# THE MTH GRAND PLAN



## TJSmith (Nov 16, 2015)

Well, what better way to improve your sales then to announce you are going shutting down. The new offerings are incredible. Engine, rolling stock and other offerings. Mike is the ultimate.


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## Old_Hobo (Feb 20, 2014)

Let me get my popcorn.....


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## Norton (Nov 5, 2015)

I grew up watching this. Mike is a rookie compared with the old timers. Two page newspaper ads every week for years and windows covered with signs. I think this business model may actually work. Instead of MTH deciding what they are going to produce, its their dealers with input from their customers who are making the calls.

Pete


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## Bryan Moran (Jan 15, 2017)

Would be nice to know the back story. I am a big fan of print catalogs so I can think about my purchases, place the pre orders. 

I did not even know about the Berwyn's Trains special runs until you guys clued me in. I went to their website and there is nothing about them. In tbe long run that is not a business model. And yes, it has a Lucy pulling the football away from Charlie Brown "feel" to it. If you are going to retire, let's get on with it. I want to see what happens post closing. If key employees are behind this, then name the new business venture something else.


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## beachhead2 (Oct 31, 2017)

I'm only disappointed he hasn't announced anything I want yet.


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## neilblumberg (Apr 15, 2019)

I don't think this is a plan. It's making it up as they go along. It's a transition phase. The end game is not known yet, but it involves a company that is a shadow of what it once was with some certainty. You want a transformer, track, buildings, accessories, you clearly are going to have to look elsewhere. Premier steam, Railking locos and rolling stock, little to no likelihood of production. No catalog as someone mentioned. Supplies of parts and TIU/AIU/etc. promised but no names, addresses or other vital information yet despite the move this month to new, smaller quarters by some of the employees. You have to be a wild optimist to think this is good news.


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## Streamliner (Feb 21, 2021)

Why would anyone call Mike Wolf a “huckster?” He tried to sell the company intact, but no takers. So, he decided to break it up and sell off bits and pieces. Can anyone blame him for that? I sold very little MTH when I had my store, mainly because I didn’t like the low dealer margins. That said, I’ve always had the utmost respect for him and his company. In my book, Mike is in the same league as JLC, Harry Ives, A.C. Gilbert, Irv Athearn, etc. Just think what might have happened to the 3-rail hobby if Mike had not come along when he did.


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## beachhead2 (Oct 31, 2017)

Streamliner said:


> Why would anyone call Mike Wolf a “huckster?”


Answer: the Internet!


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## neilblumberg (Apr 15, 2019)

"Just think what might have happened to the 3-rail hobby if Mike had not come along when he did."

Wouldn't have made much difference to those of us who primarily buy Lionel and use TMCC or Legacy.

I think the reason for accusing him of being a huckster is that he said they were closing in May 2021, yet they are making large numbers of special runs that won't be delivered for many months yet. Initially people spent lots of money scarfing up the remaining stock and the used market went a bit crazy since the end was nigh. Now the end isn't so nigh .

Some people feel they were lied to. Personally, makes no difference to me, but some people feel misled. I see the truth will likely be somewhere in the middle. They saw the opportunity to make a little more money, and perhaps their factory balked at a sudden shutdown and wouldn't agree to work with Atlas if they didn't keep making stuff during the interim.

They are almost certainly really closing; it's just going to go on for a while. I will be surprised if a viable DCS/TIU/etc. company really comes out of this, but time will tell. MTH is dead company walking most likely.


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## Streamliner (Feb 21, 2021)

As someone who was a Lionel dealer for years before and years after MTH came to be, I can tell you that it made a WORLD of difference. Mike Wolf gave Lionel a real kick in the *** and intense competition, such as it had never seen during the post WWII years. Before that and since the late 60’s, Lionel produced nothing but absolute garbage. Can we all say MPC? If it had not been for Mike, who’s to say if Samhongsa would have ever gotten into producing 3-rail items. There probably would have never been a Korea Brass. There’s a very good possibility that Richard Kughn may have never bought Lionel, without Mike Wolf stirring things up and showing all the possibilities for the future of the 3-rail business. 

