My thoughts about the big 4, your thoughts and comments.

[Warburton]

Brianel: I agree you with you. I didn't mean to imply that the new K-Line brochure was bad, only that it reflected their current tough situation. I'd prefer to see all the manufacturers scale back their catalogs to something like this. Lionel's Vol. 2 catalog this year was largely rehashed stuff from the first volume (for 2005 product), too. MTH, however, continues to pump out big catalogs.

[brianel027]

But Warburton, this isn't such a bad thing for K-Line on the surface. They've done smaller 2nd edition catalogs in the past with the emphasis of these catalogs on holiday season offerings like train sets. K-Line also used to offer a "Holiday Bonanza" package consisting of a variety of rolling stock and sometimes an engine.

Again, we've come to expect the companies to not only outdo eachother, but to outdo themselves with each catalog release. Today, this practice isn't to the benefit of the consumer or the train importers. Second edition catalogs need to be aimed at the newcomer market that comes about at the holiday season when they are most likely to be thinking about the possibility of a train set. The rest of us already know that the catalogs will be out around the time of the February Toy Fair and are speculating about them before January has ended.

For me, K-Line's current situation is best summed up by the fact they got caught with their hands in Lionel's R&D cookie jar - and seemed to think there was nothing unethical about it. K-Line's main engineer may be an amazing designer (so they say), but the wonderous products developed do no good if you have injunction preventing you from selling them.

Funny too that Williams doesn't put out big catalogs and they seem to do just fine. And neither does Weaver. And though I prefer other trains to what Weaver makes, I give them a lot of credit too: they make nice scale sized trains at I think the most affordable prices of all the others - and they make a good part of those trains right here in the USA. Yes, they do use foreign made components, but they seem to compete with all the other train importers.

Funny how the others stated they could no longer compete unless they moved production overseas. There's probably a better chance that one of these foreign based production train companies will fold before the company that still makes their trains right here in Pennsylvania, USA.

[Warburton]

I just received the new K-Line "Volume 2" catalog today in the mail: not much like their previous recent offerings! This one is really a brochure of (I think -- don't have it here with me now) 16 or 20 pages. It's a lot like Lionel's old "stocking stuffer" brochures they put out back in the early 90s. Plus a fair portion of the product was shown in the previous catalog. You can really see K-Line's problems reflected here.

[RI Jim]

I'm one of those who will buy the "high end stuff" as long as it's in the roadnames I want. I quickly lost interest in the toylike postwar stuff once Atlas and MTH appeared on the scene and started offering scale models. Limiting myself to a short list of roadnames (and they're not NYC, PRR, ATSF) limits my train purchases.

Since there seems to be a dearth of new stuff I'm interested in, I will now turn my attention (and dollars) into upgrading some of my older locos.

[Anonymous]

All good comments. There was a time when I might purchase4-5 new engines/sets a year but lately I have no interest in the new products. I tend to have more fun puying older lots, doing some cleaning and repairing and selling the rest. Ebay is still decent for that. Both my CP passenger set and my congressional set came from TrainZ off ebay. The price was good and they are easy to deal with.

Lately I have been satisfing my train fix by collecting late prewar stuff and finding the old model builder mags. I just moved and so had to tear down my old 12X24 layout, but when we do buy the new house and I am able to build another layout, I am pretty interested in building it completely the old fashioned way( old signals, track etc. custom buildings (well some anyway)). For one thing, I won't need to buy anything, and for a second reason, I won't have to worry about my circuit boards crashing and leaving me stranded, or where can I get tires for this or that. I guess, I am just sick of it all for the time being, so sick of it that I toss around the idea of selling all my newer stuff at times. Focusing on the older stuff will allow me to cool off to the present state of train affairs. Rant over

[palallin]

I am continually amazed by the plethora of engines which show up on eBay that have been run for "two laps" or "five minutes," reboxed, and then sold. Talk about taking a hit for as near no benefit as can be imagined.

Of course, as a buyer I can appreciate the humor in being able to pick up a nearly mint piece for MUCH less than mint price (I got my Frisco Mike for $375; MSRP $995, Street price on unopened boxes $895).

