostered the .40 S&W when Smith noticed “hey, that load leaves all this unused space in the 10mm case, so why not just cut down the case, and we get a smaller grip size and we can double-stack it?” Lo, the .40 resulted.
The only solution (real solution) I would see to cycling a 10mm auto with a .40 S&W cartridge would be to obtain another un-chambered barrel for the 10mm auto pistol, and chamber it for only the .40, and then you’d be off to the races.
Colt probably doesn’t have anyone on their staff that can do it, but they can be trained. There’s all manner of graduates coming out of gunsmithing programs across the country’s six or so schools of gunsmithing who would love to have their names attached to making something as nice as a Python.
And yes, they’d need to be paid.
I call "BS". Current machine tools and metallurgy are cheap and vastly superior to 1960's and 70's technology. There are lots of very good and inexpensive guns today because of improved technology.
I own two Colts. One is a stainless Combat Commander. The other is a 4” Python with the nickle finish. The Python is a piece of jewelry. The Commander is a Series 80. Both are wonderful guns and I wouldn’t trade them for anything.
When it came time to purchase AR pattern rifles I didn’t even consider the Colt offerings. Crappy triggers and way over priced. I’ve seen dozens of AR rifles at ranges but I have never once seen a Colt. Rock Rivers are very popular here in IL. The quality on those is excellent.
The American market for "boutique" handguns is limited, and Colt hasn't been on the cutting edge of handgun development since anyone still living can remember. They can make lovely "genuine Colt" (snicker) SAA and 1911 variants for those who have to have such things, but I don't see much potential for growth. There is always some market for Pythons, Detective Specials and 1851 Navies if they could make them as of old, but again, handguns like that are not what people are regularly buying and shooting these days, and most investors are sharp enough to know it.
As for the slump in long guns, their ARs really are the yardstick by which others are measured, and not priced much more than "just as good" (but really aren't) imitations. I suspect there are a lot of people who couldn't find/afford a Colt AR during this last buying frenzy, and they bought the lower-tier stuff that WAS available. These people are now cash-poor and sitting with a sub-par competitor's carbine tucked away in the closet. Colt's production may have finally caught up, but in the meantime, potential customers (including those suffering from buyer's remorse) are getting relentless blows to the pocketbook courtesy of Obama & Company. Bad bit of luck, that.
I should have known that. Thanks.
The 10mm seems a bit much for most uses. I recall the same issue with the .41 mag. There were full boat hunting loads and a reduced load. Police who tried them mostly used the hunting loads in their duty guns and didn't like the .41 becuse of it. A good idea that never caught on.
I have both an auto .45 and a .45 single action Ruger. I like them both, I think there’s a market for both.
Bersa makes a superior product in .32 acp and Colt could not match the price and possibly not the quality. It is truly a superior copy of the Walther PPK.
I’ve built several ARs with piston kits from various sources. The SOprey Defense is the best choice, with the least parts to fail, is darn near self cleaning, and works like a sewing machine ... approx. 2500 rounds through one I built on a 14 inch flash pinned gun.
You’ve obviously never seen the inside of a Colt revolver, much less the fit and especially the finish on a Python.
The metallurgy of the Python doesn’t enter into the issue. The metals used in the 60’s are largely the same metals being used today in firearms, with some additional options offered in the stainless alloys. AISI 4140 was plenty good enough back then and is still more than good enough today. if you want to case or color case a firearm, AISI 8620 is what you’ll likely be using.
The problem for Colt in replicating the Python is twofold:
1. The “bank vault lockup” of the Python (and the tighter lockup of Colts in general) was the result of hand-fitting several critical components in the Colt DA revolver design. The rebound bar in the Colt design was where it all came together, in a multi-faceted boss on the right side of the rebound bar which possessed a number of angles that timed the lockup and rebound of the lockwork. This is where Colt revolvers get their reputation for “finicky” lockwork. S&W made it easier to achieve an adequately tight lockup more cheaply with machined-to-size components by splitting their revolver actions into two springs. Colt’s design, using only one flat mainspring to power both the hammer and trigger rebound in the revolver, makes the fitting of tenths of a thousandths of an inch rather critical.
