The Keefe Report: Meanwhile, in a Georgia Trailer … What's Going on With HK USA?

Under most circumstances, a new trailer or two going up in Georgia is neither uncommon nor a cause for concern. But a group of trailers and a new 50,000 sq.-ft. building built in Columbus, Ga., should make the firearm industry pay attention. Because those trailers and that new building belong to a subsidiary of German manufacturer Heckler & Koch GmbH, and the sign on the door reads “HK.” 

Heckler & Koch as a company selling firearms commercially in United States has been, somewhat, schizophrenic—not news when it comes to European-owned companies. There've been a couple of different owners, and some false steps. Rumors that H&K will no longer sell firearms on the commercial market pop up about every six months then need to be stamped out. 

 

The Oberndorf maker, rightly, is best known these days for its military firearms, in particular the MP-5 submachine gun (right). And, of course, the HK 416 (left), you know, the gun Navy SEALs used to bring 5.56x45 mm justice to Osama bin Laden? In recent years, much of its handgun production had been going to federal law-enforcement through big DHS contracts. And every teenager in the country with a gaming console knows HK’s guns.

But the company, whose real company motto is ”No Compromises” (it used to be just “No Compromise,” singular, not sure where the plural came from) has, at times rightly, taken it in the teeth from American consumers. Between a lack of availability, high prices and arrogant (at times) customer service, while, it says “No Compromises” on the website, the chat rooms say the real company motto is "you suck and we hate you." 

And it didn't help when the majority of the company’s rifle and carbine line was prohibited from importation by President George H.W. Bush’s 1989 executive import ban. What do people want? HK94s, HK91s. Nope, banned by name. What they didn’t want was a goofy looking, semi-automatic rifle designed with French pig hunters in mind with a G36 gas system, an obtuse-looking wood stock—perhaps inspired by M.C. Escher—with happy swine laser-engraved on the receiver flat. Even when desirable guns were allocated to the commercial market, they were expensive. That changed with the VP-9 pistol, engineered to be really, really good, but affordable. Well, affordable for HK. And then when the company hits one out of the park, such as with the 9 mm Luger SP5K, they can't get enough of them.

Chasing big government contracts is either feast or famine. When business is good, business is good, indeed. But when it's not, what do you do? Companies like Winchester have made roller skates to get it through. No, it looks like HK will be focusing its U.S. operation on making guns for American consumers

Well, a new building and some trailers may not indicate where company is going, its personnel certainly can. The new CEO of HK USA is Francisco Hidalgo, an energetic executive with a lot of manufacturing and operations experience. Under the leadership of Hidalgo, HK USA is putting the resources, tools and people in place to make a big splash.

A couple of years ago, top-shelf sales guy Mike Holly, a veteran of Benelli and Savage, was hired by HK USA. Mike, who I've known for years, maybe even decades, is a human cyclone when it comes to firearm sales. If you're serious about selling guns in United States, you need a guy like Mike Holly. More recently, an experienced and savvy marketing guy was brought in, and his name is Bill Dermody. I've known Bill for decades, too. He started off as marketing guy for Browning—remember the "Show Us Your Buckmark" campaign back in ‘90s? That was Bill. Then he went to Springfield Armory and help build the success of the XD pistol. From there he went to Savage, got the moribund bolt-rifle maker into the MSR business in a big way and, after 10 years there, he took a job at HK USA.

The workforce assembled in Columbus, I’m told, includes a polyglot of both Americans from DPMS, FN, Glock, Kimber, Remington and Germans from HK in Oberndorf. And Alexander Arms—the company that brought us the 6.5 Grendel and the .50 Beowulf and the .338 Lapua Mag. Ulfberht. The Ulfberht (which has a bolt cleverly based on the Degtyarov) was the first, and only that I am aware of, 338 Lapua Magnum semi-automatic precision rifle that works. That was Bill Alexander. The other Bill, who is terribly British, used to work for the British Ministry of Defense, and he had experience working with HK before he came to the United States to do what he loves—design guns. Now his employee ID reads “HK USA.”

I talked briefly to the first Bill (Dermody), and while tight lipped, he did say the engineers were out of the trailer park and at work on new guns for the U.S. consumer market.

Frankly, the best way to get serious about U.S. commercial market is to make guns here. There are no restrictions like the BATF point system, the Bush import ban or import duties. And exporting guns from Germany isn't getting any easier. I've not heard it from HK, but other German manufacturers have expressed concerns about the government trying to stifle their business. Too, the word is that the vendor in New Hampshire doing much of the work on the HK 416s sold commercially over here has a lot of capacity available. Wonder if that has anything to do with that new building in Columbus?

How serious is HK? We will know for sure if a biergarten goes up in Columbus sometime soon.