Last month Smith & Wesson, one of the top gun manufacturers in America, reported a steep drop in sales in its latest quarterly earnings report. Sales plunged more than 10 percent, and forecasts warn of a further decline in the coming year. This was a huge surprise to investors considering that the company is the second largest publicly traded firearms manufacturer in the United States.
Profits came up short due to a decline in “long rifle” guns. More specifically, sales of assault style weapons have seen the most precipitous decline. This coincides with a steep decline in the number of background checks conducted in the early part of this year when compared to the same time last year.
Gun ownership has seen a continuing decline since the 1980s. During that period, nearly 50 percent of all American households owned at least one firearm. Over the next two decades, however, the number of gun owners decreased dramatically, even though firearm sales went up. The trend in fewer owners and more guns continued until 1993, which saw an era of lower crime and, ultimately, a lower fear among the public. Fear is the precipitating factor for gun sales, which showed another spike after the 9/11 terrorists attacks.
With violent crime down overall and fewer gun owners, gun manufacturers were constantly challenged with keeping gun sales up. The National Rifle Association, the lobbying arm of the industry, continues to pressure lawmakers to decrease restrictions on guns and ownership, even when most Americans, including gun owners, believe that these are reasonable requirements for public safety. Then just when things looked bleak, a new kind of fear emerged in 2008.
It was that year the fear of the black president swept (a small part of) the nation.
Believing that the Democratic majority and a popular (black) president would begin a liberal agenda that would confiscate guns from all the “real” Americans, gun “enthusiasts” began buying up assault-style weapons that gun control advocates have long been trying to curtail. Over the next few years, sales of ammunition and guns skyrocketed. In some paranoid circles, it was obvious that the fear was racially based. Rumors on the Internet warned of an impending race war and President Obama secretly creating plans to round up white people and house them in FEMA trailers.
Needless to say, this did not happen.
Sales increased even though the number of owners continued to drop. As of 2012, nearly all of the guns in the United States were concentrated in just over one-third of households – a decline of nearly 20 percent in the past two decades. It is estimated that there are more than 300 million guns in circulation, most of them in the hands of only 34 percent of the population.
The estimated population of the entire United States is 318 million.
In spite of evidence to the contrary, these fears continued, even as more mass shootings headlined the national news. In a rather perverse irony, sales of the weapons used in mass shootings spike after each horrific incidence, again due to the fear that the government would take action to outlaw them. After the deadly school shooting at Sandy Hook Elementary school in December 2012, sales of semi-automatic weapons sky rocketed. For nearly a year, gun stores reported a shortage of the weapons, as well as large capacity ammunition magazines, due to the high demand.
Even then, there was no serious movement on gun control.
While there have been some successful attempts to make the licensing requirements stricter and restricting the amount and types of ammunition sold, nothing has been done to ban specific types of guns in recent years. The Supreme Court has made impossible to eliminate guns, as recent rulings have expanded the Second Amendment to include a right to things like handguns and self defense. Needless to say, the government has not taken anyone’s guns.
It is perhaps due to the lack of movement on gun legislation that sales of guns have gone down. Now that the fear is being proven to be misplaced, these same gun enthusiasts are feeling less of a need to stock up on weapons that are generally best suited for war. Handgun sales are still popular, but gun manufactures, like Smith & Wesson, are seeing a decline in the assault weapons that have been a boon for their bottom line. Fear has been a great motivator for profits.
Only time will tell if this is a market correction after a spike in sales, or if indeed the irrational fears that have gripped the nation has finally subsided…at least for now.