I’ve been considering manufacturing model trains in O Scale three-rail. The idea was to make trains that, feature-wise, are comparable to Postwar Lionel but are rather cheaper than the entirety of the market today (how does $50 per loco sound?). The first locomotive would probably be a GP38-2 or similar locomotive, with CP, BNSF, BN, SOO, and similar paint schemes (essentially anything you could reasonably imagine running through ND) available. I’d include a “doorbell buzzer” horn, twin can motors, a three-position reverse board, and a few lighting features (ditch lights, headlights, and the like). Would you buy such a locomotive? Or what features/paint schemes/locomotive types would you prefer? I’m mostly looking to start with locomotives that pop up semi-frequently today but also suit earlier time periods.
Almost all my locos are steamers, and I don’t run diesels often at all, but I really like your idea. I think there is a small market available for the kind of loco you are thinking about. I assume, from what your wrote (and what you didn’t write) that you’re thinking conventional transformer control. Your concept appears to mirror a late-MPC/early-LTI era engine, and they came before any kind of command control.
Some questions:
- Made here or overseas?
- Sheet metal frame or all plastic?
- Injection molded body or are you thinking of delving into 3-D printing?
- Automatic couplers or dummies?
- Any separately applied detail or all molded/printed on?
Give thought to an undecorated version so that folks can paint and letter for other roads, including their own.
I will be surprised if it can be done anywhere near that price…
That sounds like a good idea, but make sure that you have the available resources (spark a partnership with Trains Mag to sell them on the Trains.com store and also make sure you have the time to make them since it will take time to make each individual model (3D printing is the best option since silicone can wear out and break after many uses) that’s my suggestion @Engine_1988
I love the idea though! 
I personally would let you stick the IACR paint scheme on the units (If you want and since its one of my fantasy railroads), but also make sure that you set the pricing at a reasonable price (don’t go too cheap or too expensive like other models) and getting licencing from EMD, GE and other affiliates to make the models and full on sell them without legal troubles
I wish you luck, though O-Scale 3 rail is really nice to work with 
To answer your questions, palallin:
- Yes, conventional control is what I’d include.
- It would likely be made in the US, preferably here in North Dakota.
- I’d probably use a metal frame and metal handrails.
- I considered 3D printing, but I decided that injection molding would be much, much faster (tooling costs are trouble, of course–the question is if I can get a good enough quality 3D printer that is faster than molding).
- The couplers would have to be functional, since I’m a fan of switching.
- Most of the detail would probably be molded onto the shell, but some of it would be separate (a horn would be an example). That’s one advantage of 3D printing: freestanding details.
Since I’m a freelancer myself, I do want to make an undecorated version.
ATLANTIC_CENTRAL My main selling point is supposed to be the price, so if that doesn’t work then I’ll pack up, sell the tooling, and go back into the jewelry business instead.
GabeTehGameh, if I could convince Trains to let me sell them through their store, I would be quite pleased. If you think that enough people would buy locos with your scheme on them, then I’d be interested in doing that. Licensing is a major hassle; only one of the seven or so railroads I contacted months ago has responded!
Thanks for the input, everyone!
The three position reverse board is going to cost you $36-$40 alone wholesale. I can’t see how this idea would be close to viable.
Yes, but making my own board–exactly to my specifications–would cost less than $10.
I don’t think it’s especially possible to produce a decent O gauge locomotive domestically for that price point, definitely not with the quality of a postwar piece. The tooling and labor costs will pose major issues.
You would have to sell an awful lot of locomotives to be able to come out on top, with a price point that low. At one time, RMT sold a locomotive for about $50, known as the ‘Beep’. It was a re-tooled model that had started life as an inexpensive, almost entirely plastic model offered by Kusan. The RMT model was far superior in quality to the Kusan, but still mostly plastic.
Unfortunately, RMT raised the asking price to over $100 not all that long after they were introduced- not 100% sure what the story was. I do not believe they are manufactured in the US.
Anyhow. Point here is, this locomotive was a tiny little thing, originally with a really affordable price, and it wasn’t bad quality wise. But it seems like it was a challenge to make something that cheap, and keep it that cheap. And it was an extremely, extremely simple model, and rather than being completely from scratch they had some locomotive tooling already that they simply modified.
I don’t want to ruin anyone’s fun. Also… I suspect there’s a lot of barriers to producing such an inexpensive O gauge locomotive which aren’t apparent until you have to actually started crunching numbers on how much everything’s going to cost, and how feasible it will be to recoup those costs.
I’m not getting my hopes up that anything’s ever going to be as cheap (and good for the price) as Marx trains were in their day. Lionel’s nice postwar stuff, as we all know, was never remotely inexpensive. For the equivalent of $50 today, you wouldn’t be able to afford any Lionel engine inside or outside of their catalog. The best you could probably do would be a single freight car.