It’s easy to whine now about how Mike is winding things down, but I would bet that a tremendous factor has been the virus over the past 14+ months. Orders were already placed, parts were manufactured, then factory closures, parts shortages, etc., leading to the current situation. Absolutely not Mike’s fault. Cant we give him a grace period at least equal to the time much of the world was shut down, before calling him names? 

Those who love contemporary 3-rail trains, with all the electronic gizmos (I’m not a fan, by the way) have Mike Wolf to thank for them. Without Mike and MTH, Lionel would probably have ceased to exist long ago. 

Hope you are all doing well,

Allen Drucker


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## Lehigh74 (Sep 25, 2015)

I agree with 90% of what you say Allen. The other 10% is because I am a big fan of MTH and DCS.

I put Mike up there with Joshua Lionel Cohen.


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## neilblumberg (Apr 15, 2019)

"There’s a very good possibility that Richard Kughn may have never bought Lionel, without Mike Wolf stirring things up and showing all the possibilities for the future of the 3-rail business."

Well we'll agree to differ overall. I believe Mike Wolf was not a factor at the time Dick Kughn bought Lionel in 1986. And he was not a factor in Dick Kughn and Neil Young developing TMCC and Railsounds (which Mike Wolf badmouthed for about half a decade before realizing he was losing market share due to lack of command capability with PS1). He deserves credit for producing some beautiful trains and contributing to the growth of the hobby, but you and many others give him much too much credit, and people like Dick Kughn, Neil Young, Dick Maddox and others too little. The partial proof for that statement is Lionel is still around and MTH is going to head into the sunset.

And he made lots of mistakes, some quite destructive of the hobby/industry, including his rampant litigious nature. He cost a lot of people their jobs and initiated many lawsuits, some of which ate up money that could have been used for product development and marketing for both Lionel and MTH. And his arch foe, Bob Grubba, developed a terrific company, Broadway Limited, which is producing high quality, reasonably priced HO and N gauge trains and has a succession plan it seems, while MTH had none. 

So it wasn't all butterflies and brilliance. I wouldn't call him a huckster, but he was a serial litigation monger, and a self-promoter well beyond what the facts supported, in my view.

Is the hobby better off for his efforts? Sure. But not beyond criticism.


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## bigdodgetrain (Jun 12, 2015)

cabin fever auctions has posted the 9th mth auction with 601 more items closing may 19th


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## Old_Hobo (Feb 20, 2014)

Tell me what model train manufacturer has been beyond criticism......it’ll be a real short list......


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## superwarp1 (Dec 13, 2016)

First off, no one knows what Mike is thinking, or what his plans are/were. All we have are rumors. And for the term Huckster, well you don’t get to be as successful as Mike Wolf by being a saint


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## Bryan Moran (Jan 15, 2017)

I did not mean to imply I agree with the 'huckster" moniker either, just that there may be a lack of transparency. With both MTH and Lionel there seems to be a quiet culture, not a lot of news gets out. I like transparency and respect companies that employ it. 

Not understanding some of the backstory above I did go and read the MTH wikipedia content. Obviously you old timers know the story better then us who recently (last 8 years) joined the hobby. 

As a realism guy I may not have even entered the hobby if the trains did not exude realism. MTH helped that tremendously in my opinion. 

It was an interesting read. At their height it said on wiki (not all things are true) that MTH was making $50 to $60 million a year and that was a few years ago with lower prices. 140 employees or so, that's decent size. Mike made his money and he wants to retire. 

The comment about Lionel isn't shutting down so that should tell you something. Really? Apples and oranges. If Lionel was put up for sale, who would the buyer be? The owners would have to open their books, etc. Mike wants to retire and enjoy life. The fact that no one wanted to buy the business lock, stock and barrel in such a specialty industry doesn't mean a lot.


