What’s happened to K-line’s advertising in CTT? The last few issues have no “K-line” in the Advertisers Index; previously I can’t remember the last time K-line didn’t own the inside front cover & next page 3.
What happened is that they are in bankruptcy. Advertising is a significant expense (albeit a worthwhile one), but I assume that cutting back a bit on “preaching to the choir” was considered a reasonable reduction in expenditures. As I recall, Lionel also hasn’t been advertising all that much in recent months.
Do we know what items K-line may still deliver? I know there was a proposed settlement then it broke off again (with Lionel). The original settlement was going to allow the alleged infringing technology to be sold until January if I recall right. The reason for my question is that I’ve got an S gauge Plymouth engine on order that was supposed to be delivered 9/30 and I have no idea about it’s status. I don’t even know if it included the supposed purloined technology. I’d sure like to get the engine though. Tom
Actually, they stopped their advertising before any of the legal issues with Lionel came up.
I am new to the O gauge world, but going into bankruptcy should protect K-line and allow them to continue operating. I got their catalog the other day (they mailed it to me gratis from their website) and based on what I can see, they have enough cool stuff that they should be able to make a come back, assuming they were really solvent before.
If you see their latest catalog you would understand that they have very little to sell…certainly nothing worth advertising. Odd-d
I just hope their service group still is sovent, they have a pair of my E-8’s that I would like to get back, preferribly repaired.
I agree with Jim that if this is a bankruptcy to give them leverage in their fight with Lionel, then they ought to be able to provide the service support that you need Roger. Good luck! I just hope that I can get the Milwaukee Road Plymouth engine, although if I don’t I’m not in the same situation as Roger who’s got E-8’s in their possession that are his.
Tom
As I noted earlier, I view K-Line, Lionel, or any of the others advertising in the model railroad press as something akin to preaching to the choir, UNLESS they have something new or different to offer that will attract the already-confirmed train enthusiast. Running somewhat “generic” ads is, in my view, pretty much a waste of money in tight times (and these ARE tight times), and probably only done, if at all, because they want to maintain the “visibility” factor. There’s definitely nothing wrong with that, of course, but when money is tight it’s probably a good idea, from the manufacturer’s perspective, to maximize the mileage that can be gotten from what is probably an already lean marketing and promotions budget.
There is, of course, an important minus side to the equation. Those full-page (often cover page), full-color ads are an important source of revenue for the magazine publishers. In fact, those manufacturer, dealer, and other display ads really pay the bulk of the bills. As someone long involved in the publishing business, I can fully appreciate the importance of having those ads, regardless of their content.
And, as is evidenced by the initial post in this thread, readers pay attention, too. They notice when a major supplier is no longer advertising–promoting itself or its products–and it causes them to pause and wonder what might be going on. That “image” factor certainly shouldn’t be underestimated by a manufacturer.
When the manufacturers don’t advertise, it hurts everyone–the manufacturer itself, the publishers, and the readers.
I agree with Jim that if this is a bankruptcy to give them leverage in their fight with Lionel,
The K-line Bankruptcy filing seemed to support the widely held notion that K-line was in trouble before the Lionel lawsuit. They claimed Millions in debt and only $50,000 in assets. The only leverage I see in their fight with Lionel is making Lionel spend for Lawyers fees and in the end get absolutely nothing.
K-line is currently running a rebate deal up to Jan 31,2006… Which I believe is the end of their fiscal year… This may become a date of significance in the O-Gauge community.
Despite what’s right and wrong, these legal battles are strangling advancements in our hobby. Many great minds in the industry are being wasted by all this. The total damage assesments and legal fees are probably equal to the total annual revenue of the hobby. Lionel for example was on a roll churning out newly tooled exquisitely detailed and decorated diesels and freight cars that only Atlas O compares to. These models were really something to look forward to. This advancement came to almost a screaching halt. Two of the key players in this effort became jobless. It is very sad and I am very dissapointed about this.
