AF Berkshires

eBay was hosting a sudden spurt of Flyer Chief Berkshires for sale, and my guess was that the original owners had decided to upgrade to the Legacy version announced for this year and scheduled for delivery in December according to Lionel's shipping schedule. I suspect that there were a great many orders for the Legacy Berkshire. A finely detailed Legacy Berkshire for $500 MSRP was too good to be true, and apparently Lionel realized this some time ago; but, as with the mechanical reefer from a few years back, Lionel didn't think it important enough to notify customers who had ordered them. When the news for 2019 is a rerun of U33Cs reusing the original paint masks and changing only colors for a whopping $600 each, a $500 Legacy steam locomotive was too good a deal even if the orders were substantial.

Lionel should have had enough respect for the S scale community to either: 1) communicate that prices may have to be increased beyond what was advertised in their catalogue because of external influences or even a mistake in accounting, or 2) make some announcement that the production run may have to be cancelled because of lack of orders (if that were actually true). The worst thing they could have done was to announce before the expected delivery that they had cancelled the project months before, without notice. Lionel seems to make the worst choices.

I don't think we'll ever know how many preorders there were.  That's one of those nifty little secrets companies like to keep.

Are tariffs playing into this?  Maybe, but we haven't heard (at least not yet) of cancellations in the 3-rail O Scale line where prices were already much higher.

I'm going to speculate that the Berkshires were simply under-priced and they probably were going sell at a loss.

Looking at the CAD drawings previously posted by Ryan, it was pretty clear that the boiler was no mere modification of the FlyerChief Berk.  As I see it, the boiler and quite possibly the tender were going to need all new tooling, along with possibly some significant changes to the FlyerChief frame, assuming its reuse.  Add in tooling and labor for the added details, also.

FLB 04

FLB 01

This was going to be a Legacy model with detailing level coming close to or exceeding the Y3 and yet it was priced the same as the last run of FlyerChief Northerns, which display far less in detail and complexity.  We all were shocked and overjoyed by the $499.99 MSRP for the Berkshire, along with a couple of "I told you so's" thrown in. 

If Lionel were to announce the price would have to rise by 30%-40% to compensate for whatever, there would likely have been a flood of cancellations, to say nothing of nasty accusations of price gouging.  Realistically, the MSRP for the Berkshire should have been around 800-900 dollars.

As far as comparison's the the cancellation of the 57' mechanical reefers, the reefer cancellation announcement happened the day they were supposed to be delivered.  The Legacy Berks weren't due until December, so the decision to cancel doesn't appear last minute.

So, am I disappointed the Legacy Berk has been canceled?  Yes.  Am I going to worry further about it?  No.

Rusty

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I have communicated with Ryan via email.  His response is below.

While I am disappointed, I can understand the business decision. Let's hope that they can develop a new steam engine soon and have orders meet tooling and production costs.

_________________________________

Bill,

Got your message but don’t have time to return your call today. The Legacy Berk run was cancelled for the reasons outlined to the dealers. Tooling costs came in much higher than anticipated and when spread across the order numbers the cost of production was prohibitive. We’ve looked into other alternatives over the past several months and ultimately had to come to this decision.

Thank you,

Ryan

_________________

Ryan Kunkle

Director of Production

___________________

From: billstrains [mailto:billstrains@aol.com] 
Sent: Thursday, September 27, 2018 12:28 PM
Subject: Re: Berks

 Ryan,

Did the tariff situation cause the price to increase?  If so, have other items been cancelled for the same reason?

Thanks,

Bill

 _______________________

 No. This had nothing to do with tariffs. It is exactly what I said – too much tooling, too little orders.