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## davidone (Apr 20, 2015)

MPC was one of the better eras for Lionel. I can't say everything they made was garbage, that is a vast overstatement. 
I collect and run mostly MPC and have since 1970. If not for mpc there would be no Lionel today. 
They made some really nice stuff like the F3's, aluminum passenger cars, good looking semi scale steam engines. 
I can't afford today's Lionel trains and if not for mpc I would not be into trains. 

Yes today's trains are very nice but just not for me. 

Dave


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## Bryan Moran (Jan 15, 2017)

Dave
I understand. It's an arms race now to see who can make the most expensive trains. Very cool, but very expensive.


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## neilblumberg (Apr 15, 2019)

"The fact that no one wanted to buy the business lock, stock and barrel in such a specialty industry doesn't mean a lot."

Well, it means that there is not going to be a functional toy train company known as MTH. If you have tens of thousands of dollars invested in PS2/PS3/DCS locos and WIU/AIU/TIUs that might be a source of uncertainty and concern. The way the new parts department (goodbye Midge) and DCS company are being announced does not provide any confidence. I think MTH fans are in for some very frustrating times ahead. Not so for Lionel fans. Apples and oranges indeed. Reality sucks sometimes.


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## Norton (Nov 5, 2015)

Interesting the various experiences. For myself all frustration for the past dozen years with train companies has been with Lionel. Virtually none with any of the others and I have trains from every three rail outfit. 
If you believe just because Lionel still has a parts department you will be able to get your train repaired think again. Not only are parts for older trains not available but ones made in the last year as well. Lionel won't even service trains out of warranty so hope your repair guy can not only fix trains but fabricate parts as well. Throw in having to reverse engineer the new elctronics because Lionel is not training anyone nor giving out service manuals, and hasn't for that same dozen years. Others have taken it on themselves to do that.

Pete


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## TJSmith (Nov 16, 2015)

Well, I decided to change the title. “Huckster” was not fair.

Anyway, it will be interesting to see what happens over the next year or so with respect to the rest of the company And the DCS spin off. Atlas only bought select portions and licensed the use of DCS.

Is it possible that a buyer was not found not because it was a niche market but rather the company was not profitable.


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## neilblumberg (Apr 15, 2019)

"Is it possible that a buyer was not found not because it was a niche market but rather the company was not profitable."

Sure. But we probably won't know, if so, until someone spills the beans many years from now.


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## Lee Willis (Jan 1, 2014)

That is what I concluded. MTH was probably profitable, but when buying a small business from the founder it is not uncommon to see the buyer figure the business will be less profitable, at least for a while, with the founder/owner now gone. Given everything (model trains are not a growth market, uncertainties about future availability of inexpensive labor from China, etc.) I can see the list of interested buyers being very short . . .


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## Jetguy (Mar 22, 2019)

Breaking news..... M.T.H. 2021 Transition Plans Revealed | MTH ELECTRIC TRAINS
May 18, 2021 - One year after announcing M.T.H. owner Mike Wolf's 2021 retirement plans, the company's evolution is coming into focus with the move from the current Columbia, Maryland facility at the end of May to a smaller location in nearby Elkridge, Maryland. The new location will house two of three smaller spin-offs from M.T.H. Electric Trains including MTH Parts & Sales, LLC. The parts company will feature an all-new parts website with a new online ordering platform slated to go live this Summer. M.T.H. Electric Trains' R&D Division will continue developing DCS and other electronic products on its own in the satellite location it has occupied in Western Michigan for the past 24 years.
The third spin-off, to be managed by a few long-time M.T.H. employees will be operating alongside the parts company in the smaller Elkridge, Maryland facility. The train company will continue to operate as M.T.H. Electric Trains - marketing and producing new model train products - after many discussions with various companies to purchase the entire portfolio of M.T.H. tooling were unsuccessful. The new products will include select RailKing and Premier O gauge models and occasional production of RailKing One Gauge G Scale models.


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## Bryan Moran (Jan 15, 2017)

Well there you go.


