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Posted: 1/27/2009 4:30:00 AM EST
...when demand is so high right now?

Linky
Link Posted: 1/27/2009 4:32:34 AM EST
That's a good question.

Link Posted: 1/27/2009 4:36:22 AM EST
I have a feeling that they have not caught up with demand.
Link Posted: 1/27/2009 4:37:15 AM EST
Only certain types of ammo are in high demand right now.  I bet ammo demand for exotic hunting or similar activities is down now as the economy tightens up.  The machinery is most likely not able to be converted to stuff that is in more demand.  

Link Posted: 1/27/2009 4:38:25 AM EST
It could be due to installing more machinery and automation.
Link Posted: 1/27/2009 4:39:16 AM EST
The company hired 150 workers in Anoka about a year ago to clear a backlog of orders for pistol and small rifle ammunition. Alliant Techsystems spokeswoman Amanda Covington said the company has cleared the backlog, and with hunting seasons ending, Alliant is facing reduced demand.


Huh?  There must be about 100 billion rounds in transit, then.  Or distributors are artificially restricting supply to retailers to keep the prices jacked up.  There's probably an ammo warehouse somewhere that looks like the one at the end of Raiders of the Lost Ark.
Link Posted: 1/27/2009 4:39:25 AM EST
I think many if not most companies will be doing this to try and reduce their spending. What happens if they get caught up and have no or less work for all those employees?



In my current situation I still have a job but the guy that worked with me is gone. Now they are paying nearly 1/2 as much and still getting all the work done. Those with jobs will be expected to do more with less. BHO has companies scared and reducing their spending.
Link Posted: 1/27/2009 4:39:52 AM EST
It's probably due to the fact that demand is high only on certain calibers.

While .233/5.56, .308, .40 S&W, .45, .9mm are in demand others are not and are probably off in sales.

Look at the ammo shelves when you go to the store. The above are hard to find but shelves are full of everything else.

Let me preface the next statement with I only shop at Wal-Mart for ammo. The other day I found a pack of 100 .223 Remi and purchased. Went back to get another and they were all gone. None of the above calibers I mentioned but a lot of other stuff such as .357 mag, .380, and every rifle caliber you can think of except .223/5.56 or .308.

Thats my $.02. I'm sure Federal knows whats selling and that is what the are concentrating on making.
Link Posted: 1/27/2009 4:42:41 AM EST
Excellent way to pad the company accounts. Cut expenses and production and keep prices high while enjoying lower metal costs. Not an uncommon thing to do when the economy sucks and you have limited competition.
Link Posted: 1/27/2009 4:45:21 AM EST
They were just temps. The hired 150 a year ago, now they are dropping 80. Probably not the brain trust of the company.
Link Posted: 1/27/2009 4:56:07 AM EST
From the article:

"Federal Cartridge makes police and hunting ammunition sold through Wal-Mart, sporting goods stores and to dozens of police departments around the country. "


I'm sure you recall Walmart closing up firearms and ammunition sale in MANY stores.
I suspect that is a contributing factor in these layoffs.
Link Posted: 1/27/2009 4:59:32 AM EST
Quoted:
Excellent way to pad the company accounts. Cut expenses and production and keep prices high while enjoying lower metal costs. Not an uncommon thing to do when the economy sucks and you have limited competition.


/thread
Link Posted: 1/27/2009 4:59:58 AM EST
So, the price on military caliber ammunition (much of which is also used for hunting) has damn near doubled in the past 2 years and most online vendors are out.  How has demand dramatically dropped?

I know I'm preaching to the choir here, but WTF?

Something's fishy here...  
Link Posted: 1/27/2009 5:03:46 AM EST
Quoted:
They were just temps. The hired 150 a year ago, now they are dropping 80. Probably not the brain trust of the company.


this

they most likely hired on a bunch of folks to meet orders, now as they don't need them they are laying them off...

no different than best buy or target hiring extra help for the holiday season
Link Posted: 1/27/2009 5:15:57 AM EST
Quoted:
The company hired 150 workers in Anoka about a year ago to clear a backlog of orders for pistol and small rifle ammunition. Alliant Techsystems spokeswoman Amanda Covington said the company has cleared the backlog, and with hunting seasons ending, Alliant is facing reduced demand.


