Posted on 07/19/2004 8:14:13 AM PDT by Atlas Sneezed
Do with this as you will:
Smith & Wesson Comes Home... Almost
(from about.com)
This legendary gunmaker messed up bigtime in 2000. Will this buyout save the company?
May 15, 2001
Saf-T-Hammer Corporation announced on Monday (May 14) that they have purchased Smith & Wesson Corp. from Tomkins Corporation, a subsidiary of UK-based Tomkins PLC, once again bringing S&W under American ownership. What effect this will have on the shooting public's perception of the company - which is anything but positive - remains to be seen.
The gun-buying public's enmity towards S&W began in earnest in March of last year, when S&W signed an agreement with the U.S. Departments of Treasury, Housing and Urban Development (HUD) and local and state governments. Restrictions on individual gun owners per this agreement include gun rationing, mandatory gun owner registration, and mandatory training requirements (putting your rights on hold). Restrictions on gun dealers include mandatory employee training, no one under the age of 18 may enter an area in which guns are for sale without an accompanying adult, and forced submission to BATF harassment -- and those are just the high points. Full text of HUD agreement
Smith & Wesson, which had been for sale for some time, made what I'd call a huge blunder by entering this agreement, which ired gun owners across the USA. Word spread rapidly among gun buyers that S&W was cozying up to Bill Clinton and the rest of the gun grabbers, and that was all it took for the lion's share of us to stop buying Smith & Wesson's products. Obviously, buyout offers were not in abundance at S&W now that their market share was in serious jeopardy, and sales dropped markedly.
They didn't learn their lesson, though -- S&W entered yet another agreement in December of 2000, this time with the city of Boston. In this agreement (according to CNN.com), S&W "agreed to commit 2% of annual firearm sales to developing safety technology and design changes on triggers. The agreement largely mirrors one the company reached in March with the Clinton administration and some other states and cities."
Further distanced from the gun-buying public, S&W continued to wallow through the first quarter of this year. Despite a short-lived rumor that Sturm, Ruger & Co. was going to buy them out (which was quickly denied by both Ruger and S&W when I called them to ask about it), S&W seemed to be on a sure path to destruction. Will Saf-T-Hammer Corporation be able to save S&W from total destruction? That remains to be seen.
I spoke with Carol Heine (who's in charge of Saf-T-Hammer's Customer Service) about the buyout this afternoon. My first question was, naturally, "What will this do to the "deal?" Answer: They don't know yet. Saf-T-Hammer's attorneys are pounding away at it, looking for any "room" that may be built into the agreement, and I'm certain that Saf-T-Hammer is hoping (and searching) for a chance to renegotiate this agreement. After all, the HUD deal is what enabled Saf-T-Hammer to buy S&W for a mere $15 million (the Brits paid $112 million for it in 1987), and now it's time to start rebuilding the company's image (and therefore its worth).
Unfortunately, the Boston deal cannot be avoided or renegotiated -- at all. It won't be going away, and Ms. Heine confirmed that it is, indeed, "set in stone" -- while she quickly pointed out that it only affects the state of Massachusetts, rather than the entire USA.
With the HUD agreement still up in the air, it's too soon to tell what changes, if any, will be made to S&W's products in the future.
The good news is that Smith & Wesson is once again under the ownership of a company here in the good ol' USA. When I asked Ms. Heine if Saf-T-Hammer takes an official position on "lock up your safety" laws (which would require folks to keep their guns locked in their own homes), she said that although they're in the business of selling gun locks and similar items, they believe the choice should ultimately be the gun owner's to make. She also said they won't support any mandate that would require gun owners to lock up their means of self-defense. It felt good to hear these things, because these are the people who will be steering S&W from now on -- I feel, for the moment at least, that S&W is in good hands.
Knowing that Saf-T-Hammer's President, Bob Scott, left Smith & Wesson in 1999 due to problems with their policies, makes me breathe a bit easier, too. Mr. Scott is the former Vice President for Business Development for Smith & Wesson.
We'll all be watching and waiting to see what will happen with S&W from this point. If Saf-T-Hammer isn't able to renegotiate the HUD deal, they're in for a huge disappointment in their investment, in my opinion. I don't know any shooters who will more readily buy S&W products just because a little money has changed hands and the flag of the owners has become our own. We'll all be looking for results, along the lines of negating the HUD deal as completely as possible.
