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Reply to "Atlas Factory Shut Down"

This is going way off track. Back to Atlas and production costs.

Look, it’s downright ridiculous to compare some small element like the casting of gear boxes to the design of a locomotive scaled from data, engineered for tight tolerances, incorporating computer technology with fine circuitry, involving numerous suppliers on separate components of varying materials, using fine injection moldings made from specialized tooling, and depending on costly paint masks, all of which has to be assembled, then shipped in marketable packaging and distributed across a large country. They are not in any way the same thing on which to base production cost comparisons between the U.S. and China.

In fact, it’s downright frustrating to hear people make arguments that production can be done here for nearly the same costs, because it shows how incredibly unwilling some people are to acknowledge basic realities and shows that they’d rather make fallacious arguments drawn from pure stubbornness.

Not convinced? Well, then consider this: It wasn’t just American O gauge companies Lionel, Atlas, Weaver, K-Line and MTH that moved locomotive production into China years ago. It was also Germany-based LGB, Great Britain-based Graham Farish and Hornby and other international firms.

Still not convinced? Then consider the numbers. Roughly 70 firms from around the globe in the model train business were booted out of the Kader-owned Sanda Kan production facility in 2010. Seventy! And that wasn’t all of the train firms in Chinese production either at the time. That’s a whole lot of companies supposedly looking for insignificant production cost decreases.

Atlas moved production to improve its profit margin, as did Lionel and others. You could argue Lionel could have improved dealer margins or lowered the MSRP to save the end consumer some money, but greed? Really? Not from a business standpoint.

In the long term, Atlas may regret its decision to move all of its production to China. The deal is getting worse and worse for our train companies. But for decades now, our N, HO and O gauge companies have saved on production costs enough to keep them going. Those who did not adapt, such as European firms Rivarossi, Arnold, Trix, Fleischmann and others, are gone.

That could have been Atlas.

Last edited by Jim R.

OGR Publishing, Inc., 1310 Eastside Centre Ct, Suite 6, Mountain Home, AR 72653
800-980-OGRR (6477)
www.ogaugerr.com

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