2. The finish on a Python, the legendary “Royal Blue” blue job, required polishing that cannot be done by machine. It has to be done by hand, and skilled hands at that. The things that amateurs look for in a polishing job is “is it shiny enough?”
The things that professionals look for in a gun polishing job is “are all the features and corners still there when that level of polish has been achieved?” You can tell when a hack polishes a gun for a blue job, any blue job. The corners, features and edges are all rounded off. They went to town with a damn buffing wheel and they blew off all the stuff that they didn’t know someone was looking for. The result is a gun with washed-out features to (in an extreme) what I would call a “melted” appearance.
People who think that hand fitting and polishing can be replicated by machine are the same people who buy vastly over-priced guns, and then are disappointed when they learn what to actually look for in a high quality gun. Machines can’t get into the nooks and crannies, machine-finished guns aren’t finished on the insides, etc.
There’s a reason why the market of high-end guns is narrow - there’s just not that many people who know their ass from a warm rock when they’re looking at a gun. People who appreciate the highest levels of quality are looking for quality in very specific areas of a gun, and then they don’t see that quality and attention to detail, they won’t pay up.
There is. I like the Ruger product line. It is a well-made product, and they get their prices down by extensive use of investment casting.
This is where I get a giggle out of the ‘forged vs. cast” endless debate by gun people. Ruger makes investment case guns. They finish-machine and polish the castings, and Ruger’s castings are hell for strong. Look at Ruger’s single action revolvers, as an example. They’re some of the strongest, most affordable SA revolvers out there. About the only thing stronger is the Freedom Arms product.
Ruger’s products are so strong that reloading manuals often call out loads specifically for the Ruger SA’s, especially in .45 Colt.
You’re absolutely right.
The 10mm was a riff by Jeff Cooper off the .41 Mag, which was Elmer’s fondest dream realized.
Both Elmer Keith and Jeff Cooper put too much emphasis on the idea of a cop taking long range (like 50 yard) shots with a handgun. Today’s cops can barely hit anything at seven yards, so equipping them with a long-range handgun just means that more people, animals and property downrange are in more substantial danger.
The 10mm and .41 are both excellent cartridges, but they’re really now consigned to the limited number of people willing to pony up the money for the high-end handguns to handle them, and the practice needed to use them competently.
Personally, I wish that S&W would put out a product in stainless that holds five rounds of .44 Special, with, oh, a 3” barrel. For me, that would be an ideal CCW revolver.
Colt was never the same after they bowed the knee to the unions.
I had the same thought. Colt also made the 1991A1 in .40S&W. I tried playing around with various components, mags, barrels, recoil springs, extractors, etc., but could never get the .40 to feed reliably from the mag, best case scenario, usually at least one stovepipe of per magazine. I was hoping to have a 10mm/.40/.357 Sig combo set up with the same slide and frame, but abandoned the idea when I couldn't get the .40 to work reliably.
The problem for Colt is that the margins aren't as good for commercial long guns as they are for the military versions, and of course commercial sales cannot match military' sales for volume. The other problem is the 'build to order nature of their products which takes both time and money to produce.
What Colt needs is a large military order from a country that values quality and performance over price, and maybe wants to distinguish itself from its neighbors.
Mmmm... no, not really... the margins depend on being able to control the ability of competitors to make a functionally identical weapon at a better price.
In economic terms, “rent seeking” is how Colt used to make money on the M-16/M-4. They held the rights to what is called the “technical package” on the M-16, all the specifications of how the gun was made, finished, tested, etc. The government didn’t set all the compliance data, the Colt technical package did.
As long as Colt could control that, they could control what the government paid for them, since Colt effectively gamed their way into being a single-source bidder on the contracts by requiring any competitive bidder to add $X to their bid on each gun to account for the cost of licensing the Colt technical package.
AR’s and M-16’s/M-4’s are now a commodity item. Everyone knows how to make them. Improvements are being made all the time, by a large (and increasing) number of vendors. Colt will never again achieve the level of margins they enjoyed throughout the 70’s to 90’s in making guns for the DOD on contract.
Margins for commercial long guns are good, depending on your market.
