Keefe Report: Smith & Wesson Latest Casualty in U.S. Army Pistol Trial

Well, it's out there now. As the U.S. Army’s labyrinth-like search for a new service pistol continues, there is one less famous name in the running. It was just announced on Friday that Smith & Wesson and its partner General Dynamics have been dropped, cut, benched, from the U.S. Army Modular Handgun System (MHS) trial designed to select the XM17—a process that has thoroughly confused many in the firearm industry and been plagued by bad press.

You might think a Securities and Exchange Commission filing an unusual place to news on the U.S. Army’s search for a replacement for the 9x19 mm U.S. M9, but at this point Smith & Wesson is the only company that’s talking about the trial. And that’s because Smith & Wesson is a publicly traded company and has to report to its shareholders and the SEC things privately owned makers do not. Not surprisingly, Smith & Wesson’s stock price took a dip after the announcement.

The other makers believed to still be in contention for the contract and the Army are not talking, and neither is the Army—yet. SIG Sauer and Glock are rumored to be leading the pack, and some have posited that the Army’s criteria were written around the SIG Sauer P320 pistol. Some of the same people said the same thing about the recent FBI contract, too, but a 9 mm Glock won that one. Awkward. The other known contenders are Beretta with its new APX pistol and FN America with a version of its FNS striker-fired gun.

This trial process has been one fraught with controversy. The confusing “Industry Days” and lack of a pre-selected chambering (just tell us what you want!) led to many firearm industry veterans scratching their heads. Too, a comment by U.S. Army’s Chief of Staff Gen. Mike Milley expressed frustration with the whole confusing and cumbersome process earlier this year. “If you gave me $17 million on the credit card, I could call Cabela’s tonight and outfit every soldier, sailor, airman and Marine, and I’d get a discount on it for a bulk buy.” And no doubt, General, you would make Cabela’s quarter, too. Things like that may lead to official protests by the losers if and when the opaque process declares a winner in the end.

And, many major manufacturers chose not to participate in the trial at all. Most conspicuously, Ruger, which had just introduced the Ruger American Pistol, decided to just sit the whole thing out, deciding that the payoff--up to perhaps $500 million worth of pistol contracts over time—probably wasn't worth it.

Beretta, which has supplied the U.S. M9 pistol since the 1980s to the tune of about 600,000 guns, tried to submit its updated M9A3 as part of a Product Improvement Plan (PIP) under its existing contract, but Army bureaucrats denied Beretta that opportunity. The U.S. M9 is now being made at Beretta’s brand new Gallatin, Tenn., facility after moving manufacturing of its handguns and shotguns out of the far-less-politically-friendly state of Maryland. Beretta reported has all its lines up and running, the tooling having been moved from Accokeek, and it is continuing to fulfill existing M9 contracts with guns made in Gallatin. Final approval and delivery of Gallatin-made guns is expected this fall.

The good news is that the M9A3 has been a hit with consumers and is selling very, very well. There's no word on whether the Beretta APX pistol is still in the running to become the XM-17, and Beretta is not talking (Neither is FN for that matter). I have not shot the APX yet, but from what I have seen, it will be a real winner for Beretta whether the Army buys it or not. Beretta, unlike Smith, is a private, family-owned company—probably the oldest family-owned company in the world. Certainly Beretta is world’s oldest gunmaker dating back to 1526. The Beretta family can announce whatever they want, whenever they want.

There's been little from the Army about how the trial is going—despite repeated request from this magazine. Smith was cut; are other makers out of the race, too? If Smith & Wesson knows, the other entrants no doubt know whether they were cut. The only reason we know the S&W Military & Police is out is because Smith had to announce it through the SEC. The other gunmakers are being polite and giving the Army the opportunity to make the announcement. And we look forward to the invitation for that press conference.