Federal Cartridge Lays Off 70 due to SLACKENING DEMAND

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Dave R

New member
Tell me this is not an April Fools Joke. Slackening demand for ammo? Where? In another universe? And searching here didn't come up with any discussion on it. What the heck?

Source is McClatchy. Here's the url, and the scoop. There were earlier articles about another layoff in Nov '08 This article is Jan 9 '09. Then they were awarded an $8.something million contract from the Navy Jan 20...all in Google.

http://www.tradingmarkets.com/.site/news/Stock News/2115990/


Alliant cutting back up to 80 in Anoka: Layoffs will hit at least 70 Federal Cartridge workers because of a slackening in demand for ammunition.
Thu. January 08, 2009; Posted: 10:36 PM

Jan 09, 2009 (Star Tribune - McClatchy-Tribune Information Services via COMTEX) -- ATK | Quote | Chart | News | PowerRating -- For the second time in eight weeks, Alliant Techsystems is laying off workers at its Federal Cartridge ammunition plant in Anoka because of the end of an orders backlog, officials announced Thursday.About 70 to 80 workers will be affected. In November, 40 to 50 workers were let go. Federal Cartridge will have about 900 workers after the job cuts.
The cutbacks are somewhat of a blow to Alliant Techsystems, which has prided itself on steady employment and sales growth. Federal Cartridge makes police and hunting ammunition sold through Wal-Mart, sporting goods stores and to dozens of police departments around the country.
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.

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And the Nov '08 article

http://www.startribune.com/business/33942554.html
 
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Dave R

New member
They specifically mention sales to Wal-Mart, and my Wal-Mart has NO Federal ammo in stock. How can they be having slackening demand? This gets my conspiracy theory juices flowing.
 
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IDAHO83501

New member
Yeah Right.............

It has to be an April fools thing. Everyone is super low or out of Federal ammo everywhere I go in North Idaho and Eastern Washington. :confused:
 
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B. Lahey

New member
Horsefudge! I've been looking for several Federal loadings for months on end with no sign of any coming in anytime soon.

But it's not an April Fools joke, this story came out at least a week ago.
 
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jughead2

New member
federal

i was in my wal-mart today. i could have put everything they had except shot gun shells in a gallon bucket.:confused:
 
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Doyle

New member
My Walmart told me that Walmart corp discontinued their contract with Federal last year. They are going strictly Rem and Win now. On the plus side, I scored boxes of Fed classic 130 grn .270 for less than $13/box when they put them on clearance last fall.
 
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B.N.Real

New member
Wal Mart could be reconsidering ammo sales in the light of liability concerns due to certain recent political trends.
 
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flippycat

New member
well if you think about it, they are getting rid of less people then they just hired a year ago according to the article. Basiaclly weeding out what is no longer needed to maintain status quo when not behind.

They maybe using the current situation to justify the layoffs but I highly doubt that is the reason. What kind new equipment did they research to make the process just that much more efficient? They did not really go into detail about what kind of backlog they had a year ago to need 150 new people.

The lull they face NOW is more then likely a result from that year old back log in in regards to how they lost contracts.

1-2 months from now they will gain in supply contracts again and wind up having to to rehire 100 employees in 6 months to try to fill those backorders.

The majority of those laid off I am going to guess are from the last hire less then a year ago. ALL those people are coming up for annual review for a raise ;) Much more economical to lay them off then payout raises and get behind a little and then rehire at the lower rate if needed.

They also insight panic buying again and maybe even have company's reach out to them if they think they are "caught up" to start new contracts if they feel federal is ahead of the game and can help fill their demands :p

I think there is more to the story for sure and maybe some good business choices on federals part but also some gambles. Just my thoughts.

But I think it does not have anything to do with a conspiracy.
 
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deanadell

New member
Maybe it has something to do with the 6 million dollars Sportsman's Warehouse still owes them, according to the Chapter 11 filing......
 
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Dave R

New member
No doubt Sportsman's will hurt them. But you don't lay off workers if you have orders to fill. And there is no ammo on the shelves--and ALL the gun stores I have talked to have unfilled orders. So is Federal just losing market share?
 
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buzz_knox

New member
They probably see the way the market is going and are positioning themselves accordingly. It's not just current demand that's driving the matter but future demand. As people get "comfortable" with the administration and/or realize they can't spend money on things that won't immediately meet a need (i.e. food, clothes, mortgage), demand will slacken. Federal can increase its cash by reducing expenses now, and that cash will help them get through the future problems.
 
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azredhawk44

Moderator
So is Federal just losing market share?
Click to expand...

Could be.

I no longer buy their ammo at all, in favor of better manufacturers who have brass that lasts longer. Their bottleneck rifle brass is junk, IMO. Extremely soft shoulders more prone to deformation when feeding after 2nd/3rd reloading, loose primer pockets, and they tend to "grow" more on resizing than anyone else's brass. At least in my experience.

I'll pay the extra buck or three to get Winchester or Remington... or even go with Magtech, S&B or Prvi Partisan.
 
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ilbob

New member
rather than specualte, perhaps an email to someone there is in order.

from what i can tell they seem to be trying to get out of the low end ammo market and are pushing the specialty stuff.
 
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