I collect and operate N scale as well as O gauge. Atlas, Kato, Microtrains, and Intermountain are the major manufacturers. There is a lot of copy catting and sharing of technology in N scale. There is a lot of parts exchange too. Intermountain buys SD-50 parts from Atlas for their tunnel motors. The DCC operating system is open technology and everyone uses it. You don’t see all these legal battles strangling N scale nor do you see the N scale forums lit up with all the BS that follows.
The O gauge segment of the hobby is slowly drowning in a sea of devisiveness and bitterness, inspired in part by the actions of various manufacturers, but most certainly advanced and perpetuated by hobbyists themselves. Very sad to see, to be sure.
Fortunately, there are other segments of the hobby out there to enjoy in the relaxing and satisfying way that a hobby is meant to be, and fortunately there are a great many hobbyists in all scales, including O, who refuse to allow themselves to be sucked into the messy quagmire that is so painfully evident these days.
I was reading a thread about *** Maddox’s retirement from Atlas on another forum. Following a string of some congratulatory posts–entirely appropriate under the circumstances–some of the baser elements of the hobby turned the whole thing into something of a hateful, spiteful diatribe against the man. Truly a shameful display. I’m just glad that nobody on this forum has felt the need to be so callous, uncaring, and outright thoughtless, and I’m especially glad that the vast majority of those who participate here are generally far more closely aligned with the true spirit, tradition, and simple joy of toy trains.
But the above example–and it is just one example–was presented here simply to demonstrate just how far we have deviated from our roots in recent years. There are, thank goodness, still a great many very good, helpful, and well-mannered people in this hobby–always have been and always will be. It’s just a shame that the public face of model railroading and toy trains, especially as it is so often and openly displayed on-line, is not something we can all be proud of.
Now back to playing with my in-progress holiday layout–O gauge, various manufacturers represented, and all great TOYS!
Allan Miller posted this:
“The O gauge segment of the hobby is slowly drowning in a sea of devisiveness and bitterness, inspired in part by the actions of various manufacturers, but most certainly advanced and perpetuated by hobbyists themselves. Very sad to see, to be sure.”
Allan, you crack me up!!!
The sky is not falling. Sorry to be the bearer of good news…
Didn’t say that the sky is falling. Just stating a personal observation. Look around a bit and see for yourself. See the very real problems in the industry (and not exclusively legal problems)? See anything near the kind of growth that the hobby experienced 10 years ago? See the number of train shops growing? See any concerted effort being made to promote this segment of the hobby? See the community of enthusiasts coming together harmoniously?
Fortunately, as I stated in my previous post, there are a good many people in this hobby who represent the best that any hobby can and should offer. No question about that, and a number of them are right here on this forum. But I doubt that anyone could seriously dispute that, all thing considered, we’re seeing a bit of a downhill slide. And it seems to me that before a problem can be solved, it has to first be acknowledged.
I have to agree with Allan on this. This year’s Lionel, MTH, and K-Line’s offerings look like last year’s offerings. It isn’t what it was like ten years ago when we were blasted with a sea of new products and technology. It’s been quite some time since I’ve seen any break-through technology announced. It seems like the only announcements I’ve seen lately is how John Doe got caught with his hand in the cookie jar and brand X is being sued and filing for bankruptcy protection.
Well surely asking for protection is a way of claiming in court your not making money to justify not paying a legal settlement.But you have to go farther than just that,and they have taken those steps in not placing ad’s.But also I saw in the news that China is forcing it’s so called labor orginizations to pay higher wages,which in turn is going to affect the price it cost to buy your goods from the toy train comanies.Maybe all the train companies will realise the cost of their mistake and return shipping back to the U.S. like Dell computers have.But I told my dad the same thing you mentioned about the void of the K-line ads,and he had also noticed the same.Maybe the economy is hurting the toy makers too.
I can’t imagine that you will ever see the train manufacturers return production to the U.S. We’re well past the “point of no return” in that regard because there’s no way the various firms headquartered here could take that step and still retain profitability. The trend in recent decades was to have the trains made in Japan and Korea. Then production moved to China. When China becomes too costly, for whatever reason, the manufacturers will move elsewhere in the developing world–Southeast Asia, or perhaps even India, or some other country in the Middle East or on the African continent.