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## bigdodgetrain (Jun 12, 2015)

that kind of puts it all to rest.


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## Old_Hobo (Feb 20, 2014)

No more WAGing.....


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## TJSmith (Nov 16, 2015)

I’m not surprise. Why not announce you are going out of business and then sell off your inventory. I guess the “list minute” and ”get them while you can” advertising from TrainWorld and others worked.

Mikey is not going away just taking an emeritus position with regards to the company.


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## neilblumberg (Apr 15, 2019)

A lot remains to be seen as to how this works out. No more warranty service at MTH, only by dealers, for one thing. No Midge in the parts department. Looks like gradual death rather than sudden death to me.


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## TJSmith (Nov 16, 2015)

There was a rumor a few years ago that Tony Lash either loaned some money or invested in MTH but that was never confirmed.

One thing, would you buy something from a company that relies on the dealer to repair it under warranty or refund the purchase price. 

Furthermore, if you were a dealer would you continue to sell MTH products knowing you could be held responsible for warranty work or have to refund the purchase price. Most of their dealers work on slim margins.


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## Old_Hobo (Feb 20, 2014)

Maybe the WAGing will continue then.....


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## Norton (Nov 5, 2015)

AFAIK, John can confirm, MTH has never paid field techs for warranty work. Free parts yes but no reimbursement for time. Out of warranty they can charge whatever the market will bear.
I suspect the few MTH dealers who are having engines made also have capable repair people. Remember few field techs repair to component level. Most just replace parts. That pretty much applies to all brands of trains. At Lionel service school, repairing to component level was actually discouraged as it took too much time. Old school guys like myself and John still continue to do that whenever possible.

Pete


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## Lehigh74 (Sep 25, 2015)

Norton said:


> AFAIK, John can confirm, MTH has never paid field techs for warranty work. Free parts yes but no reimbursement for time. Out of warranty they can charge whatever the market will bear.
> 
> Pete


Bussinger’s (Ambler, PA) used to sell quite a few MTH trains. Charlie Bussinger told me that MTH does not pay for warranty labor. Only parts. He also said that MTH does not pay shipping when they send out new products to the dealers. When Charlie complained to Mike, his reply was that the policy allows MTH trains to be priced lower and that results in more sales for the dealer.


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## Bryan Moran (Jan 15, 2017)

Lehigh74 said:


> Bussinger’s (Ambler, PA) used to sell quite a few MTH trains. Charlie Bussinger told me that MTH does not pay for warranty labor. Only parts. He also said that MTH does not pay shipping when they send out new products to the dealers. When Charlie complained to Mike, his reply was that the policy allows MTH trains to be priced lower and that results in more sales for the dealer.


To be apples to apples, we would need to know what Atlas and Lionel do. In terms of cost to ship. 

Bottom line to me is the O Scale continues to be a poor business model. Slim margins. Hobbyists - like me - continue to want realism in terms of detail and sounds and that costs money. I am in a downward buying model right now, I think I have purchased $35,000 worth of trains, buildings etc in the past 6-7 years. I cringed when I found out about the special run pricing through Berwyn's, $499 each x 2. 

And to me, I look at Lionel - they are offering a lot less in each catalog and what they do offer is schmaltzy, like the goofy Disney and cartoon stuff, non realistic box cars with your birthday on the side, and so on. And BTO the name of their game. 

I am happy with my recent MTH catalog items, most Rail King priced in the $369.99 range with PS 3.0.


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## neilblumberg (Apr 15, 2019)

"And to me, I look at Lionel - they are offering a lot less in each catalog and what they do offer is schmaltzy, like the goofy Disney and cartoon stuff, non realistic box cars with your birthday on the side, and so on. And BTO the name of their game."

We must be looking at different catalogs . I see LionChief sets for less than the price of a PS3 RailKing diesel. I see separate sale LC and LC+ locos at $200-300 street price (that's starting to increase with LC +2.0). I see traditional rolling stock at prices a bit more than MTH. The high end BTO stuff is the first few dozen pages, but a minority of the catalog, and usually is not on my radar. I like the AREA 51 set with alien sounds. About $100 less than any MTH set, assuming you could find one. And the MTH set doesn't come with a controller. You need to provide your own smart phone or tablet. Convenient. Not. Different strokes for different folks.


