View Full Version : Colt in Trouble
Looks like Colt is in financial trouble, after 160+years will this be the end of a era or will they become another name in a portfolio like many of the other industry giants have.
http://www.colt.com/ColtintheMedia/PressReleases/tabid/252/articleType/ArticleView/articleId/131/Colt-Defense-Enters-Support-Agreement-with-Secured-Lenders-Extends-Exchange-Offer-Consent-Solicitation-and-Prepackaged-Solicitation-with-Amended-Terms.aspx
Heh, I posted this last year, the year before, the year before.
Colts in trouble every year but they get bailed out at the last minute.
This year maybe I will bail em out.
Bailey Guns
06-09-2015, 19:14
They narrowly averted a bankruptcy in Nov 14. This is sad news. But it's a new world and competition is tough. A company always needs to be on it's "A" game to stay around...even Colt.
BPTactical
06-09-2015, 19:29
Anxiously awaiting Obammy to bail them out ala GM............
Colts are fine guns, they just seem to appeal to an older crowd. Most of this may be caused by the price being higher than most others. And the fact that the plastic mainspring housing cracked on my Delta is a bit of crap. They need to make something as refined as the Ruger 1911, at about the same price. Or I'd by a Peacemaker if the were under a grand.
Richard K
06-09-2015, 21:37
Anxiously awaiting Obammy to bail them out ala GM............
Obammy bailing out a gun manufacturer. Color me surprised if he does. Glad I got my XSE Commanders in 9 mm and .45 before the bottom falls out. Warranty repair? Not counting on it.
If Colt has financial troubles in this market, they're clearly doing something very wrong. Economic darwinism.
Bailey Guns
06-09-2015, 22:09
I love Colt guns. Wish I had more.
kidicarus13
06-09-2015, 22:32
They narrowly averted a bankruptcy in Nov 14.
Colts are fine guns, they just seem to appeal to an older crowd.
The WWI, WW2, and Vietnam crowd. Fine guns but a little overpriced due to sentimental reasons IMHO... especially their 1911's
They just kept their stuff too high priced for too long. When even a RIA is shooting relatively well, it is hard to justify more money for a colt for the average joe.
Why own Colt when you can own Glock?
Bailey Guns
06-10-2015, 05:03
Why own Colt when you can own Glock?
Why say stupid things on the internet?
Does Glock make an AR-15? Did Glock make 1911 pistols in WWI and WWII? Does Glock make single action revolvers? Can I own a Glock and a Colt?
Colt's prices have more to do with their labor force than sentimental reasons. And with their new stocking dealer program the prices (at wholesale, anyway) are significantly lower than they have been.
Can I own a Glock and a Colt?
Yes, for the record.
Either that or I didn't get the memo. :)
O2
hurley842002
06-10-2015, 06:50
They just kept their stuff too high priced for too long. When even a RIA is shooting relatively well, it is hard to justify more money for a colt for the average joe.
I agree with this. Most average Joe's I come across, just want a 1911 to have a 1911, not because of the name on the side.
Zombie Steve
06-10-2015, 07:18
Someone will always buy that name, at least for the model P / SAA.
There is no better way to boost sales than to create a shortage by announcing a going out of business sale. This should get them over the hump for the short run. They have good products if they would just price them competitively and stop looking for government handouts (contracts).
jhood001
06-10-2015, 09:19
I love Colt, but I think they need some new designs.
Colts are fine guns, they just seem to appeal to an older crowd. Most of this may be caused by the price being higher than most others. And the fact that the plastic mainspring housing cracked on my Delta is a bit of crap. They need to make something as refined as the Ruger 1911, at about the same price. Or I'd by a Peacemaker if the were under a grand.
I am certain that is the first time I have seen "refined" and "Ruger" used in the same sentence.
That said, I can't find fault with their SR1911 - other than using a cast (vs forged) frame and barstock (vs forged) slide. Nice gun.
