Primers

[EricBu]

I think it’s a leap to say they’re not running extra shifts so they can raise prices. Certainly their filings don’t say that? I think that’s the question.

No, they're not running extra shifts because......why should they? I think that's where you're hanging up here. They have no reason to produce more right now. They are caught up on their gov contracts, meeting their organic demand, so why should they take the HR hit? Come on, you're a smart man.......if they maintain the same profit, why should they spend more money to get there? Labor is the single biggest sole cost in the primer manufacturing process.....and reducing it is the quickest way to increase profits. They have no vested interest in lower prices. In other words, you're looking for a statement that "we are reducing output to artificially inflate prices", when you should be looking for the statement that "while we are still facing challenges within the industry, we are no longer seeing a need for additional labor costs, and have been able to reduce labor to pre-pandemic numbers at two facilities, increasing our positive outlook moving forward to the next fiscal year and continuing are record profits that our share holders have come to expect." You see the difference?

 

[JFrank]

Hahahah, I can tell you haven't actually read those. Read back a few, there's a little jewel in there. Also, understand, that's a press release...they aren't going to say "we're a monopoly now so are going to keep the prices high. Now that you've found those, you can probably chase down the SEC filings, and some of the stock anaylysts reports and forecasts. Hint: the stock anaylyst forecasts are where the really good dirt comes out.

Your correct I have not read 59 pages of press releases, nor do I want to. I posted that for other readers, your mind is made up.

 

[CQB45ACP]

Absolutely, but Winchester never had more than 10% of the consumer ammo and primer market, they've always concentrated more on their gov contracts. Remember, the Vista monopoly is still new, we've not seen the full impact. Several years ago, we had 4 major competing companies, they kept each other in check. Now we have 2, and 1 (Ohlin/Winchester) is a tiny player overall. I'm hoping they'll grow that side of the business. Their product is a solid 20% cheaper than Vista's at the distributor (tier 3 and 4) level right now...but they can't ship enough to hurt vista.

Didn’t know the focus & size differential.

So here’s my cynical conspiracy theory…how in the world did the FTC & DOJ allow such an anticompetitive consolidation of the ammunition industry?

Could it be someone wants to permit the focusing of all things ammo manufacturing into as small a universe of producers as possible? One would be ideal.

Then, you can choke, regulate, control finances far more easily OR maybe even better yet, a gazillionaire of the correct philosophical persuasion can buy it lock, stock, and barrel.

Controlling ammo of course controls firearms only without the need to confiscate.

 

[EricBu]

Your correct I have not read 59 pages of press releases, nor do I want to. I posted that for other readers, your mind is made up.

Yes...because I have read them all...I'm on the mailing list......I've also made a few pennies off their stock during the past 3 years, and watch it closely. This is why my mind is made up...because the research means something to me...I have a vested interest in getting primers, and investing in stock like Vista's is a offset for my business, much like cattle ranchers trade cattle futures...sadly, there is no ammo futures, or I'd be a bazzilionaire right now;-(

 

[EricBu]

Didn’t know the focus & size differential.

So here’s my cynical conspiracy theory…how in the world did the FTC & DOJ allow such an anticompetitive consolidation of the ammunition industry?

Could it be someone wants to permit the focusing of all things ammo manufacturing into as small a universe of producers as possible? One would be ideal.

Then, you can choke, regulate, control finances far more easily OR maybe even better yet, a gazillionaire of the correct philosophical persuasion can buy it lock, stock, and barrel.

Well, the FTC and DOJ aren't going to do a damn thing unless somebody (with resources) complains. Look at past monopolies and how far they've gotten without action? I don't expect any gov action to make any difference until such time as the DoD makes an argument that lack of domestic powder production is a critical national defense issue with regards to the powder industry...and of course that won't fly for primers....because there is enough to meet NS needs, and the "no monopoly" argument is that Winchester still exists as a seperate entity, and imported products provide the comp (of course, the slow/choke on permits makes that technically accurate but not realistically accurate). Is there light at the end of the tunnel? Sure, things will get better some day. There are a lot of avenues to break that monopoly, only time will bring them to fruition.

