Why Are Guns So Expensive?

[JohnBT]

"SO? GOOD for him - he saw a market need and filled it "

Did you wake up on the wrong side of the bed?

You completely missed the point. He didn't have any competition 20 years ago and was able to price his guns just below the cost of a traditional military or police sidearm and make a bunch of money in a hurry because his costs were a great deal lower.

Twenty years later - now - Glock has to compete with other makers using the same technology who are willing to compete with Glock on price.

In other words, do you understand now or do you need a picture?

 

[Kynoch]

Inflation does NOT affect all things equally. Just the opposite -- It's very uneven. Especially in this day and age when "bubbles" grow and pop with some regularity.

Gold has gone up 500% in the past 10 years, or so. Computer prices have been falling for decades.

Inflation pretty much impacts the costs of ALL US-made durable goods. I realize why Gatorade costs less today then it did in 1980. I don't know why guns have jumped in pricing compared to other durable goods made in the USA.

 

[JohnBT]

It seems like a cheap gun used to cost about one average monthly car payment and a good one was two month's worth. It still seems that way.

Of course I haven't had a car payment since 1986, so what do I know. I save the money up front a month at a time and pay cash. I get to collect the interest, not pay the bank.

John

 

[Kynoch]

If you think gun prices are high here, try looking at what they cost in other countries - we have it pretty good on most counts

Yet you have done nothing to answer my question.

 

[Kynoch]

I actually don't think guns are that expensive. They at least hold their value very well.

Tools, for example, I think are expensive. One Snap-On 3/8's ratchet can cost you over a hundred bucks. A set of combination wrenches will set you back over 300.

OK, go compare the price of a top-of-the-line Snap-On ratchet to a Ruger revolver. Both are made in the USA out of steel. The Ruger revolver has went up in price far more than the ratchet in the past 20 years. Why is that?

 

[Kynoch]

I'm with several others; I think many guns are cheap. Considering all the work, I don't know how Glock at $500, Beretta at $750 for a 92, or Taurus at $500 for a 1911, can make all the parts, assemble, and sell their products OFTEN THROUGH A DISTRIBUTOR, for anywhere near that price.

That's not what I asked though...

 

[WinThePennant]

Inflation pretty much impacts the costs of ALL US-made durable goods. I realize why Gatorade costs less today then it did in 1980. I don't know why guns have jumped in pricing compared to other durable goods made in the USA.

Simply not true. Not to throw around pedigrees, but my advanced degrees from top B-Schools have taught me otherwise. Inflation is, and shall always be, VERY UNEVEN.

People get confused because everyone follows the CPI and it is typically provided as a single number instead of a range, much less a detailed explanation of the sub-indexes and sub-sub-indexes. CPI is a measure of many goods, all of them with either falling or rising prices.

 

[Kynoch]

It seems like a cheap gun used to cost about one average monthly car payment and a good one was two month's worth. It still seems that way.

Of course I haven't had a car payment since 1986, so what do I know. I save the money up front a month at a time and pay cash. I get to collect the interest, not pay the bank.

John

But you're not answering my question. Someone used the comparison of Snap-on tools. I like that because most Snap-on is made in the USA, it's made of steel and it's top quality.

Snap-on hand tools have not increased 2x-3x in the past 20 years why many guns have. Compare the price of a set of Snap-on wrenches today versus 20 years ago and a Mini-14 today versus 20 years ago. The difference is astounding.

 

[whetrock]

IMHO a lot of the sky high prices we see in these times are nothing more than a reflection of inflation and the downward spiral of the federal reserve note. All in all we're making more money in this country than ever before it's just worth a great deal less. Even less expensive guns are of reasonable quality and capable of decent accuracy with all of the really cool and increasingly affordable CNC machining stuff it's getting easier for smaller outfits to churn out decent, affordable, well made firearms and at the same time allowing more competition in the market place.

 

[Kynoch]

Simply not true. Not to throw around pedigrees, but my advanced degrees from top B-Schools have taught me otherwise. Inflation is, and shall always be, VERY UNEVEN.

People get confused because everyone follows the CPI and it is typically provided as a single number instead of a range, much less a detailed explanation of the sub-indexes and sub-sub-indexes. CPI is a measure of many goods, all of them with either falling or rising prices.

I'm sorry but your comments have no application here. "Inflation" is NOT the reason that guns (at least most guns) have risen so much in price over the past 20 years while other US-made durable goods have not.

So far the only reason I accept is supply/demand. Looking into both sides of that can be quite interesting. Demand is up right now, no question. It will remain so until political and economic climates improve in the USA. There are also other facts at work on the demand side. Supply is another question altogether and it can become very intriguing.

 

[Kynoch]

IMHO a lot of the sky high prices we see in these times are nothing more than a reflection of inflation and the downward spiral of the federal reserve note. All in all we're making more money in this country than ever before it's just worth a great deal less. Even less expensive guns are of reasonable quality and capable of decent accuracy with all of the really cool and increasingly affordable CNC machining stuff it's getting easier for smaller outfits to churn out decent, affordable, well made firearms and at the same time allowing more competition in the market place.