And with their new stocking dealer program the prices (at wholesale, anyway) are significantly lower than they have been.
While this is true, it seems crazy that they're picking this point, while they're on the edge of bankrupcy, to start restricting which dealers can sell their product. To say you have to buy a minimum of 10 guns they've selected, or you can't buy any, when Colts just aren't selling as well as other products is baffling to me. I might sell a 1911 or an AR here and there, but what am I going to do with mandatory Colt Mustangs?
Maybe they're trying to sell the idea that Colt is "special"?? I guess it briefly worked for M855... :)
funkymonkey1111
06-10-2015, 11:24
Never understood why they stopped making the DA revolvers (Python, King Cobra, Anaconda). Those sure were nice.
Never understood why they stopped making the DA revolvers (Python, King Cobra, Anaconda). Those sure were nice.
Yep, this.
Interesting article about the history of Colt's lack of leadership:
http://www.bloomberg.com/bw/articles/2014-05-29/colts-curse-gunmakers-owners-have-led-it-to-crisis-after-crisis#p1
Maybe if it was run by someone more in tune with guns rather than Wall Street, they could turn the company around.
kidicarus13
06-10-2015, 12:49
IBTL
airborneranger
06-10-2015, 12:52
Not sure what that post has to do with COLT.
And.....a troll.
As kid said IBTL.
Sent from my VS880 using Tapatalk
Bailey Guns
06-10-2015, 12:59
Time to block an IP.
funkymonkey1111
06-10-2015, 13:02
Not sure what that post has to do with COLT.
I thought Bush ran Colt into the ground
Not sure what that post has to do with COLT.
No shit...... This thread was to inform fellow members of the troubles a cornerstone in the firearms industry currently facing. Not a thread for a political rank and a place to rip on members. FJO
While this is true, it seems crazy that they're picking this point, while they're on the edge of bankrupcy, to start restricting which dealers can sell their product. To say you have to buy a minimum of 10 guns they've selected, or you can't buy any, when Colts just aren't selling as well as other products is baffling to me. I might sell a 1911 or an AR here and there, but what am I going to do with mandatory Colt Mustangs?
Maybe they're trying to sell the idea that Colt is "special"?? I guess it briefly worked for M855... :)
Less paperwork and overhead for them when multiple guns are ordered at a time vs 10 separate orders at 1 gun a piece.. Big orders look good on the books when you have outsiders looking in over your shoulder.
I see this all the time in my industry.. Companies go with independent rep firms then at some point get the idea to save money and sell in house while weeding out the fly by night and small order dealers then when that fails they go back to independent reps and so on over and over... All the big consumer electronics firms constantly go through this.
Bailey Guns
06-10-2015, 14:05
^^ That may be true but it won't apply to Colt. They'll be selling guns in bulk to distributors. I don't think they fill individual dealer orders except for Custom Shop type special stuff.
Even Kimber, which is dealer direct, requires a hefty buy-in in order for a dealer to qualify as a Master Dealer. Then they require minimum orders after that...or they did, anyway. The upside is dealers get the best pricing that way. A mom and pop shop that's a Master Dealer gets the same pricing as a huge retailer.
This just in: Poorly run business appears to be going out of business. Film at 11:00.
anyone know what ever happened with the rumor Colt was buying LWRC for 60 million ?
anyone know what ever happened with the rumor Colt was buying LWRC for 60 million ?
Colt probably realized they don't have 60 million dollars to spare right around the time they filed chapter 11.
Circuits
06-11-2015, 00:31
Colt has been sold and resold multiple times since the 1970s. Only if the new masters impose their ideology upon their servants will the change ever be noticed.
Sometimes change is for the better. More often, change is for change's sake and ends up being for the bad.
Amen to Laissez-faire and the free market!!!!
This mornings news showed a crawler that said Colt filed for chapter 11 today.
We knew it was headed that way.