 

[gifbohane]

Target Sports USA has a variety of them for 450.00/5K including shipping and hazmat. Best price going right now.

Just checked at Target..."Out of stock." Not desperate yet, but going in that direction fast.

 

[EricBu]

Just checked at Target..."Out of stock." Not desperate yet, but going in that direction fast.

Still got Winchesters in stock. 415 + 30 Hazmat for 5K They have bricks for 83.00 ea, plus the hazmat...but since they don't have limits, I personally see no reason to buy just a brick. 445.00 shipped for 5K is right there these days..and they have them, and they ship quick.

https://www.targetsportsusa.com/winchester-small-pistol-primers-1-1-2-box-of-1000-wsp-p-112637.aspx

 

[GeoDudeFlorida]

Well, the FTC and DOJ aren't going to do a damn thing unless somebody (with resources) complains. Look at past monopolies and how far they've gotten without action? I don't expect any gov action to make any difference until such time as the DoD makes an argument that lack of domestic powder production is a critical national defense issue with regards to the powder industry...and of course that won't fly for primers....because there is enough to meet NS needs, and the "no monopoly" argument is that Winchester still exists as a seperate entity, and imported products provide the comp (of course, the slow/choke on permits makes that technically accurate but not realistically accurate). Is there light at the end of the tunnel? Sure, things will get better some day. There are a lot of avenues to break that monopoly, only time will bring them to fruition.

They aren’t a legal monopoly until they take direct action to prevent a potential competitor from entering the marketplace or to force an existing competitor out of the marketplace. Effective monopolies are not illegal and illegal monopolies are not always effective. The government is a legal monopoly. Government has a monopoly on the use of deadly force in order to compel compliance.

 

[Zendude]

I understand that Beretta is getting into the consumer ammo market via the Norma brand. I don’t know if they will offer components for sale though.

Did Remington have any other serious offers other than Vista? If not, then I don’t know if Vista intentionally monopolized the market. If Remington had gone bankrupt with no buyers, then there wouldn’t be any more or less competition than there is today.

 

[EricBu]

They aren’t a legal monopoly until they take direct action to prevent a potential competitor from entering the marketplace or to force an existing competitor out of the marketplace. Effective monopolies are not illegal and illegal monopolies are not always effective. The government is a legal monopoly. Government has a monopoly on the use of deadly force in order to compel compliance.

Exactly right. A good example of Vista engaging in activity to force a competitor out of the market would be the opposite of what they are doing. They could add more plants, more personnel, increase output, and drive the price down on their ammo and primers so low...that Winchester can't compete and files for bankruptcy. Winchester might make a case, but the expense of pursuing it would probably be meaningless. But Vista's current strategy...well, it benefits Winchester too. Everybody is happy.....but us poor schmucks stuck paying .10 a primer.

Edited to add: I would bet a decent amount that Vista also has some lobbyists on the payroll and is dumping big bucks into various PACS and working behind the seens in DC pushing an anti-ammo/primer import agenda too. If only politicians wore NASCAR style jackets with their sponsors.

 

[EricBu]

I understand that Beretta is getting into the consumer ammo market via the Norma brand. I don’t know if they will offer components for sale though.

Did Remington have any other serious offers other than Vista? If not, then I don’t know if Vista intentionally monopolized the market. If Remington went bankrupt with no buyers, then there wouldn’t be any more competition than there is today.

Remington got carved up and sold to a few different companies. Vista bought locations, equipment, and the names for their primers and their ammo brands. Ruger got the Marlin brand. I have a white sheet somewhere with all the breakdowns, but it was hot garbage. Nobody was messing around since it was their second bankruptcy in a very short period of time....investors wanted blood and some immediate compensation.