[1688torpedo]

I agree with Brian here. The Companies really have spread themselves and their resources too thin by trying to please everyone which cannot and will not happen anyway as the marketplace is too fickle for its own good. At one time everyone wanted a Big Boy or a Northern style Behemoth from Lionel & the other companies.Now that they have been made and even larger engines to boot. The pendulum has started to swing the other way and the Marketplace is shrinking.What will happen next? only time can tell

[laz 57]

AGENT 0-27,
I agree 100% with what you say.
K-line usually has a big blow out at the end of the summer and try to unload some of the stuff that doesn't sell. I have seen this pattern for the last few years. It would be nice if they would and the other companies give the price breaks in the begining when they start to unveil a product. But like you said "a kid in a candy store", mentallity.
laz57

[brianel027]

And meanwhile as we wait for the unfolding of this saga over time.... in another far off corner of the Internet universe, there's a conversation going about K-Line. Seems K-Line is shipping some of their new engines without the added electronic frills and as you might imagine, there are some who are very p-o'd about this.

While I understand the concept of getting what you pay for, I also believe the very audience that the train companies have been trying to please, is the very same audience that they never ever will be able to please fully.

K-Line is has made some darn nice, well-proportioned good-looking scale locomotives that are already competitively priced. Isn't that enough? Nope. Gotta have cruise control. They can't even be thankful they are at least getting product from a company that appears it could go under any day now. I suppose they'd be happier if they got absolutely nothing, which is what they would get if the company were to go under.

Some are saying K-Line should lower the prices of these feature-compromised locomotives. Maybe they should. Maybe the entire industry should also lower prices on all traditional non-control, non-scale trains since the profits from these products are going to help support the higher end trains that cannot and do not pay for themselves.

Even a fool (well, I hope) can see that all this vast amount of new tooling and new product development costs quite a bit of money. It maybe cheaper to do in China, but even if it costs $150,000 to tool up a new locomotive, that's still a big chunk of change for these companies. The money has to come from somewhere. Multiply that figure (and higher) for every new locomotive introduced in one single catalog. And if those new products are made in smaller production runs or get reduced in price, they obviously are not recouping all the initial investment costs.

Some of us have been saying for years to deaf ears that this hobby needs to focus a whole lot less on pleasing the unpleaseable adult high-tech market and start focusing on pleasing the audience that can be pleased. The K-Line Kid's 0 and Husky line were throw-away ideas. The only reason they were offered is that there was no investment or tooling costs. Too little, too late.

That isn't to say that there isn't a place for these new higher end trains. But watch a little kid in a candy shop... he/she wants everything. "I'll take this and this and this and a bunch of those and a bag of these and a carton of those other things." And given that little kids are only little kids, they cry and throw a fit if they can't have everything they want right then and now.

Hate to say it folks, but that's exactly how I see many of the adult buyers in the hobby these days. They want it all, want it perfect., want it to precise exact scale proportions in accurate road names and want it cheap to boot. Most of 'em are older and aren't as affected by the exodus of American jobs to overseas locations. Though they sure don't like it when their generous pensions and benefits get chopped.

The train companies have made the decision to chase this audience and now everyone in the hobby is paying for those poor lopsided decisions. Even those who are not in the hobby are paying for these decisions... there's no advertising, poor availability and visibility of starter products and there's the widespread perception that the train hobby is too expensive for ordinary folks.

And on the concept of "the big 4" I think the only thing that is big in this hobby is some egos and some britches. None of these companies are that big and they are certainly going to get smaller. It's just common business sense that if you want a company to grow, you have to aim, target and market your products at the biggest, widest, most varied audience you possibly can. Some of the train companies have done the exact opposite and are now reaping the so-called rewards.

[Anonymous]

Mackb4:

I agree that all of the firms are offering some very nice products, and I agree that it would be nice to see all of them survive. I'm not sure that will be possible, but I guess we'll know for sure some four or five years from now. My guess is that MTH will still be around, and that Lionel will also still be around, but probably under new ownership. Atlas will be a survivor because Atlas has sufficient involvement in the broader area of model railroading to keep it going in O gauge at some level, and Weaver will likely continue serving its niche. Williams will likely still be serving its important niche, as well, for as long as Jerry Williams wants to maintain his involvement. K-Line is a bit more problematic because they apparently have financial difficulties that are going to be very difficult to overcome in the near, let along long-term future.

