1. The Kiesel breakoff seems to have hurt Carvin as far as BASS guitars go. IMO
2. Unusual bass styles no one has really taken to. IMO.
3. Instruments so good these days from everywhere that Carvin is not price competitive anymore.
4. But still pay US wages.
5. Poor reputation for amp failures.
6. So many quality boutique builders at competitive prices.
7. Incredible deals on all kinds of used instruments, way below Carvin prices.
8. I saw a poor instrument reveal video by the Kiesel son, which seemed unprofessional and desperate to me.
9. Carvin name is just not as powerful anymore.
It seems that until technology had caught up - that Carvin filled a real need. A quality American instrument, at below Fender prices with some customization. BACK IN THE DAY. Now, you can get what you want almost anywhere, and below Carvin prices for comparable quality or better.
I'm not too in tune with their guitar business, but I imagine that it's their pro audio gear and regular guitars that will keep them in business.