Huh?  There must be about 100 billion rounds in transit, then.  Or distributors are artificially restricting supply to retailers to keep the prices jacked up.  There's probably an ammo warehouse somewhere that looks like the one at the end of Raiders of the Lost Ark.


How about the distributors are shipping as quickly as possible to the outlets?  How many times on here have you seen a post saying, "XXXXX has 100,000 rounds of 5.56 in!!!! OMG11111######!"

Then, 30 minutes later, "All sold out!?"

I'm sure there are those here who could supply the ammo requirements for a small country for at least a year.  But every time one of the vendors gets some stock in, they buy another 5,000 rounds, just in case.  

I have a healthy supply myself, but I haven't bought any in a while because:

 a.  I really don't need any right now.

 b.  I refuse to pay what most of it is going for.

 c.  I determined that I can only carry so much.  


Cut demand, and the prices will fall.  But buying out every supplier when they get a shipment does nothing but keep the demand high.
Link Posted: 1/27/2009 5:18:22 AM EST
Quoted:
It's probably due to the fact that demand is high only on certain calibers.

While .233/5.56, .308, .40 S&W, .45, .9mm are in demand others are not and are probably off in sales.

Look at the ammo shelves when you go to the store. The above are hard to find but shelves are full of everything else.

Let me preface the next statement with I only shop at Wal-Mart for ammo. The other day I found a pack of 100 .223 Remi and purchased. Went back to get another and they were all gone. None of the above calibers I mentioned but a lot of other stuff such as .357 mag, .380, and every rifle caliber you can think of except .223/5.56 or .308.

Thats my $.02. I'm sure Federal knows whats selling and that is what the are concentrating on making.


And .22lr. Have you tried to find .22lr at Wally lately?

Good luck with that shit.
Link Posted: 1/27/2009 5:19:57 AM EST
Quoted:
...when demand is so high right now?

Linky


This whole article if full of fail. Behold another well run American company. Why not retool for some exotic caliber like 7.62x39 and rake the cash in with those laid off employees.
Link Posted: 1/27/2009 5:42:46 AM EST
There was a minimal profit on each round of ammo... When prices spiked because of energy/metal prices/demand the ammo companies saw that people would still buy the ammo at the increased prices, so they have not reduced their prices.



Link Posted: 1/27/2009 5:58:53 AM EST
They are probably doing what other companies are doing, trying to increase their profits. And why not? Companies are in business to make money, and not be "altruistic." If you can make something that costs you $1, and sell it for $100, more power to you.
Link Posted: 1/27/2009 6:04:26 AM EST
The company hired 150 workers in Anoka about a year ago to clear a backlog of orders for pistol and small rifle ammunition. Alliant Techsystems spokeswoman Amanda Covington said the company has cleared the backlog, and with hunting seasons ending, Alliant is facing reduced demand.



Go figure
Link Posted: 1/27/2009 6:35:57 AM EST
Quoted:
They are probably doing what other companies are doing, trying to increase their profits. And why not? Companies are in business to make money, and not be "altruistic." If you can make something that costs you $1, and sell it for $100, more power to you.

It's hard for me to believe that their board of directors meetings go like this.  

"Let's specialize in manufacturing calibers that aren't generally used much by the shooting/hunting community.  While we know that the more common cartridges are in short supply and commanding record prices that's just too much pressure.  We just can't afford to manufacture high demand calibers and demand premium prices, nor can we afford to have our brand name perceived as ubiquitous or a household name in ammunition."

Yeah, weirder things have happened I'm sure.  It just doesn't sound like an effective business model to me.  


ETA:  I was going to comment on the article in that paper but was having difficulty getting a login name.  After finally having some success - they've still not YET sent me a verification e-mail so I can post.  Sad.
Link Posted: 1/27/2009 6:38:41 AM EST
Bracing themselves for ammo serialization
Link Posted: 1/27/2009 6:41:54 AM EST
Just like gas prices.  Raise them, and people continune to buy, so why lower them, even if you have caught up to demand?  

I'm guessing that some sort of balance has been reached between supply and demand, prices are still high because people are still panic buying.  The good news is, ammo really isn't a necessity like gasoline is.  If everyone would STFU and quit buying truckloads of 5.56 at $600 a case, it would start to come down.

Link Posted: 1/27/2009 7:09:32 AM EST
Quoted:
Bracing themselves for ammo serialization


Or military ammo bans or excessive taxation or an AWB.
Link Posted: 1/27/2009 7:15:35 AM EST
They are looking at future demand in a week economy.  We are but a tiny segment of the buying public.  