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## Millstonemike (Aug 9, 2018)

neilblumberg said:


> "And to me, I look at Lionel - they are offering a lot less in each catalog and what they do offer is schmaltzy, like the goofy Disney and cartoon stuff, non realistic box cars with your birthday on the side, and so on. And BTO the name of their game." ...
> 
> ... I like the AREA 51 set with alien sounds ...


They're targeting two different markets. Disney, custom photo cars, etc. are targeted at the mass market. The high-end models (Vision, Legacy, etc) are targeting gents that have gravitated to more realistic (e.g, scale) and feature rich models. O-scale trains are a very small niche market. Compare them to video games offered by public companies worth billions of dollars. To each his own. I focus on prewar tinplate. So I have no need for full feature sets. I also wouldn't be interested in "alien" scenery.


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## Bryan Moran (Jan 15, 2017)

neilblumberg said:


> "And to me, I look at Lionel - they are offering a lot less in each catalog and what they do offer is schmaltzy, like the goofy Disney and cartoon stuff, non realistic box cars with your birthday on the side, and so on. And BTO the name of their game."
> 
> We must be looking at different catalogs . I see LionChief sets for less than the price of a PS3 RailKing diesel. I see separate sale LC and LC+ locos at $200-300 street price (that's starting to increase with LC +2.0). I see traditional rolling stock at prices a bit more than MTH. The high end BTO stuff is the first few dozen pages, but a minority of the catalog, and usually is not on my radar. I like the AREA 51 set with alien sounds. About $100 less than any MTH set, assuming you could find one. And the MTH set doesn't come with a controller. You need to provide your own smart phone or tablet. Convenient. Not. Different strokes for different folks.


The last RTR set I purchased from Lionel - the Norfolk Southern set was $399.99 and was junk. It was Lionchief, and the detail is horrible. I ended up selling all the individual items. I kept the O36 Fastrack as I run Fastrack and will be needing it for my next layout but you are comparing an entire set to one locomotive. 

The Rock Island GP in the last Lionel catalog has less detail than the last GP's in the MTH catalog and MTH went with a never before offered Rock Island paint scheme. Lionel trotted out the same old Rock Island GP paint livery that populates ebay. 

Look Neil, there are MTH guys and Lionel Guys. If you are loyal to Lionel I appreciate that. And I have read some of the back story on Mike and the lawsuits, but agree with other posters that MTH brought us into the detail age. 

I own a beautiful ES44AC Lionel locomotive in Rock Island and it's beautiful and I love running it. I own some other Lionel for sure, but MTH's RailKing line is awesome because you can get Rail King, RailKing Scale or Imperial, all in a "slightly" smaller - by about one inch - locomotive that you can't even tell is smaller on the typical layout. 

In the last catalog Lionel offered 4 or so "Lionchief" locomotives at a reduced price. Meh.


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## TJSmith (Nov 16, 2015)

I ordered and am waiting for delivery of a Lionel Legacy Ten Wheeler in Reading and Northern. $675 with whistle steam. I’m hoping to pair the engine up with some MTH RK Blue Comet passenger cars. So, it’s not pure NJC blue comet it’s my railroad.


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## neilblumberg (Apr 15, 2019)

"If you are loyal to Lionel I appreciate that. "

Not about loyalty but preferences. If RailKing makes you happy, that's terrific. I mostly gave up on MTH locos about the time PS1 was found to be a serious problem for reliability and DCS wasn't exactly predictable either. If you operate in conventional mode, PS3 and DCS are much less of a potential weakness. 