But all of these firms need to adapt to a more realistic view of what their market is, and where that market is going. Devoting more attention to the larger, traditional toy train market, which helps the hobby to grow, while increasingly making the higher-end lines pay for themselves on an if-you-preorder-in-sufficient-quantities-we- will-make-it basis, is probably the best approach to start off with, but they're all going to have to do more than that to actively stimulate growth and remain healthy. It will be interesting to see how it all unfolds over time.

[mackb4]

Great feeds people [tup].There is more companies to consider,but the "Big 4" I was thinking of was: Lionel,MTH,K-Line and Williams.Weaver and Atlas and some smaller companies,all make nice items.But it seems like the "Big 4" are those that are hashed over the most on this forum.Just like in the automotive industry some will make gains and others will fall to the side.Personally, I hope they all survive the bashing [B)] their giving one another,cause it would be a great loss to those who are loyal to the company they prefer.My own felling is that one company,and that one being the one most people fill will fall [8](and most seem to think the same),will in fact be taken over by the healthest company [2c].

[Warburton]

Allan -- very well said! If anyone is paying attention to this thread, they could learn a lot -- and possibly avoid some buying mistakes, I think.
A pretty good way to force limits on one's buying (I think) is to lay only 027 track on one's layout; you can't run most of the new production/super expensive stuff on it. Or go with 031 max if you want to be only slightly less prudent. I have always absolutely refused to go beyond 031 and that alone has save me from being tempted to buy the 6-8-8-6 kind of stuff.

[Anonymous]

QUOTE: Originally posted by Warburton

It sort of looks like we're all pretty much in agreement here about overpriced, extra-featured trains. I wonder where the guys that BUY them are? Maybe working second and third jobs to pay for them???

They're at York, spending more money buying even more trains that they likely don't need and may never even run. Then, they'll eventually put 'em up on eBay or some such when the next "latest and greatest" comes out. It's an addiction that many find hard to resist, and about the only real change you'll see is when the overall economy starts to head south and more people are forced to tighten their belts. This winter may do it, if it's a severe one, but more than likely it will come from a combination of negative economic influences.

Meanwhile, aside from missing friends and the truly great social aspects of the event, I find that I don't really miss York, and I sure don't miss coming back home with an empty wallet, a maxed-out credit card, and a trunk full of trains that I really don't need. I may buy a K-Line Porter in the near future, but I can easily get that and some other small items I may want via mail order, and at prices as good as I would expect to find at York--far better, in fact, when one takes into account the cost of attending that event in terms of food, lodging, gas, and the like.

I really enjoy the York Meet, and I do love to buy a new train now and then, but it's also very satisfying to look around me here in my home and realize that I have enough toys to keep me occupied for the remainder of my lifetime even if I don't buy a single additional item in the future.

I've been reading various model railroading forums ever since forums first appeared on the Internet, and I've seen it happen time and time again: Some guys will go on a "gotta have it' binge for a few years or so, and then wake up one morning to the realization that their habit has gotten out of hand. Often enough, they'll panic and ask others what they should do to curtail their spending. And those others will offer sage advice, which may be heeded or which may only be temporarily heeded before the individual jumps headlong back into his buying habit. Eventually, though, reality has a way of catching up, and these overly compulsive individuals begin to recognize that there's a lot more to this hobby than just handing over money to the manufacturers. Some then head in the opposite direction and try to dispose of all the "stuff" they've accumulated, only to learn that in the 21st century, toy trains rank little better than used cars when it comes to getting a decent return on investment.

All of that is fine if the individual is ready to accept the harsh realities of the situation, and if he has gained pleasure from the items he has. But folks not prepared for those realities often get discouraged and disheartened to the point where they abandon the hobby altogether. I really hate to see that happen, regardless of the cause.

Meanwhile, the more prudent among us--those who can do a lot with a little--observe ongoing developments with a sense of shock and awe, and can take a well-deserved pat on the back for being informed, rational, and satisfied participants in this great hobby.

[Warburton]

It sort of looks like we're all pretty much in agreement here about overpriced, extra-featured trains. I wonder where the guys that BUY them are? Maybe working second and third jobs to pay for them???

I just got one of those Lionel "starter set" 4-4-2 steamers (Lionel Lines). It's a beauty -- smokes great, air whistle works, pulls a long line of cars, AND it was $87! That's the kind of thing that's getting my $$ these days. The fun is all there!

