Business Notes Weapons

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They are no longer the weapons of choice for mobsters and G-men, but machine guns are suddenly selling like gangbusters. Reason: a law signed by President Reagan on May 19 prohibits the production of machine guns for sale to the public any longer. The ban has prompted a rush by collectors to snap up supplies while they last.

Just before the cutoff date, Auto-Ordnance of West Hurley, N.Y., manufactured an extra 1,000 of its fabled Thompson submachine guns--the equivalent of a normal year's sales. Now, says Vice President Doug Nichols, "only a few hundred remain. Because production has stopped, they are going to become collectibles, and people are buying them for their long-term investment value." Since April, the going price of tommy guns has climbed from about $1,100 to $2,100. This type of investment has disadvantages, though. Buyers of the machine guns must get the approval of the local police chief and must also be fingerprinted.