BladesNBarrels
06-15-2015, 09:24
Maybe Colt will follow Winchester's example and sell the name to FN, Browning, contract with Miroku in Japan, and create other items with the Chinese.
[Train]
This mornings news showed a crawler that said Colt filed for chapter 11 today.
We knew it was headed that way.
If/when they close down I'm sure any Colt will see a spike in value.
This gives a bit more info from a purely economic viewpoint. Yes, this is Bloomburg (but the trading platform) and yes I am aware that might as well be synonymous with Satan around here but he does not have anything to do with the writing when it comes to this level. I have no reason to not belive this is true. For those of you going for laissez-faire economics (which by the way is French)........ so since these guys bought Colt and basically sucked it dry........ You would be good if a Billionaire like Bloomburg simply went out, bought all of the major gun manufactures (and probably ammo resources like Hodgdon) through dummy corporations and then one day just shut them all down? Guess that means he will win eventually. To be clear: I am not saying to-big/old-to-fail but this seems like an easy and cheap way for that assclown to win.
The gun company founded by Samuel Colt has flirted with financial disaster for much of its 179-year history. Now the storied West Hartford (Conn.) maker of rifles and pistols is heading into Chapter 11, in large part because of more than a decade of dubious financial engineering and accumulating debt.
Colt Defense, as the main part of the company is now known, filed for bankruptcy protection on Sunday while listing as much as $500 million in debt. Cooling demand for its civilian semiautomatic rifles and handguns, as well as delays in certain large U.S. government and foreign military orders, have exacerbated the company's finances. But the main reason the company hasn't weathered rocky market conditions since the winding down of the wars in Iraq and Afghanistan is that the New York financiers who control the company borrowed too much and paid themselves lavishly.
As I reported in a feature story last year (http://www.bloomberg.com/bw/articles/2014-05-29/colts-curse-gunmakers-owners-have-led-it-to-crisis-after-crisis#p1), the private equity firm Sciens Capital and its affiliates loaded Colt with debt since the mid-2000s while taking cash out in the form of "distributions" and "advisory fees." Sciens remains the controlling owner of Colt Defense, according to a regulatory filing (http://www.wsj.com/articles/colt-defense-to-file-for-chapter-11-bankruptcy-protection-by-monday-1434310925). An executive with Sciens did not immediately return a message seeking comment.
In 2009 and 2010, meanwhile, Colt somehow missed out on the "Obama surge," a run of strong civilian gun sales prompted by fears whipped up by the National Rifle Association that the Democratic president would stiffen federal gun control. The panic-based buying that lifted the small arms industry has now eased, making it even more difficult for Colt to move the military-style semiautomatic rifles it had hoped would be its salvation. "The industry's recent rapid growth is expected to slow over the next five years, increasing at a more modest average annual rate of 4.1 percent," according to the research firm Ibisworld.
Here's how Bloomberg News is reporting (http://www.bloomberg.com/news/articles/2015-06-15/colt-defense-179-year-old-gunmaker-files-for-bankruptcy) on the bankruptcy protection filing:
Colt’s current sponsor Sciens Capital Management LLC has agreed to act as a stalking horse bidder for all of its assets and liabilities related to existing agreements, according to a statement from the gunmaker. Existing secured lenders have agreed, subject to court approval, to provide a $20 million debtor-in-possession credit facility, Colt said. The current management team will remain in place.
“Colt remains open for business,” Chief Restructuring Officer Keith Maib said in the statement.
Open for business, perhaps, but vulnerable now to being sold off in pieces with little remaining behind the brand associated with such iconic firearms as the 1873 Single Action Army, known as "the gun that won the West," and the Colt 1911, the official sidearm of U.S. Army soldiers from WWI through Vietnam.