Have plenty of MTH rolling stock. Not a fan of Mike Wolf and certainly not into hero worshiping him in the least. As for what's happening now, I think we all realize it's not a grand plan but scrambling around frantically trying to figure out what to do. I hope their employees wind up in a position to retire or find some work/benefits elsewhere or with the new MTH successors. On the other hand, I'm not optimistic that the DCS company or parts company is going to last very long. And the policy of having dealers responsible for all warranty service on new products seems potentially tenuous and a financial burden, but we will see.


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## TJSmith (Nov 16, 2015)

Lionel paid their service centers $35 for warranty work which barely covered their cost. They did get warranty parts for free, when available, and a 50% discount on non-warranty parts.


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## Bryan Moran (Jan 15, 2017)

I don't know what to think. I do appreciate both sides of the issue. In the grand scheme of things, this is a low margin business and a specialty niche. I have never dabbled in HO, or other scales. MTH has not had a catalog out for some time now. Perhaps, and this is my thinking since nobody has really solid 1st person information - is that they are completing shells in stock to completed trains. 

What happens in another 8 months when they have to ask China to make another run of shells, etc? Somebody has to pay for that and I don't think it will be Mike, so maybe MTH has a long, slow out of business trek vs a sudden end. 

I have never really understood the fascination with DCS, TMCC, Legacy etc. I understand it to a degree on Vision Line steam. But those are $2500 models. 

In conventional with my Z4000, I get train talk, bells, whistles on command. With my Lionel rolling stock I can include a screeching and sound filled box car, or a station sounds passenger car. To me, that pretty cool, all controlled by a paddle on my transformer. I don't get the big deal about needing to do it on my smartphone.


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## gunrunnerjohn (Nov 10, 2010)

Bryan Moran said:


> I have never really understood the fascination with DCS, TMCC, Legacy etc.


I don't understand the fascination with conventional being tethered to your transformer handle, so we're even.


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## Norton (Nov 5, 2015)

Besides being able to trigger more features with a remote, you can run multple trains on the same track. Many have layouts large enough where that is possible. Plus all the remote systems play well together. DCS, TMCC, Legacy, and even Lionchief can run on the same track at the same time.

Pete


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## neilblumberg (Apr 15, 2019)

Different strokes for different folks . Whatever gives you satisfaction and enjoyment is what's right for you. I still use conventional because I have some old tinplate and postwar and no desire to upgrade them at this point. I still prefer the LionChief remotes and universal remote to my phone or tablet, so the lack of DCS remotes in the future has ruled out any interest in PS3 at this point, except for the odd loco that gets displayed.


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## Streamliner (Feb 21, 2021)

Lehigh74 said:


> Bussinger’s (Ambler, PA) used to sell quite a few MTH trains. Charlie Bussinger told me that MTH does not pay for warranty labor. Only parts. He also said that MTH does not pay shipping when they send out new products to the dealers. When Charlie complained to Mike, his reply was that the policy allows MTH trains to be priced lower and that results in more sales for the dealer.


This was always the case with MTH. Their dealer margins were lower than most other manufacturers, their shipping policies were unfriendly to dealers, the warranty work, etc. Many dealers, myself amongst them, loved the MTH products, but refused to go along with what I felt were idiotic dealer policies. I can remember many conversations with MTH executives telling me that my profit margin had to be less, so that their products could be priced lower. Ridiculous!

Of course, Lionel and others followed suit, by cutting the margins on their more deluxe items. It was the ”handwriting on the wall” for me: tighter profit margins, a rapidly aging clientele and very few younger folks getting into the hobby. I really miss my store sometimes, but I know I got out at just the right time in May of 2007. 

Hope you are all doing well,

Allen Drucker


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## neilblumberg (Apr 15, 2019)

Allen, I still have and enjoy your Dept. 56 Lionel Train Store. Allied Trains was a class act, and the market forces that have made brick and mortar hobby shops a labor of love rather than a profitable business are something that no one can change. I suspect places like Charles Ro and Nicholas Smith will survive, and there will be those who love the business enough to do it as a hobby with little profit, but on-line and/or direct to consumer is likely the future. Not that I'm at all original in those views.


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