 

[Jim Watson]

I bought some of those WW SPs the last time TS got in a supply.
I caught CCI SR at Academy for $67. A hammer fired 9mm shoots small rifle primers reliably.
I only bought a couple thousand, probably 1/3 of their stock, and told a friend. He sent his wife in who cleaned them out and bought most if not all their $100 LR. She said she was glad she didn't get mugged for $700 worth of primers in the parking lot.

It is ironic that CCI and Speer got started selling reloading components because RP and WW did not much support hand loading, they obviously preferred selling ammo. Just look at them now.

 

[Laphroaig]

Exactly right. A good example of Vista engaging in activity to force a competitor out of the market would be the opposite of what they are doing. They could add more plants, more personnel, increase output, and drive the price down on their ammo and primers so low...that Winchester can't compete and files for bankruptcy. Winchester might make a case, but the expense of pursuing it would probably be meaningless. But Vista's current strategy...well, it benefits Winchester too. Everybody is happy.....but us poor schmucks stuck paying .10 a primer.

Sounds like textbook capitalism to me. Trouble is, the alternative is way worse.

 

[EricBu]

Sounds like textbook capitalism to me. Trouble is, the alternative is way worse.

It's all text book capitalism...until it isn't;-)

 

[CQB45ACP]

Well, the FTC and DOJ aren't going to do a damn thing unless somebody (with resources) complains. Look at past monopolies and how far they've gotten without action? I don't expect any gov action to make any difference until such time as the DoD makes an argument that lack of domestic powder production is a critical national defense issue with regards to the powder industry...and of course that won't fly for primers....because there is enough to meet NS needs, and the "no monopoly" argument is that Winchester still exists as a seperate entity, and imported products provide the comp (of course, the slow/choke on permits makes that technically accurate but not realistically accurate). Is there light at the end of the tunnel? Sure, things will get better some day. There are a lot of avenues to break that monopoly, only time will bring them to fruition.

Anticompetitive behavior includes far more than monopolistic actions. I recall in the pre-amazon days, Office Depot & Office Max merger was quashed not because there would be a monopoly but because the consumer would be unfairly disadvantaged which means whatever regulators say it means.

In a previous life I was OMB’s rep on an interagency committee looking at proposed foreign investment in US firms. It was supposed to focus on national security issues as commonly understood but the fact was any modestly coherent argument could make anything a national security issue. The same can be said for anticompetitiveness. It all depends on which advocate is most articulate.

 

[GeoDudeFlorida]

Exactly right. A good example of Vista engaging in activity to force a competitor out of the market would be the opposite of what they are doing. They could add more plants, more personnel, increase output, and drive the price down on their ammo and primers so low...that Winchester can't compete and files for bankruptcy. Winchester might make a case, but the expense of pursuing it would probably be meaningless. But Vista's current strategy...well, it benefits Winchester too. Everybody is happy.....but us poor schmucks stuck paying .10 a primer.

Edited to add: I would bet a decent amount that Vista also has some lobbyists on the payroll and is dumping big bucks into various PACS and working behind the seens in DC pushing an anti-ammo/primer import agenda too. If only politicians wore NASCAR style jackets with their sponsors.

Remember the AT&T Divestiture? The cost of local service rose faster than the rate of inflation but the cost of long distance fell - albeit at a much slower rate. Some lessons have to be learned over and over and over and....

Like Carlos Santana said, “People who read history books don’t buy my albums.”

 

[EricBu]

Anticompetitive behavior includes far more than monopolistic actions. I recall in the pre-amazon days, Office Depot & Office Max merger was quashed not because there would be a monopoly but because the consumer would be unfairly disadvantaged which means whatever regulators say it means.

In a previous life I was OMB’s rep on an interagency committee looking at proposed foreign investment in US firms. It was supposed to focus on national security issues as commonly understood but the fact was any modestly coherent argument could make anything a national security issue. The same can be said for anticompetitiveness. It all depends on which advocate is most articulate.

You're right, but like I said.......somebody with resources has to complain.