Great-Kazoo
06-15-2015, 17:50
This gives a bit more info from a purely economic viewpoint. Yes, this is Bloomburg (but the trading platform) and yes I am aware that might as well be synonymous with Satan around here but he does not have anythin to do with the writing when it comes to this level. I have no reason to not belive this is true. For those of you going for laissez-faire economics (which by the way is French)........ so since these guys bought Colt and basically sucked it dry........ You would be good if a Billionaire like Bloomburg simply went out, bought all of the major gun manufactures (and probably ammo resources like Hodgdon) through dummy corporations and then one day just shut them all down? Guess that means he will win eventually.
I mentioned this a few years back when Cerebus was buying gun companies . Not far fetched at all
Quit agreeing with me...... It might give others ideas. ;)
[Sarcasm2]
I mentioned this a few years back when Cerebus was buying gun companies . Not far fetched at all
The only thing surprising about this is just how long it took to finally send the once-pround pony to the glue factory.
Great-Kazoo
06-15-2015, 23:28
Quit agreeing with me...... It might give others ideas. ;)
[Sarcasm2]
Agree or not. I've said it before to much dismissing of it as fact. Yet when asked to prove me wrong, the silence was deafening.
Now why won't FedGov bail Colt out like they did GM, Chrysler and many, many banks?
Doncha just love when FedGov decides winners and loser for ya, kinda like the billions of taxpayer dollars lost when a bunch of solar (fraud) companies went under after FedGov funded their ridiculous plans.
Ya.... Seriously... What do you figure are the odds of opening up another lead factory. If the powder shops were to be closed (its not like there are a lot of them), how long (if ever) would it take to open up a new one? There are several companies that could/would cause serious disruption if not irreparable damage to the gun industry. We are not talking about capitalism here. We are talking about targeted disruption to the gun industry. Capitalism assumes that somebody is making money.... Getting ahead, even if by killing off a competitor. Here we are fighting an ideology that wants to remove an industry for no other reason than they believe it is evil. Between these types of attacks, laws like our glorious 2013 Colorado laws and executive orders/policy that can directly affect core rules such as those from the ATF(M855)...... Would it stop all guns/ammo, not by itself. Make laws and executive orders restricting/onerous enough for new manufacturing business, buy up the old business(s) and shut them down/run'em into the ground... There is a vulnerability here that could hurt us. If MagPul had not been allowed to move for some reason and had to shut down, do you really think they got that big overnight? If 'they' squash'em young its much easier than a long standing business that has already proven itself. I once met Rhonda Rodes.... Her first question was how do we get rid of the ammo so they have nothing left? My jaw dropped and I said "You can't!" But on watching them...... That is exactly what they want to do. Go after the manufacturers, the business. It is after all just the business of death to them. Looking at Colt, I just wonder if that is not the long game plan. Their actions don't make sense to me otherwise.
BTW: They did not just buy Colt and shut it down....... They ran it into the ground. Shutting it down would have created a vacuum for, as you state, somebody else to fill. No, they maintained Colt and ruined everything about it, reputation, assets, knowledge, etc. As pointed out in other posts... Run'em into the ground so the name can be sold to China and we get cheap knockoff's with an old name. Ya.... No damage to guns from that.
Lol I wouldn't have much of an issue with a billionaire buying out the corporations. Doesn't shut mfg down provides billions in the pockets of gun mfgs who can - gasp - open a new company with that money. Opens up new competitive options. Where there is demand, there are companies to fill it. If you're stupid enough to sell to Bloomberg, the other companies that don't will reap the rewards. Out of all of the possibilities of attack money, that would hurt us the least, it would be like a lion culling the sick members of our herd.
osok-308
06-16-2015, 23:00
Hopefully if Colt does go down, it's after I get my hands on one of their rifles. [Beer] It would be sad to see them go. If they don't maybe they'll learn something from past mistakes?
http://www.guns.com/2015/06/26/colt-secures-20m-loan-amid-bankruptcy-pushback-by-creditors/ (http://www.guns.com/2015/06/26/colt-secures-20m-loan-amid-bankruptcy-pushback-by-creditors/)
Same as the last 5 x's they were in trouble.