For example: Compete with Remington and Mossberg on a no-frill,s cheap-assed pump shotgun? Margins not so good.
Compete with the Italians on side-by-sides and O/U shotguns? Oh, there’s a nice margin in there for those who want to compete.
The reason why is that the .44 Rem Mag is what everyone thinks they “need” in a .44.
The last thing I’d want to carry concealed is a .44 Mag. Lots of noise, flash and recoil that I don’t need.
The .44 Special, like the .45 Colt, is a grand older cartridge with nice low pressures, lots of flexibility and the ability to launch really heavy bullets. I think a 5-round, stainless revolver in either round would be the bee’s knees for CCW.
Sadly, everyone appears to be chasing the plastic semi-auto market these days.
Gross margin is the difference between revenue and cost before accounting for certain other costs. Generally, it is calculated as the selling price of an item, less the cost of goods sold.
Colt has a better margin on its military long guns than on its commercial long guns. This information comes from their own literature.
Nothing they make other than the Colt Python cant be found at other companies cheaper and better.
A 586/686 with a trigger job is as good or better ,, my model 10 (full PPC custom) rocks.
Other companies do better “AR” rifles ,, S&W has always been the wheelgun king and Ruger kills Colt in pistols ...
I’m in Orlando and was hoping for a job at Colt when they announced Osceola (Kissimmee) ..
Colt probably doesnt have anyone on their staff that can do it, but they can be trained.
Outsource to the Philippines ,, they have top notch companies there that private label arms for US companies ... paying $10 a day for skilled assembly gets product on the shelves and Colt in the black.
I thought Taurus was making a 44 special Tracker but they may have dropped it. I know of a guy (non-reloader) with a SS three inch 41. He does not like the blast and recoil but carries it when backpacking in the sticks. He figures that if he needs it for real recoil and such ain’t what he will be focused on :<)
I also would like a stainless 44 as you described but with a heavier barrel than a Bulldog.
Yes, though I personally lean towards blue steel and walnut. 240 gr loads in a small five shot wheel gun would be very comforting. So would healthy loads in a six shot DA .45 Colt with a 5" barrel for a side arm. Lots of punch without all the fire show.
I do love the .44 mag, but it is work to shoot those heavy guns well. Fatigue sets in after while and beyond that you end up just burning (expensive)ammo. On the other hand, a single action .45 is just fun to shoot.
Hope you have a great weekend!
They did from 1996 to 2002, the Model 696 on the L frame (same as the 686). You can't fire really hot loads in it because the forcing cone in thin, but a 240 grain semi wad cutter at 850 fps will take the starch out of a problem. Best to look for a 696 or 696-1 because they were made before the lock. I've got one and it's a nice piece.
See my #42 re Smith 696.
I’d buy a couple 10mm to 40 conversion barrels for my S&Ws and Colt. I’ve read reports of some shooting 40s in heir Springfield 10mm Omegas but am not interested in doing so.
Sort of recall that. Very nice. Would be even nicer if they could squeeze that into a K frame. Still, I would grab one if the chance arose.
Hope yer good Slim!
As long as they still have some US government contracts they are set for a glide path. But if they want to compete the Europeans (ironically) and Israelis are making amazing small arms that militaries are adopting all over the world.
Personally I don't want a piston driven rifle. It solves one problem and creates worse problems. That being said I wouldn't buy another plastic pistol either but that doesn't mean there isn't a market for them. They could carve out a niche with a piston rifle.
I think if they made a spec rifle (piston or GI) with the quality Colt is known for, at a competitive price, they would have a winner.
I have no idea what problems you imagine are inherent in piston driven ARs, but I have built several and have found two that run flawlessly, the Osprey Defense and then the Adams Arms. I prefer the Osprey because it is so trouble free. But the dialability for pressure of the Adams Arms version is good, too. I would guess that around 10 to 20 thousand rounds I may need to replace the drive rod ont he Osprey, but running cool in the bolt and such attributes makes it well worth it.
The problems with a piston are accuracy, additional reciprocating mass, and at least in the AR, additional wear in the receiver. No piston AR can touch the GI AR in accuracy, and that alone is enough reason to ditch the concept IMO.
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