Model Manufacturers' Tariff Announcements

I've been in the hobby long enough to know what things were like before the 1990s, when almost all the rail hobby manufacturers moved production to China. I never thought this was a wise decision, and the manufacturers were effectively put on notice that they were giving a hostage to fortune in 2018, when a major factory producing model railroad items closed:

InterMountain Railway Co., Atlas Model Railroad Co., Bowser and Fox Valley Models announced this week that some new locomotives and rolling stock will be delayed or canceled because of the unexpected closing of one of the industry’s top manufacturers. Creating their own manufacturing factory with the implementation of plant networks they could have possibly avoided this situation.

None of the companies said what products will be delayed.

Other manufacturers, including Trainworx and ExactRail, also are affected.

At least one manufacturer confirmed that Hong Kong-based Affa Technologies, Ltd. closed. The company, founded in 1996, specializes in metal parts for toys, scale trains, scale cars and metal electronic products, according to the company’s website. The website made no mention of the closing.

The report here suggested that the companies hadn't planned adequately for this sort of contingency in 2018, and the situation this year with the tariff war simply confirms that nothing has changed. The bottom line is that all but a handful of hobby producers had surrendered control of their supply chain and production to factories in a country that wasn't aligned with US interests, and this led to a range of risks that none of these companies adequately addressed.

The companies have been slow to recognize their problem publicly. The first seems to have been Walthers. Stacey Walthers Naffah, CEO, gave an interview to David Popp of Model Railroader on April 21. I want to stress that her public bio indicates that she is a graduate of Boston College as well as Northwestern's Kellogg Graduate School of Management, which means that she should have been far more aware of the risks to her business's continuity than she appears to have been. And for now, she still doesn't have much of a plan:

Stacey: . . . Many product categories are heavily reliant on China and Southeast Asia. They have the skill set, they have the supply chain, and they have the team members that they’ve developed in some cases over 30 years or more.

David: I think a lot of people fail to pick up on the fact that the system that’s in place; these factories that make all of the specialized parts for locomotives and put all the little grab irons and everything else on we modelers love, they didn’t happen overnight. It’s taken that industry [model trains] a long time to spool up to make those products and get them to the level we see and enjoy them today.

Yes, it did take 25 or 30 years, and people like Ms Walthers Naffah with MBAs let it happen, even with the 2018 wake-up call. Ms Walthers Naffah is lucky she can't fire herself from the family business, because she'd be fired by the board of any other. But what's the plan now?

Stacey: This has been a really interesting leadership and management challenge for me and for my team and for a lot of the businesses in the industry. We’ve been talking to each other to help advocate for our position and explain it. But, yes, everybody’s really trying to figure out what to do.

. . . So yes, there’s a lot of pausing, regrouping, figuring out what’s the right thing. Our suppliers have made this product. We need to pay them. We’re always going to be a good partner to them. They’ve been a good partner to us. And so, there’s a lot of decision making that has to happen to figure out how to get us from where we were three weeks ago to where we’re going to be.

So basically tbere's no plan. They're just going to have to figure it out. Manufacturers are slowly announcing that they can't guarantee prices on pre-orders, but that's not any sort of solution to the basic problem. Athearn announced this past week on Facebook:

Due to the China import tariff increasing to 145% and ongoing uncertainty about future rates, the Athearn team is currently unable to confirm pre-order pricing with confidence. As a result, we have made the difficult decision to postpone all new product announcements, including the May release originally scheduled for Friday, April 25th.

We understand this may be disappointing, but believe this pause is the most prudent course of action under the circumstances.

Atlas basically announced rhe same thing in different words:

Atlas Model Railroad Co. has announced the roll out of a new Price Lock program, effective through May 31, 2025, as a response to market uncertainty brought on by the rollout of U.S. tariffs.

“We know our partners are navigating a rapidly changing market. This decision is about providing them time, clarity, and trust,” said Jarrett Haedrich, Executive Chairman of Atlas, in a press release shared with Model Railroader. “All of our in-stock inventory — plus our most recent container arrivals subject to the new 20% tariff — will remain at current pricing through the end of May.”

. . . This program applies to in-stock N, HO, O, and Z scale products. After May 31, 2025, Atlas plans to reassess market conditions and adjust their catalog accordingly.