It is probably hard to remember from our pre-gun nut days, but normal people do not buy cases of ammo in the face of looming economic uncertainty.

Also, Federal has a near monopoly.  They have artificially restricted supply for quite some time now.  We have rewarded them by increasing prices from $250 to $400/1000.

Consumers need to start exercising a little self control and financial discipline.
Link Posted: 1/27/2009 7:18:08 AM EST
Quoted:
They were just temps. The hired 150 a year ago, now they are dropping 80. Probably not the brain trust of the company.


One other guy read the article.

Link Posted: 1/27/2009 7:21:12 AM EST
Quoted:
Just like gas prices.  Raise them, and people continune to buy, so why lower them, even if you have caught up to demand?  

I'm guessing that some sort of balance has been reached between supply and demand, prices are still high because people are still panic buying.  The good news is, ammo really isn't a necessity like gasoline is.  If everyone would STFU and quit buying truckloads of 5.56 at $600 a case, it would start to come down.



Exactly.
Link Posted: 1/27/2009 7:25:58 AM EST
Slugs and birdshot maybe?

Hard to convert those lines to metallic.
Link Posted: 1/27/2009 7:27:06 AM EST
Federal makes a lot of ammo that isn't in demand right now, and I'd bet that it's the guys making 257 Roberts and 300 Savage ammo that are getting laid off.  As others have said, it's probably not cost effective to retool for 223 production.

The 22LR factory is probably hiring.

The 223/308, 9mm, 45ACP, 40S&W factories are also probably hiring.

I doubt they're cutting production of high demand products.  They're in business, and they'll what they can to maximize profits.

This is as it should be.
Link Posted: 1/27/2009 8:07:53 AM EST
It really doesn’t say what kind of ammunition that those particular workers were manufacturing (they hint at hunting ammo). They could have been hired as temps, many companies are resorting to temporary employees when required.  Sometimes government contracts have a clause written in to them that levies a fine or penalty if the contract is not completed by an agreed upon date, or pays a bonus if the job is completed early. Maybe they finished a government contract and no longer need the extra work force. As for cranking out ammunition for civilian sales, why flood the market with product and drive down the price. If they keep the availability moderated, they can keep the price at higher levels. They know that people will continue to buy at the current  inflated prices.

Arcane6-1
Link Posted: 1/27/2009 12:05:15 PM EST
Quoted:
From the article:

"Federal Cartridge makes police and hunting ammunition sold through Wal-Mart, sporting goods stores and to dozens of police departments around the country. "


I'm sure you recall Walmart closing up firearms and ammunition sale in MANY stores.
I suspect that is a contributing factor in these layoffs.


If that's true how come my Wal Mart only has .380, .22, and birdshot on the shelf.

Link Posted: 1/27/2009 12:11:21 PM EST
If their backlog of demand is cleared, then all the dealer orders are covered –– and that should mean a LARGE AMOUNT of ammo is in the supply chain heading toward store shelves.  That would be nice.
Link Posted: 1/27/2009 12:19:33 PM EST

Just have to let you know, I bought 119 rounds of 7.62x39 for just $20 Today from a fella at work.
Link Posted: 1/27/2009 12:29:32 PM EST
The laid-off guys should join up and start up their own ammo manufacturing company.
Link Posted: 1/27/2009 12:31:48 PM EST
The local Wally World near me has quite a bit of .22..........I am gonna get  a few bricks this weekend


Quoted:
Quoted:
It's probably due to the fact that demand is high only on certain calibers.

While .233/5.56, .308, .40 S&W, .45, .9mm are in demand others are not and are probably off in sales.

Look at the ammo shelves when you go to the store. The above are hard to find but shelves are full of everything else.

Let me preface the next statement with I only shop at Wal-Mart for ammo. The other day I found a pack of 100 .223 Remi and purchased. Went back to get another and they were all gone. None of the above calibers I mentioned but a lot of other stuff such as .357 mag, .380, and every rifle caliber you can think of except .223/5.56 or .308.

Thats my $.02. I'm sure Federal knows whats selling and that is what the are concentrating on making.


And .22lr. Have you tried to find .22lr at Wally lately?

Good luck with that shit.


Link Posted: 1/27/2009 12:37:16 PM EST
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