February 25, 2018

THE WISDOM OF THE MARKET:

Why companies are abandoning the NRA (Danielle Wiener-Bronner, February 25, 2018, CNN Money)

Delta (DAL) is ending discounted rates for members of the organization. United Airlines (UAL) will no longer offer discounts on flights to the NRA annual meeting.

Enterprise Holdings, which runs the Enterprise, Alamo and National car rental groups, will end the discount deal it has with the NRA. So will Avis Budget Group (CAR), which owns Avis and Budget, and Hertz (HTZ).

Similarly, insurance giant MetLife (MET) is ending its discount program for NRA members.

The First National Bank of Omaha pledged to stop issuing an NRA-branded Visa card.

The National Rifle Association released a statement on Saturday saying companies "have decided to punish NRA membership in a shameful display of political and civic cowardice."

"In time, these brands will be replaced by others who recognize that patriotism and determined commitment to Constitutional freedoms are characteristics of a marketplace they very much want to serve," the NRA said.

At this point, businesses that work with the NRA are putting their relationships with customers at risk, said William Klepper, a professor at the Columbia Business School.

"Boards and their CEOs ... are saying, 'This is bad for business,'" he said.

Consumers are focusing their attention on businesses that work with the NRA, but gunmakers are losing customers, too.

After hearing from their clients, the giant investment management company BlackRock (BAAPX) told gunmakers that it wants to understand their response to the shooting.

The firm is the largest shareholder in weapons manufacturers Sturm Ruger (RGR) and American Outdoor Brands (AOBC). It is the second-largest shareholder in Vista Outdoor (VSTO), which makes sporting goods and guns.

Its questions are certain to let the gun companies know they're paying attention.

Bank of America (BAC) also said it will question gunmakers.

The bank plans "to engage the limited number of clients we have that manufacture assault weapons for non-military use to understand what they can contribute to this shared responsibility," it said in a statement.

Posted by at February 25, 2018 9:47 AM

  

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