At this point, they're hoping the problem will go away in a matter of weeks, there'll be a tariff level they can live with for now, and life will go on. But this doesn't change the basic problem, that 25 years ago, the industry surrendered control of production to a few factories in China that are still subject to natural disaster, epidemic, economic collapse, regime change, or even war with the US, all of which could have a greater and longer-lasting impacrt than a tariff conflict.

From a consumer point of view, at my age, I've bought 99% of what I'm ever going to get, and my future plans have more to do with disposing of it all. But also, there's a huge supply of "new old stock" train equipment avaiIable on eBay, so hobbyists have that option. I think more of the small-business train stores that are threatened if they don't have products to sell. Somebody with more imagination and initiative than David Popp and Ms Walthers Naffah is going to have to step in.

The Bachmann N Amtrak ALC-42

I was interested in getting the Bachmann N ALC-42 and bypassed the Kato model, which has been out for quite a while, even though even at discount, the Bachmann is three times the price of the Kato model. But in comparison to either the Kato P42 or SC-44, which I do have and which are mechanically and electricslly similar to their ALC-42, I think the Bachmann is worth the money.

For one thing, it's possible to get Kato ALC-42s with DCC and sound installed from a few vendors, but the price is comparable to the Bachmann, but the Katos don't have the Bachmann level of detail, nor the added lighting features of the Bachmanns. (I don't know if the Katos, even with DCC and sound, have the corridor lighting installed, which is standard with the Bachmanns.) There are also numerous detail features like free-standing grab irons that are visible in the photos.

Below are two shots of the Bachmann up and running on my small layout:

The ditch li9ghts are always on with the loco in forward. You can turn the main headlight off and on with F0. The ditch lights will alternately flash when you press F1, the bell, or F2-F3, the long and short horn. In reverse with F0 on, a rear headlight will go on:

In forward, two red rear marker lights illuminate.

In reverse, two red marker lights illuminate at the front of the locomotive.

The loco has a capacitor that lets the sound and motor run for a few seconds after power to the track is switched off.

The ALC-42 has illuminated numberboards on the front that, like the ditch lights and corridor lights, illuminate whenever power is in the track. However, the ditch lights turn off automatically with the headlight in reverse. The DCC and sound decoder is TCS version 5. The loco prime mover sound starts whenever power is applied without the need to address the loco or press a startup key. However, you can mute the prime mover sound with F8. You can also run a prime mover start sequence with F6. F7 dims the headlight.

There are more advanced TCS features that allow you to control the numberboard and ditch lights, along with many other options, in the loco documentation.

So far, I like the sounds that come with the loco a lot, but questions like the volume or the precise horn sound are individual preferences.

More Scenery Work Around The Power Substation

I mentioned in my last post that I wanted to add more small details around the substation a la George Sellios. I had some items on hand. The photo is mainly to check my work and see what else might be done:

I added ductwork to the roof of the building and barrels to the ground surface nearby, both from Model Tech Studios. I also added a Kato catenary bridge, inserted in preinstalled bases.

The roof needs more details like maybe a rooftop water tank and stairway entry. The plywood base holding the background buildings needs to be disguised with either vegetation or a retaining wall.

Woodland Scenics N Power Substation

I installed a Woodland Scenics N power substation, with their N chain link fence kit, on my triple-wide urban-industrial T-TRAK module.

As I get older and my fingers don't work as well, I'm finding Woodland Scenics built-up models an acceptable substitute for kits and scratchbuilding. The other structures in the scene are N scale building flats, some of which have been made more 3-dimensional with foamcore additions.

The building to the left is an abandoned factory from PTF Designs, a low-relief model installed as is. The one to the right is from Trackside Flats with a foamcore additon to make it 3-dimensional. I added fine ground foam "ivy" to the sidewalls to make up for the fact that they don't have detail. The buildings to the rear are plain flats from Trackside Flats.

The photo details on Trackside Flats N scale flats come out with a really good 3D effect for fire escapes, drain pipes, and so forth in photos. I have more N roof details like ducts to add to the 3D building roofs, and it looks like the ground areas can use more barrels, pallets, vehcles, and so forth a la George Sellios.