Federal Cartridge Makes Another Job Cut

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Federal Cartridge laid off another 14 workers this week, bringing the number of workers dismissed so far this year to 186 as the Anoka based ammunition maker copes with declining demand.

In three actions since March 1, Federal Cartridge has downsized from 1,430 workers in Anoka to about 1,246.

The most recent layoff occurred Wednesday, affecting warehouse employees who work a mile from Federal’s manufacturing plant.

Executives said gun and ammunition sales spiraled downward following the election of President Donald Trump, a gun rights advocate. Because Trump opposes new restrictions and laws on guns, enthusiasts no longer worry that access to their favorite guns or ammunition may be banned.

“Inventory levels have remained high since the election and we are waiting for those inventories to clear. In the meantime, we are finding ways to manage our efficiencies,” said Amanda Covington, spokeswoman for Federal’s parent firm Vista Outdoors.

Firms such as Winchester Ammunition and American Outdoor Brands, formerly Smith & Wesson, have also seen consumer sales or stock prices fall since the November election.

The timing of the slowdown is particularly bad for Federal Cartridge. Last year it announced a $33.9 million factory expansion and efficiency project in Anoka. At the time, the company had promised to create 50 new jobs in exchange for a $1.15 million grant from the state of Minnesota.

The company has since rescinded its grant application after acknowledging it may not be able to deliver the promised jobs. Covington said the efficiency project remains on track.

In May, Vista Outdoors reported that fourth-quarter sales fell 5 percent, while profits plunged 10 percent.

“We are experiencing unprecedented decline in demand for ammunition and firearms following the presidential election and softness in the retail environment,” chief executive Mark DeYoung said at the time.

He said the company is expanding its brands’ e-commerce presence, cutting jobs and other costs and looking for other efficiencies to manage the pressure on revenue.

— Originally Published on StarTribune

Varminter Magazine
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