Matt Stoller, Director of Research at the American Economic Liberties Project, joins me on the show this week to talk about the ongoing ammo shortage and the resulting price hikes we’ve all been experiencing lately.
Stoller recently wrote a widely-circulated piece on his Substack arguing the market dominance of Vista Outdoors and Olin Corporation contribute to the supply problems and price hikes. Those companies own many of the most popular ammo brands including Federal, American Eagle, CCI, Winchester, and Remington. Stoller says the companies use consolidation, such as Vista’s recent purchase of Remington’s ammo business, to better control market supply and pricing.
We discuss how much of an impact tactics like that can have in the ammo market in particular–especially since Vista and Olin have major competitors such as Sig Saur and Hornady. This is especially true given that ammo is distributed through many small stores rather than large chain retailers which means it is more difficult for major ammo makers to try and manipulate distribution channels.
And, of course, the price of nearly everything has increased over the past few years. Clearly that is also driving up the material costs for ammo makers too. The pandemic has led to increased demand, strained supply chains, and surging prices in many industries across the board.
But, Stoller argues consolidation is just one piece of the puzzle and the ammo business is just one example of how it blunts market forces. He describes how the ammo market’s high barrier of entry compounds the effects of consolidation and adds to supply constraints. Ultimately, he argues a few small companies dominating the market keep rising prices from quickly resulting in a rising number of suppliers.
In the end, that means record profits for Vista and Olin at the expense of the consumer.
I reached out to Vista and Olin for their side of the story but never received a response. I’d be happy to have somebody from either company on the show in the future, though.
Contributing Writer Jake Fogleman and I also cover the state agendas released by Everytown for Gun Safety. The leading gun-control group’s top priorities in each state give a guide for the battles over gun policy coming in the new year and what they leave out may be just as interesting as what they included.
Plus, Reload Member Dr. Jackson Crawford shares his background and what first got him interested in firearms. As an authority on a specific, and sometimes controversial, topic himself, he talks about what The Reload does that made him want to join.
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