 

[CQB45ACP]

Exactly right. A good example of Vista engaging in activity to force a competitor out of the market would be the opposite of what they are doing. They could add more plants, more personnel, increase output, and drive the price down on their ammo and primers so low...that Winchester can't compete and files for bankruptcy. Winchester might make a case, but the expense of pursuing it would probably be meaningless. But Vista's current strategy...well, it benefits Winchester too. Everybody is happy.....but us poor schmucks stuck paying .10 a primer.

Edited to add: I would bet a decent amount that Vista also has some lobbyists on the payroll and is dumping big bucks into various PACS and working behind the seens in DC pushing an anti-ammo/primer import agenda too. If only politicians wore NASCAR style jackets with their sponsors.

example of anticompetitive behavior that is not also monopolistic.

 

[CQB45ACP]

You're right, but like I said.......somebody with resources has to complain.

Maybe to be “heard” but not to complain. This is where bureaucratic process is the citizen’s friend. The FTC or DOJ or both would publish for notice & public comment in the Federal Register the proposed merger or acquisition and responsible officials would have to publicly respond. Also of course we have representatives in Congress to complain to.

I’ll wager, but won’t go digging for, public comments were made.

 

[EricBu]

example of anticompetitive behavior that is not also monopolistic.

Right, but we call that politics. And it's only a problem, when it becomes politically beneficial to suddenly go after that. Like Tobacco and Pharmacy companies spending 4 billion dollars to create market barriers to the vaping industry. You think Marlboro is worried about your health? Johnson and Johnson? No, vaping impacted tobacco sales, and nearly destroyed the 10 billion dollar nicotine replacement therapy pharmaceutical industry. So (enemy of my enemy is my friend) so they created an alliance to fund multiple pacs and political campaigns in place to help protect their profits. This is why you can't buy an ecig on amazon, but you sure as heck can choose between 20 different pipes for smokin' the gange. Logical? Not at all....but this how politics work now isn't it?

 

[Laphroaig]

I think it’s a leap to say they’re not running extra shifts so they can raise prices.

The current labor/supply chain environment probably has quite a bit to do with the situation. I'm sure they want to make and sell as many primers as they can, especially at today's prices.

I did buy some Rem 71/2 BR primers from Cabelas yesterday for in-store pickup. $90/K and I paid with gift cards which deadened the pain. SR primers was the weakest area in my reloading supplies so I'm happy!

 

[higgite]

I don’t buy the firing or laying people off to limit production and jack up prices concept either. If that was a sound business practice, mass production would never have gotten off the ground. The price is simply what the market will bear.

 

[CQB45ACP]

Right, but we call that politics. And it's only a problem, when it becomes politically beneficial to suddenly go after that. Like Tobacco and Pharmacy companies spending 4 billion dollars to create market barriers to the vaping industry. You think Marlboro is worried about your health? Johnson and Johnson? No, vaping impacted tobacco sales, and nearly destroyed the 10 billion dollar nicotine replacement therapy pharmaceutical industry. So (enemy of my enemy is my friend) so they created an alliance to fund multiple pacs and political campaigns in place to help protect their profits. This is why you can't buy an ecig on amazon, but you sure as heck can choose between 20 different pipes for smokin' the gange. Logical? Not at all....but this how politics work now isn't it?

There you go down into the dark recesses of cynicism.
Go load some cartridges and worry about COL. I find it therapeutic.

 

[CQB45ACP]

The current labor/supply chain environment probably has quite a bit to do with the situation. I'm sure they want to make and sell as many primers as they can, especially at today's prices.

I did buy some Rem 71/2 BR primers from Cabelas yesterday for in-store pickup. $90/K and I paid with gift cards which deadened the pain. SR primers was the weakest area in my reloading supplies so I'm happy!

Gotta love in store pickup

 

[EricBu]

There you go down into the dark recesses of cynicism.
Go load some cartridges and worry about COL. I find it therapeutic.

That will happen today. Got to finish maintenance on the small pistol machine so that I can run out 357. Got about 10K Fed small pistol magnum match primers that need rehoming;-)