-Russ Chastain
What are your comments on post 61 ?
Thanks -- I think I will save this on a CD.
That'd be true if there were only a handful of manufacturers, but there are still many out there. There would be no oligopoly. The consumer would not suffer, the prices would not be affected (other than maybe a temporary bump as the supply side worked itself out).
Not necessarily. And what about the pensions (not to mention salary), health benefits and relocation costs even if a new position is available elsewhere?
Oh please. Do you think about the poor mom and pa shops you put out of business each time you shop in Walmart? You can not look at things this way. It totally counter-acts supply and demand and free market theory. They will survive, either they'll get another job using the skills they have, or if they can't they'll learn to do something different, and if they don't do either they will live off of my tax money. It really bothers me when people, and especially people who should know better, throw the "what about the employees" out there. People get laid off, fired, and hired all the time. Since when did the right to work turn into the right to keep a job? This is very liberal thinking.
That's very true, but you can't foresee the potential dampening effect on the market due to your external politically motivated meddling, no matter how righteous it may be!
Listen, professor, don't you think "politically motivated meddling" is part of the bigger supply-demand picture? Sure it is. I make all kind of decisions on what I buy and from who based on more than simply price and quality. Everybody does. Would you buy a movie from Michael Moore if you it saved you $.50 than if you ordered it elsewhere? I sure as heck wouldn't. Is it fair? Heck ya it is. If companies want business they better kowtow to their customers and not tick them off.
how many new producers of firearms have come on the scene with a high quality product? Do you see? Push one out, especially a producer with the volume, quality and custom shop line like S&W and it is not likely to be replaced
This is the only valid point you have made in all of this. This is the line you need to be arguing, the rest of it worthless (and wrong). Unfortunately, due to the threat of lawsuits and increasing hostile attacks from the left, I doubt we'll see many if any new manufacturers show up in the US unless legislation protecting idiots from suing them gets passed.
What about Kimber--
Kimber is not listed on the 1995 statistics table of pistol production by manufacturer---link -- www.amfire.com
Kimber appears to be a major supplier now.
Is yours a 9mm or a .45?
Excellent CF, but you forgot to mention (or I missed it) that you may only have a few seconds to make all of those assessments and act appropriately.
Just to add a bit of pressure to this otherwise 'fun' exercise.
I'll be copying your post to hand out at my next meeting on gun safety.
Buy used, then, at a reputable gun shop. Just not a new S&W.
It's a 9MM ~ I don't like wheel guns and only own autoloaders ~ the CS9 fits my hand perfectly and it's a pleasure to shoot.
I've owned several accurized Colt 1911 45's over the years, but got rid of them all. I now have this S&W, a couple Browning Hi-Powers, some Walther PP's, PPK's, PPKS's and Beretta autoloaders in various calibers, from .22 to 9mm.
It looks like the majority of gun owning Americans know that a strong gun industry is better than a weak but politically friendly industry. I was at a gun show yesterday. Bought a Sig P245 but I am looking at a Smith & Wesson CS45 semi-auto. Or perhaps a one of those new 45's done in conjunction with Walther. I forget the model. Quality is quality.
No. The British company which owned Smith and Wesson lost their shirts on the deal. It's now owned by an American Company called Safe-T-Hammer. Since the agreement is legally binding, both sides have to agree to get out of the contract. Until we get more conservatives in the legislature, the company is stuck with it.
Some Kimber parts are made by [guess who?] Smith and Wesson. Enjoy yourself by boycotting Kimber.
I saw this and thought of you and SirAllen. I don't think your plan for killing Smith and Wesson is working too well.
Kimber says not anymore.
Link to Kimber statement --- www.kimberamerica.com
"Does Smith & Wesson make any parts on the Kimber?
" No. Kimber pistols and rifles are 100% manufactured, assembled and tested by Kimber.
" ** At one time, Smith & Wesson provided raw metal forgings to Kimber. These blocks of steel were then machined by Kimber into slides and frames. This is no longer true and Kimber does every aspect of the pistol & rifle production. "
Thanks for the information. I did know when the boycott was in full swing, Kimber was having their forgings made by Smith. It was always fun to hear someone yelling about Smith and Wesson and they would show me their brand new Kimber.
Or an SKS made with slave labor by Communist China.
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