In the past decade, electric guitar sales have plummeted, from about 1.5 million sold annually to just over 1 million. The two biggest companies, Gibson and Fender, are in debt, and a third, PRS Guitars, had to cut staff and expand production of cheaper guitars. In April, Moody’s downgraded Guitar Center, the largest chain retailer, as it faces $1.6 billion in debt. And at Sweetwater.com, the online retailer, a brand-new, interest-free Fender can be had for as little as $8 a month.
What worries Nashville dealer George Gruhn is not simply that profits are down. That happens in business. He’s concerned by the “why” behind the sales decline. When he opened his store 46 years ago, everyone wanted to be a guitar god, inspired by the men who roamed the concert stage, including Clapton, Jeff Beck, Jimi Hendrix, Carlos Santana and Jimmy Page.Now those boomers are retiring, downsizing and adjusting to fixed incomes. They’re looking to shed, not add to, their collections, and the younger generation isn’t stepping in to replace them.