That would impact ALL products though, and not just guns. Many US-made durable goods have not increased in price like guns over the past 20 years.

 

[WinThePennant]

I'm sorry about your comments have no application here. "Inflation" is NOT the reason that guns (at least most guns) have risen so much in price over the past 20 years while other US-made durable goods have not.

So far the only reason I accept is supply/demand. Looking into both sides of that can be quite interesting. Demand is up right now, no question. It will remain so until political and economic climates improve in the USA. There are also other facts at work on the demand side. Supply is another question altogether and it can become very intriguing.

I can only provide so much light. Unsubscribing from the thread.

Have a good day.

 

[Nuclear]

I would guess supply and demand, coupled with diversification of guns. Ruger (or any other maker of steel guns) can only make so many guns a year, across a number of models and calibers. The population of the US goes up every year, so even if there aren't a higher percentage of shooters (and collectors) in the population (which there is) the demand increases every year. And gun makers come out with new models and calibers, causing more demand compared to say a ratchet, which doesn't change that often. And how many ratchets do you own? I've bought 4, and I've worked on my own cars for 35 years (one was a replacement). I own more guns than ratchets.

 

[X-Rap]

If you really still don't get it after the responces so far I doubt that you will.

 

[joecil]

Well all I can do is guess on this since I've never done a complete financial study of the gun industry. So here goes my personal opinion.

First off it isn't wages of employees since odds are they have stayed the same or gone down over the last decade. Materials have also stayed with in a few percentage points giver or take 5%. So that leaves it to demand, which is way up with more guns being sold in the last 4 years than any other time in our history. It is to the point gun makers can't keep up really since for example Ruger stopped producing their 1911 till they could catch up with back orders. That appears to be about the same also for not only many popular guns as well as ammo in some calibers also. I might add I've seen ammo prices jump percentage wise even more than guns as well as a lot of scarcity of some calibers.

So it comes down to the administration in power at the time and currently we have a not a fan of guns in the white house. Now the facts have little to do with it since he has actually removed more gun bans than the previous administration did in 8 years in office. He has asked for or gotten a single bill that had anything to do with guns or ammo. Now to hear groups like the NRA, these forums etc one would think he was but facts are simple facts. Last but not least these groups are basing their opinion on what he may or may not do. So it comes down to conjecture there compared to what he actually has done.

Now most restrictive gun laws seem to come at a state or local level and not the federal level but are obscured by the federal nonsense for signing a treaty to stop nations like the US, Russia, China etc from shipping small arms to groups in small countries around the world none of which has anything to do with US internal laws. But it seems to work and more power to the groups as more states have changed there gun laws to less restrictive over the last few years which I'm all for regardless.

 

[whetrock]

You've got a point with all of the new CNC stuff and increasing competition between companies that should in theory curtail the price gouging a little bit through competition. I dunno, but doesn't freedom arms group and Cerebus own most of the US production gun companies. So maybe we are really fooling ourselves that they are actually brands competing against each other but rather all owned by the same corporation. I'm no economist and shouldn't really be commenting in this thread so please forgive me.

 

[jrdolall]

Want gun prices to go down? Start letting Chinese, Vietnamese, and Indian companies market and sell their guns in the USA. Tools are not significantly higher now becaus the market will not bear it. We will buy cheaper Chinese tools so the USA companies can only go up so far without pricing themselves out of business. Look at the textile industry. It is basically gone in the USA. Go to Macy's and try to find a set of sheets from the USA. If they have them they will be at least double what a comparable set from Vietnam or Honduras costs. I think everyone agrees that most goods made in China are of lower quality but the price incnets us to buy. Ever hear of Char Broil? Columbus GA compaby that moved all of their production to China a few year's back. They can build and ship to the USA cheaper than they could build here.

Put a comparable quality gun next to the S&W. Same look and feel and 1/2 the price and I bet Smith would start lowering their price before they allowed their market share to drop. Right now we do not have any cheap imported firearms other than milsurps and those are drying up.

I am not advocating this as i am 100% against importing what can be made right here so long as we can make it at a similar price.

 

[rajb123]

Simple: supply and demand governs prices.

...an 1858 pietta wheel gun was on sale recently for $179. It is very well made; probably from cnc machine tools....and its manuafacturing costs are going to be very close to the costs incurred to make a center fire Ruger wheel gun that sells for $600.

why is the 1858 selling at such a low price; low demand.

 

[Kynoch]

Why Are Guns So Expensive? Why not?

Demand and Supply my friends, if I can sell a good at a set price per volume why wouldn't I. Especially if the public will buy it, no matter how much they complain. As a lawyer I do it frequently.

I don't want to work more than two hundred hours a month (i.e. every four weeks). At price A. I can work one hundred hours a month and make x amount. At price B. I can work three hundred hours a month (yes I've done it, and taken a four day vacation to the Keys afterwards) and make x. At price C. I can work two hundred hours a month and x amount. If at price C. I ultmately make more money (working a lesser rate than A but a greater rate than B) why wouldn't I choose option price C. Yes will the demand be there with more clients waiting to purchase my services at price C, absolutely, but my overhead and stress will be lower at option C, rather than with A where i risk having no line of waiting clients, or with B where i risk overworking myself and having no clients waiting to purchase my services as I'm servicing them all and making only as much as option price C for a great deal more work.

