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And don't kid yourself. Governments pay WAY WAY WAY WAY less than American consumers.
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True, but governments buy way, way, way more of them.
I'm not sure if I buy the Kvar "finding" the "discontinued" guns or parts in it's warehouse story that keeps going around. Pretending to be out of rifle, then finding 10 of them a year later and selling them for $100 more than the previous price is a lot of effort for an additional $2000 in profit. It's possible but not a good marketing practice.
They come in cycles most likely because the factory builds them in cycles. It's a lot of effort to change tooling/presses from one item to another that most large batch manufacturing facilities make items in large batches. It's unlikely they are tooled up to manufacture all calibers/types of rifles all at once.
The last time the SLR104FR was in stock, it sold for the same price that it sold for 4 years ago when they first came out. No price increase in 4 years. And the SLR107FR cost about $700 when they first came out 10 or so years ago. The last time they were in stock, Kvar sold them for $999. That's really not much of an increase over 10 years. Compare that price increase to cars, food or houses.