Great-Kazoo
06-26-2015, 20:36
That pretty much sums it up. The idea here is purely to pull as much cash out of the name until it goes under. Then settle the bankruptcy killing off the colt name, and resurrecting another in its place and repeat. I feel bad for the workers and smiths that have invested a career into the company just to watch upper level management drive it into the ground milking all the cash out of the business.
If they really wanted the Colt name to survive, they would have invested in R&D and put out a competitive affordable polymer pistol and a bunch of distinguishable AR furniture. People would have gone nuts over a colt competitor to the Glock/XD/Smith race. It is what HK did, and while they are not screaming back to life, they are doing a whole lot better than Colt is.
They did offer a polymer pistol .............................The Colt 2000. rotating bbl, along the lines of a Steyr . Unfortunately Colt failed to listen to the designers (E. Stoner) to name one of them. Colt being Colt went to a 12lb trigger (IIRC) vs the 5 or 6 lb as originally designed / suggested.
KestrelBike
06-26-2015, 22:34
Colt being Colt went to a 12lb trigger (IIRC) vs the 5 or 6 lb as originally designed / suggested.
Did they do that for the children?
Grant H.
06-26-2015, 23:20
This won't be a popular opinion here, but I say let 'em sink, and throw them a concrete block to help.
Do I want to see large arms manufacturer die from a guns right perspective? No, not really. But Colt just isn't cutting it anymore.
They haven't provided anything competitive in a LONG time, and they priced themselves out of the game. There isn't anything about a Colt AR-15 that makes it better than 99% of the other manufacturers out there. However, the name still brings a price tag because of some illusion that a former .gov contracting manufacturer must produce better gear. Total BS, in fact, it's usually the opposite. The prototypes to win the bid might be perfect, but mass produced horse sh!t isn't.
When I personally ordered 4 Colt AR-15's, and 3 of them showed up with catastrophic issues (front sight canted to the point of no gas flow, barrel nut would allow 1/4" slide of barrel forward and back, and BCG wouldn't even completely rotate and lock) I sent them all back and demanded my money back.
That kind of sh!t is why they are so far in the hole that they can't survive. The fact that they have been bought and strung along so many times is just sad.
KestrelBike
06-27-2015, 07:08
This won't be a popular opinion here, but I say let 'em sink, and throw them a concrete block to help.
Do I want to see large arms manufacturer die from a guns right perspective? No, not really. But Colt just isn't cutting it anymore.
They haven't provided anything competitive in a LONG time, and they priced themselves out of the game. There isn't anything about a Colt AR-15 that makes it better than 99% of the other manufacturers out there. However, the name still brings a price tag because of some illusion that a former .gov contracting manufacturer must produce better gear. Total BS, in fact, it's usually the opposite. The prototypes to win the bid might be perfect, but mass produced horse sh!t isn't.
When I personally ordered 4 Colt AR-15's, and 3 of them showed up with catastrophic issues (front sight canted to the point of no gas flow, barrel nut would allow 1/4" slide of barrel forward and back, and BCG wouldn't even completely rotate and lock) I sent them all back and demanded my money back.
That kind of sh!t is why they are so far in the hole that they can't survive. The fact that they have been bought and strung along so many times is just sad.
Sounds just like the US auto industry a decade ago.
Sounds just like the US auto industry a decade ago.
I agree with him & said the same shit about the auto industry years ago. Let them sink. They get too fat & fail but that's when the new kid on the block with a better idea gets his chance. Failure breeds innovation. Success breeds comfort. When Colt fails we'll be better off as a consumer. Companies who produce inferior products at higher prices while stifling the little guy w/the better idea is bad for the industry. No more bailouts. If they're too big to fail than our regulations in place to prevent such things are failing us. If they fail... let 'em. No more socializing loss while privatizing profits. Bovine excrement.
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