[laz 57]

ALLAN,
Great point of focussing on something that meets the expectations that you have in mind. I too have many more trains then I need but when it comes to a specific look you want you simply say I need to have that. Its funny how the mind works, but having the will power to say not now is great. I have to start doing more of this and when my eyes are "glazed over" at YORK this weekend I'll try to have some of that will power.
laz57

[Anonymous]

QUOTE: Originally posted by Warburton

Allan -- which (I think) proves my point: greed on part of both manufacturers (make lots more products oversees for a lot less cost but keep prices up there) AND consumers (give us more choices, more detail, more features and keep a lid on the price). I totally agree with you that the shakeout has already begun. All we can do is sit back, see what happens and enjoy all the neat trains we already have!

No question about it! I imagine that most folks on this forum, whether they are willing to admit it or not, already have more trains than they can comfortably use, and I'll bet that darn few are so "deprived" that they really can't move forward in the hobby without buying yet another new locomotive.

It's all just a matter of the consumer mentality that is so pervasive in this country. For some reason, we seem to think that the measure of our success is determined by the quantity of "things" we possess rather than what we do with those things. I have been guilty of that sort of behavior myself in the past, but rather drastically changed my attitude toward that sort of thing a few years ago. I still buy trains from time to time, of course, but at nowhere near the level that I did as recently as three or four years ago. Nowadays, I simply wait for something that meets one of the focused themes I have chosen, and I have selected themes that, for the most part, are guaranteed to keep my budget in line.

[Anonymous]

Its flat all right, now there are only 7000 Lionel items on ebay, during the peak there was 13000, 14000 and prices are clearly down. new releases that list for $45 can go for less than $20........... Of course the stuff I want is still not cheap enough:)

[Warburton]

Allan -- which (I think) proves my point: greed on part of both manufacturers (make lots more products oversees for a lot less cost but keep prices up there) AND consumers (give us more choices, more detail, more features and keep a lid on the price). I totally agree with you that the shakeout has already begun. All we can do is sit back, see what happens and enjoy all the neat trains we already have!

[brianel027]

I agree with you Jim that the high end stuff is here to stay more than likely.

The problem was that the companies dived head-first into the high-end product market and focused nearly all their assets in this direction. The majority of the market has been left with the same kinds of products that have pretty much been made for the last 50 years (many times in the exact same road names too!).

I felt years ago, and still do, that instead of two crammed full catalogs each year, the companies should have done one large complete catalog and another smaller one later in the year aimed solely at the beginners market with the lower-cost items that would appeal to traditional modelers on a budget and beginners.

Despite the fact that there are a few very good deals today (especially from Lionel) in the way of train sets, perceptions are everything. When a newcomer looks at what has been the typical catalog, they are more than likely shocked and turned away. I've seen this happen far too many times. The catalogs have been utter lopsided affairs with the vast majority of offerings aimed at the adult market. The interested parent with a child takes one look at those catalogs and an immediate perception is formed that this is NOT a hobby for children anymore - even though it is and even more than ever!!!

And by the way, the cost I hear for a box car made in China is about $2.00 including shipping - though this could be higher now with increased fuel costs. There's no question in my mind all trains are overpriced, with the money going mostly to support all this new tooling for the adult market and to pay for the salaries/engineering costs for develpment of all this new product.

[FJ and G]

Tom, Doug,

When I saw the big 4 I was thinking BNSF, CSX, NS and UP (it's actually big 6 if you include Canada's CP and CN).

Or possibly, the big 4 could have been those 4 guys who started the Central Pacific.

[spankybird]

The Big Four was Clevealnd, Chicago, Cinninati and St. Louis. I am not sure if if became part of B & O. I have it at home.

[cnw1995]

You know, when I first saw this thread - I thought it had to do with the Big Four - what was that line's name - the Chicago, Cinncinati, I can't remember- they were absorbed into the NYC, no?

[palallin]

QUOTE: Originally posted by emmaandy



Look what happend to O scale since the 50's it dropped and dropped and now it is hard to find detail and scratchbuilding parts. The things that are available mostly are three rail converts. There has been a bit of a rebirth based on the desire for scale 3 rail but it is not like the days when Walthers made O scale car kits.

2 rail O scale is in better shape now tha it has been for decades, possibly forever. Kits abound, though more are in plastic than wood, and RTR is awash in new diesels (I will grant you that the steam situation isn't quite as good as it was in the '70s). Track, electronics, and bulding kits are all over the place. In fact, I'd say that, as the 3-rail market shakes out, many of those scale-oriented folks are going to make the plunge into 2-rail scale. What companies like Atlas are doing are sure encouraging that trend.