If I ran a gun company my approach would ultimately be the same. Where can I maximize profit, have a large back order of my product, have a loyal customer base, and yet still reduce and minimizee my overhead and risk of liability. Gun companies don't owe the purchasing public anything, they produce a product we want, and we either buy it or we don't, and if the product is too expensive, another gun company will fill the void. That's how we got Kel-Tec, Ruger, Uberti, and Cimarron amongst a slew of others.

Capitalism is the name of the game my fellow gunnies, and we are all merely pawns, the smartest of us just learn to shop smarter and be more patient.

Supply and demand? OK, I'll buy that. But that doesn't answer the guts of the question.

With growing demand, prices can only be greatly raised if the market forces of competition don't come into play. A Ruger MKIII costs almost 3x what it did 20 years ago. What has kept Ruger's competitors from saying "hey, there's money to be made in .22 semi-autos. Let's tool-up?" That seems to be the case for example in plastic centerfire semi-auto pistols where competition has leveled the price of such guns pretty much to what Glock sells them for.

Harley-Davidson did a masterful job of keeping production just under demand for many, many years. They made a huge amount of money. The market response is that Victory/"Indian" motorcycles was born who are now taking a big chunk out of HD sales along with BMW, Ducati and other brands.

What about guns?

 

[Kynoch]

Simple: supply and demand governs prices.

...an 1858 pietta wheel gun was on sale recently for $179. It is very well made; probably from cnc machine tools....and its manuafacturing costs are going to be very close to the costs incurred to make a center fire Ruger wheel gun that sells for $600.

why is the 1858 selling at such a low price; low demand.

Yes, I very much agree with you. Good input. But my question then is how has the supply/demand been "managed" by many gunmakers for many models that has allowed them to increase prices so much in the past 20 years?

Making progress...

 

[Kynoch]

Want gun prices to go down? Start letting Chinese, Vietnamese, and Indian companies market and sell their guns in the USA. Tools are not significantly higher now becaus the market will not bear it. We will buy cheaper Chinese tools so the USA companies can only go up so far without pricing themselves out of business. Look at the textile industry. It is basically gone in the USA. Go to Macy's and try to find a set of sheets from the USA. If they have them they will be at least double what a comparable set from Vietnam or Honduras costs. I think everyone agrees that most goods made in China are of lower quality but the price incnets us to buy. Ever hear of Char Broil? Columbus GA compaby that moved all of their production to China a few year's back. They can build and ship to the USA cheaper than they could build here.

Put a comparable quality gun next to the S&W. Same look and feel and 1/2 the price and I bet Smith would start lowering their price before they allowed their market share to drop. Right now we do not have any cheap imported firearms other than milsurps and those are drying up.

I am not advocating this as i am 100% against importing what can be made right here so long as we can make it at a similar price.

So "limited competition?" OK, that might indeed be a reason. Let me ask this. Given the import restrictions why hasn't another US company said "wow, there is clearly money to be made in guns. We're getting into that market?"

 

[kludge]

1. Limitations/Laws on Manufacture and Distribution
2. Import limitation/trade barriers (see #1)
3. Supply limits based on #1 and #2.
4. Demand.

The firearms trade is not an open and free market by any stretch of the imagination.

If any Tom, Dick, and Sally could open up a firearms manufacturing business without all the restrictions, the cost of entry would be much lower and supply would increase to cover demand, and then some.

Like, if anyone with spare time on their CNC machine could crank out AR-15 lowers and 1911 frames and slides, and if people could order them without regard to interstate commerce crap, the bottom would drop out of the market. The rest of the parts that aren't "firearms" are already commoditized and available in infinite variety at every price point.

 

[The-Reaver]

Why are gold bars so expensive?

 

[oneounceload]

First off it isn't wages of employees since odds are they have stayed the same or gone down over the last decade

That would be wrong - wages have increased a lot - BUYING power hasn't. Another aspect of wages - taxes, insurances, etc, have gone through the roof. my wife's insurance has gone up a total of 40% in the last two years, and their reasons given are for the implementation of Obamacare - not even in effect yet. Municipals have raised taxes on everything they can for revenue, utility costs are higher, shipping costs are higher, marketing costs are higher - there is a WHOLE lot more involved besides the hourly wage paid a person and the raw material costs

You couple that with skyrocketing demand, and it is easy to see why some prices ahve gone up; however, in real $ terms, when compared to inflation/devaluation of the dollar, the makers have done a great job of containing prices

 

[Kynoch]

Freedom Arms = Remington+Marlin+H&R+Bushmaster+ammo makers, etc. By no means does it own "most" of the US gun production. There's still Ruger, Savage, S&W, Mossberg, etc. that build tons of guns. That's conspiracy theory stuff.

But you allude to a point that I won't completely discount. After getting their heads kicked-in for years, is there some collusion going on with US gunmakers?