-El
I don’t mean to rain on your parade, but…
Menards is selling a 3 rail diesel for $150 powered $80 dummy. They are currently the cheapest 3 rail manufacturer I know of.
I’d love to see you succeed at $50, but I don’t think you can.
Paul
Tooling–that’s the hard part, but I’m working on it. So far I have the jigs and dies and whatnot for the wheels. Labor is a problem, but I think that I can decrease the cost through (1) per-piece payment (which will encourage faster work) and (2) as much automation as is practical. Yes, there are a lot of barriers (TRADEMARKS! AUGH!) and that’s going to take some time.
Menards also has all sorts of bells and horns in the form of a sound system and wireless control.
One of the nice things about expensive US labor, is that it exists because of efforts to give workers things like a decent livable wage, health insurance, safer workplaces, and so on. All things that I think most people would want from employment.
I don’t think encouraging employees to assemble trains as quickly as possible is going to do you any favors on the quality front. If someone is simply trying to crank out as many as possible, rather than doing a good job, you’re going to have problems.
Also, frankly while we all can remark about how expensive labor is in the US, it’s expensive because working conditions and the treatment of employees in the US is generally much better than it is elsewhere. Wherever labor costs are low, someone is bearing the brunt of that in some way, shape, or form. It’s an unfortunate reality we live with.
I’m not really sure what the point is in manufacturing something in the US if your goal isn’t to avoid running a business that relies on dubiously ethical labor practices.
-El
Bingo! I think that, as far as quality control goes, the main thing is test and inspect everything (that’s where most of the workers will probably be). The hard part with the piece-wage is that I have to find the proper balance between too high (employees don’t see the need to really highball and take too much time) and too low (employees work fast and, as you pointed out, ignore quality). My main point in manufacturing it in the US is that (1) it’s a selling point, (2) I’ll have better control and inspection of the factory, (3) I’ll probably save on shipping, and (4) as you pointed out, I will have no “dubiously ethical labor practices”.
Labor-wise, if you retain a small organization, you can avoid some of the regulatory nightmare that raises costs. I have seen the piles of paperwork that stand in the way of efficient and cost-effective operation for even small outfits.
You’re not talking about producing a loco for $50. You’re talking about retailing a loco for $50. The production cost would be much, much less. And that’s assuming you’re only considering direct sales. If you talking about a $50 price point at retailers, you’re looking at a probably sub-$20 production cost.
There’s development cost, production cost, packaging costs, marketing cost, after-sales service and support costs.
Assuming direct sales, let’s talk about shipping. What would the shipping cost be for one of those locos? Do you need to absorb part of the cost to offer a flat rate or do you think people would be willing to pay full shipping? Oh, and don’t forget sales-tax collection for direct sales.
There’s a reason new companies offering locos and rolling stock use contract manufacturers in China. There’s a reason new companies offering structure kits use laser-cutting. There’s a reason 3D printing has become popular especially for small details that were previously molded or cast.
Well, engineering a model locomotive is pretty simple but takes time. You have the drive motor, the weighting, DCC, the motherboard and sisterboards, lighting, and other necessities, but if you need a tester or someone to experiment, @Engine_1988 I can do that since I do that with some models of my own.
palallin
Absolutely! Bureaucracy (both from the government and within the company itself) is the death of many a company. This is why I dislike politicians sticking their nose into my capitalism!
AEP528
You are correct, that’s my retail price. Most of the sales will be direct. The shipping cost will be set up as full shipping for the customer, but there will be a option to pick it up from the factory for the seven model railroaders in Southwestern ND. What I consider a semi-decent shipping cost at Ebay for an O loco is about $10, and, while I haven’t priced it out, that’s my guess for what it will cost. Also, packaging is about $2 and that includes the box it will be shipping in! Finally, (no offense) the reason that a company would make stuff in China is to take advantage of underpaid labor in a mercantilist and communist country! Oh, dear. I need to keep politics out of this. Anyway…
GabeTehGameh
Sure, if I ever get to that stage… Right now I’m so busy that all I can do is read a few magazines and probe the market as far as Shortline Supply Company work goes.
Alright, now that everyone has had their say (negative or positive), I think that I’m going to slightly re-purpose this to serve as a timeline of the process. Should only be a few years, at this rate. 
What will you call the line of locomotives or the brand name in general? I’m curious 
Shortline Supply Company (abbreviated SSC). I’m horrible at naming things, but it seems alright. The idea behind the name is that since shortlines often seem to be penurious (and since I’m marketing to model railroaders like myself who are also cheapskates), I should name the company after such railroads. I eventually would want to do a line of super-detailed trains; this would probably be called Superior Trains (the first locomotive would be lettered for the Duluth, Missabe, & Iron Range).