I'm going about halfway, myself. My new layout will accomodate both, and I am just about done purchasing in 3 rail. I need to fill in a few pieces, but most of my future buying is trending toward 2 rail. I am frankly sick and tired of what passes for 3-rail manufacturing today.

It may seem strange, but I much prefer MPC days to the "horse power" wars today. If I can't have what I want from whom I want it, I'll start looking elsewhere. All model railroading is a series of compromises, and I'm adjusting the kinds of compromises I want to live with.

[Jumijo]

I agree with you 100%, David. MTH Railking boxcars sell for ~ $35.00 a pop. Lionel's are ~ $25.00. No way on Earth do either of those cost more than $5.00 to produce. I guess the thinking toward the hobbyist is "if they want to play, they have to pay".

Jim

[FJ and G]

Toy train companies don't release their profit statements. However, I think that they all are charging too much $$$ and not just on those 1K++++ locomotives. Even the so called bargain items.

Not to pick on K-line but their $99 Porter is considered a real bargain.

Well, I'm reading my latest Garden RR magazine (Oct05) and on page 33, there are Porters for $78 and those are much more massive than the 3-rail variety and Heislers for $349.

[Jumijo]

The high end stuff is here to stay. But how much of it we see in the future is any one's guess. I think there is a trend in the industry towards the entry level, less expensive products. I think it's slowly dawning on the powers that be that there are more low-end users than high end. The high-end stuff might have a higher per-unit profit margin, but it isn't selling. Blowout sales illustrate that fact clearly.

Jim

[Anonymous]

I agree with every point you made, Brian. And I imagine that the records (if they were available) would show that the kinds of toy trains you, I, and many others perfer still account for the largest sales volume and they are certainly the trains that bring new faces to the hobby.

But so much of the manufacturers' resources are being devoted to catering to the high-end crowd--where the largest profits-per-item are being made--that I'm afraid the more modest traditional lines are being somewhat neglected. Not in all cases, of course, but to the extent that little real focus--especially marketing emphasis--is being given to those more traditional toy trains. The trains are there in some number, but who, outside of those of us actively immersed in the hobby, hears about or sees them?

The end result, of course, is that the overall market will continue to shrink as novices shy away from what they preceive as a too-costly hobby devoted to intricate, high-end items that are beyond not only their means, but also beyond their level of interest.

[hugoroundhouse]

I don't care qbout the Big Four as long as Gilbert keeps producing those Postwar Flyer beauties right here in the good ol' USA.!! Oh, wait a minute.....

Jim E.

[brianel027]

Not all of us demanded more scale detail, more realism, more elaborate electronic digital control systyems. Less is more, and simplier is better. Watercolor paintings can be every bit as good as a beautiful photograph. But no expects a watercolor artist to actually paint the sky... he/she gives an "impression" or "representation" of it.

Just like art, the "representational" train products may not have appeal to everyone, but they still have beauty.

Well, at least speaking for myself. I would have been long happy had the train companies recognized that modern road names on beginner products creates a connection between the "toy" and the real thing. I'd been happy had the K-Line S-2 stayed in production with some contemporary roadnames. And as much as I would have liked to see at least one other new "027" car tooled up in the past 15 years, I do really like the Lionel Waffle Box Car and it is my favorite box car of anyones.

Well, MTH may still have the biggest catalogs. But they also have the longest yearly list of cancellations. And despite improvements, reports are that they still have a problem getting products out even closely to being on announced time.

And I fully expect the vast majority of these model trains to never again have the financial collectible values they once did. In any collector market, there needs to be a broad general knowledge and appreciation of the products. The train companies have blown their best opportunity for long term growth for the train market with youth in favor of catering to the short term adult market. The high prices commanded by trains were driven by a vast appreciation of the product, buyers with disposable income, and a desire to own premium condition train. Lionel trains during the 1940's - 1950's were made and sold in the millions. Despite today's improved variety in products, production runs are smaller and the trains have far far less public visability than they did in the past.

I don't see how trains can possibly have the values in the future that nearly all did during the 1980's early 1990's when even Lionel MPC box cars very typically went for $40-$60 or more. Put that price on one of those box cars on eBay as a reserve and see what happens.