Another Gun Maker Says Farewell to Tough Restrictions
Yet another gun manufacturer is voting with its feet, and leaving a state because of its overreach on regulation. Instead of opening a new facility in Orange County, N.Y. with 80 to 100 new jobs, Kahr Firearms Group will instead relocate over the Delaware River into Pike County, Penn.
Earlier this year, a number of Connecticut gun makers announced their intention to pick up and move their facilities out of state when politicians there enacted some of the strictest gun laws in the country. PTR Industries announced it was leaving for the more welcoming climes of Myrtle Beach, S.C., as did Stag Arms, which is deciding between South Carolina and Texas.
It's a movement still gaining steam, with manufacturers leaving oppressive states for those offering more freedom. Texas, in particular, has been vocal about welcoming gun makers, and is one of the locations Magpul Industries is considering as it plans to vacate Colorado.
New York's new anti-gun law expands a ban on military-style weapons, requires mental-health professionals to report perceived threats, limits magazines to seven bullets, taxes bullets, and creates a gun registry. New Jersey's Gov. Christie also just signed a group of new gun laws, though the more controversial (and restrictive) ones are still on his desk.
Kahr said it could have stayed in New York and built a new plant, but, "We're looking for a more friendly environment for our business."
Not every firearms manufacturer is pulling up stakes, however, preferring to be more wishy-washy about their feelings. Beretta thought about leaving Maryland, but instead, said that if it created any new jobs, they would be made out of state. Remington Arms, part of Freedom Group, the amalgamation of gun companies that Cerberus Capital Managment dumped after the Sandy Hook shootings, posted on its Facebook page that it still needs to mull over whether it wants to move. While some suspected a quid pro quo after it received an $80 million Defense Dept. contract within days of meeting with a group of state politicians, Remington said the deal was years in the making, and has nothing to do with its decision to stay or go.
Similarly, Sturm, Ruger and Colt Defense have not indicated any intention of leaving Connecticut, while Smith & Wesson Holdings seems content to remain nestled in Massachusetts, despite its restrictive gun laws.
Undoubtedly, the decision to leave a state is not so simple as packing up a few boxes and some furniture. And while some gun makers may disagree with the proliferation of gun-control laws, they're actually doing brisk business because of them. Smith & Wesson reported record sales last quarter as revenues surged 42%, and profits quadrupled from the year-ago period. Ruger's profits nearly doubled, and ammo maker ATK would have had even better results after reporting strong demand in sporting groups demand, but a decline in defense sales led to relatively flat revenues.
While the big name gun slingers have yet to protest the attack on their livelihood, the industry still has a target on its back. But the constant drip from smaller firearm makers does add up until it becomes a torrent that can't be held back when the dyke finally bursts open.
The article Another Gun Maker Says Farewell to Tough Restrictions originally appeared on Fool.com.Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool owns shares of Sturm, Ruger & Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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