As for the U.S. economy: It is supposedly strong and growing at a respectable rate. So we really can’t blame what is happening in the toy train market to what is happening in the overall U.S. economy–at least not yet. That may certainly change in the near future as oil prices continue to rise (I paid $3 a gallon for regular for the first time in my life yesterday) and when the housing market begins to deflate.
My own feeling is that the toy train industry, as it relates to O gauge, simply grew at a rate that could not be sustained by growth in the potential and/or real market for toy/model trains. As hobbyists themselves became increasingly demanding in terms of what they wanted and what they would accept, especially in regard to more costly, higher-end products, the manufacturers bent over backwards trying to accomodate the demands. This created a self-perpetuating scenario of growth and product line expansion that was impossible to sustain and bound to lead to trouble. And that’s where we find ourselves today.
As noted here by Bob Keller and noted by me on a post much earlier, K-Line’s advertised stopped before the legal problems came to a heat. K-Line has been making cutbacks in some areas over the past few years: the toll-free phone number was dropped, the 4 motored Alco A-A’s became 2 motored A-A’s, the die-cast couplers on the Alco’s were dropped, etc.
But I must disagree that the legal battles are strangling advancements in the hobby. With or without the legal problems, this has been a long time coming. Even a couple of the major mail order retailers say the hobby is too expensive and that sales are down significantly. This was happening long before the legal problems heated up.
There was a time when the train companies could invest in new tooling, make new products and then have a significant long production run of those products, thus recouping their investment costs for that new product development. That’s not happening today. Segments of the adult train buying market have become very demanding and picky, and the train companies have been more than willing to “preach to the choir” in the spirit of competition (and spite) to accommodate the adult market.
But like in a card game, if you are doubling your wager with every draw of the cards, sooner or later you’d better win or you are going to lose big time. The train companies have been trying to up the ante with every single catalog release. Train customers have come to expect this. Products and tooling made only a few years ago are now obsolete and outdated on technology and detail levels. Technology introduced 5-10 years ago is now not good enough, and the adult train market is more than willing to let the train companies know it isn’t good enough in no uncertain terms. Look at the original MTH Premiere line. Mike Wolf invested the extra dollars and tooled these products for longevity. They became sub-par in only a few years and have now become the “Scale” Railking line. Need I mention the at one time cutting edge PS-1?
Good observations, Brian! That’s pretty much how I see things, as well, in terms of mistakes made and lessons apparently not learned. There’s certainly little or no danger of the O gauge segment of the hobby evaporating and drying up, but unless things change rather dramatically, you can be pretty darn sure that five years from now it will be a significantly smaller segment of the overall hobby than it is today.
I need to clarify something in my original post on the topic of K-Line and the lack of advertising. I did not mean to imply that K-Line’s recent legal difficulties are solely responsible for the cutbacks in advertising. They are, I expect, most assuredly a contributing factor, but sources inside the industry told me several years ago that K-Line was digging itself into a financial hole, and the overt signs were there for anyone to see. The legal filings showed how deep this hole really is, but I’m also sure the more recent legal wrangling has impacted where they allocate what are quite obviously limited resources.
I remember around three or four years ago or so, K-Line announced they were going gung ho with scale 3 rail at prices well below MTH and Lionel. The prices were attractive and some were incredibly cheap. It seemed to good to be true. I don’t think K-Line understood the true cost of doing business when they ventured in to 3 rail O scale and suffered losses they did not anticipate. As a result, K-Line raised their prices last winter and several dealers and customers got pretty angry over it and resisted.
Lionel’s standard issue traditional sized rolling stock has an MSRP of around $26.00 give or take. There are some higher priced custom runs. Depressed center flats have diecast metal bodies. Yes, the PWC cars are more expensive. But you need to realize there are more labor steps with the old style tooling. It wasn’t designed for today’s automated manufacturing methods either. Lionel field wound motors and magnetraction for example is much more costly to manufacture than can motors and traction tires. Can motors are bought off the shelf and made by the millions for everything from cordless drills to power automotive windows. The PWC sets such as the Wabash F3 set and the recently announced VGN Trainmaster set have been popular and the discount prices are a good value in the eyes of many. There are people who want st