Gun Control & RKBA
Related: About this forumIconic gunmaker Colt is on the brink of bankruptcy
http://money.cnn.com/2015/06/10/news/companies/colt-bankruptcy/index.htmlThe company, that has been making guns for 160 years, has been struggling financially and missed a $10.9 million interest payment on its debt in mid-May.
Colt admitted, in a regulatory filing, that its failure to make that interest payment raises "substantial doubt about the company's ability to continue as a going concern." Colt also said it "may seek relief under the bankruptcy code."
The company has a 30-day grace period until June 14 to make the interest payment after which it has to find a way to restructure the debt with its bondholders.
Kevin Starke, gun industry analyst for CRT, said that Colt had already signed a debt restructuring agreement with its bank, but a group of bondholders rejected it that would have dropped the bonds to 45% of their face value.
Cooley Hurd
(26,877 posts)Duckhunter935
(16,974 posts)just like Indian motorcycles, too much legacy to let it go.
davepc
(3,936 posts)Somebody will buy them for the name and the M4/M16 contract alone.
Lurks Often
(5,455 posts)I think FN is making them in South Carolina
Lurks Often
(5,455 posts)Whoever buys Colt won't stay in CT and they'll need to start coming up with some new designs as well, since other companies are selling the same current designs of equal quality at a lower price.
benEzra
(12,148 posts)when they let their line of civilian revolvers and pistols wither while wasting resources on politically favored but unreliable "smart guns", mostly abandoning the civilian AR market to other companies just as the AR became the top selling civilian rifle in the United States, and setting themselves up for gun-owner boycotts once or twice in the '90s. The disaster with the promising All-American 2000 9mm pistol (interesting design, lousy quality assurance) hurt them badly and sent them into Chapter 11 for a while. And when they finally re-entered the AR market, their quality was excellent (a Colt 6920 is still of the more highly regarded AR's) but they lagged in adapting to civilian innovation on that platform; to this day, you can't buy a Colt AR with a midlength gas system, for example.
What is really hurting them right now is debt from their prior poor decisions, though; their revenues are decent, but given their debt load they would have to have stellar revenues to survive.
I do think they will emerge from bankruptcy a much healthier company; we'll see.
Good writeup at Wikipedia: https://en.wikipedia.org/wiki/Colt%27s_Manufacturing_Company
ileus
(15,396 posts)Hopefully if Colt is bought an American company will do it. Ruger where are you???
DonP
(6,185 posts)Their business strategy, of focusing on a few large customers and very limited high priced offerings to a broader customer base with little dealer support is a bad premise.
All it takes is one major customer to go elsewhere and they're in trouble.
Now they'll scramble to try and rebuild their civilian customer base by re-issuing older designs and repeat the whole cycle again.
Maybe the next owners will spend some money on R&D and a decent "go to market" strategy and stop trying to milk the brand to death.
Duckhunter935
(16,974 posts)decision process for two of my weapons
Colt 1911 government model
Colt LE6920
DonP
(6,185 posts)But some investment in new technology and new designs is what builds their stability and a future market.
Everybody loved the 55 to 57 Ford T-Birds. But somebody at Ford was smart enough to design the Mustang for the next few generations.
Colt hasn't been doing that.
Duckhunter935
(16,974 posts)Eleanors38
(18,318 posts)as a means of recovering. At the end of the 1990s, they were facing bankruptcy. But they went about improving a good, cheap rifle they had been making for years, and expanded their offerings, all well made. The company is doing well today.