Ryan Kunkle

Director of Production

 
 

This decision while disappointing was more likely predicated on too low an announced price (as described above) potentially exacerbated by low pre-orders along with a shrinking S market than anything.   Observe -- new box cars for $80 (are you kidding, but more evidence of supply and demand), an EXC condition large motor 313 is valued at $208 in the 2019 Greenberg guide while in 2013 it was $288 (a 28% decrease).  Imagine 5 years from now.  There are simply fewer S-gaugers now than there used to be and fewer still over the course of the foreseeable future.  Combine that with an increasing number of used trains going into the market and less new trains sales potential.  So I'm not surprised.     

David Horn

Francine posted:

Unfortunately, this doesn't bode well for the scale people.  They clammered loudly for scale product and didn't support it enough to bring it to market.  Can't blame the manufacturers for that.

"Scale people" would want locomotives with code 110 wheels, or at least availability of conversion wheels.  Neither of those were promised or on the horizon for the Berkshire.  So, don't go blaming them.  Scale conversions of the Y3 (no longer available) was pretty much a one time deal by an outside third party.  Guys with code 100 track aren't going to buy a locomotive that won't run on their track.

BTW.  Where were all the Flyer people that wanted a Legacy steam locomotive?

What this doesn't bode well for is the possibility of any new Flyer steam from Lionel.

Rusty

Francine posted:

Unfortunately, this doesn't bode well for the scale people.  They clammered loudly for scale product and didn't support it enough to bring it to market.  Can't blame the manufacturers for that.

I don't believe they offered it in a scale version. Hi-rail only.

I wrote Ryan one last question asking if the project would be revisited in the future.  His answer was long, but my feeling was he was saying not likely.  I even suggested the price was low.  It seems they have tried reintroducing a cancelled product and the results have not been good.  

When the FlyerChief Berk came out there were lots of complaints here and other places from guys wanting Legacy and lots of detail the FlyerChief didn't have.  These complaints were loud and persistent.  Lionel gave them the unit they wanted and at a great price.  I wonder if the complainers ordered the Legacy.  I have two of the FlyerChief Berks and I ordered a Legacy unit.

Lionel had two runs from the FlyerChief Berks and my guess is that when a new steam engine comes out again it will be a FlyerChief engine with the Berk's level of detail.

I ordered the Nickel Plate from Charles Ro in early March. When I saw the level of detail planned for the Berkshire, I was almost as excited as when I watched these monsters shake my bones as they stormed through an intersection near my home when I was a kid. Then when the 2019 catalogue appeared with the U33C rerun at $600, my suspicions rose. I still believe someone in accounting messed up with cost calculations, but I would still have kept the order even if the final price rose to $750. Now I have to figure what to buy for my kids to give me this Christmas. It won't be Lionel.

Francine posted:

Unfortunately, this doesn't bode well for the scale people.  They clammered loudly for scale product and didn't support it enough to bring it to market.  Can't blame the manufacturers for that.

A scale version wasn't offered, so there was nothing they could support. Not offering a scale version is part of the problem. Maybe not a large number, but more would have sold if one had been offered.

Francine posted:

Unfortunately, this doesn't bode well for the scale people.  They clammered loudly for scale product and didn't support it enough to bring it to market.  Can't blame the manufacturers for that.

Nope. As has already been mentioned, there wasn't a scale wheel version offered. I ordered one...what a shame it wasn't supported by more S modelers.

Jeff C

richabr posted:

Must have been too many people satisfied with previously purchased Flyerchiefs.

 

Rich

I would agree with that statement. 

The F/C Berk captures the look of the Nickle Plate Berk quite well.  The "Good Enough" rule of thought.  The one I tested ran well and the F/C control system was easy to use and provided control superior to conventional AC.  I'm sure the average person would be satisfied with that.

It also looks pretty good hauling scale-detailed freight cars:

Plus, one of the things that worked against the Legacy model (IMHO,) it was as cataloged using the FlyerChief images, showing no visible differences between Legacy and FlyerChief.

Rusty

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They should have made Legacy to begin with.  I was buying these as well but I also had the Flyer chief versions and it was difficult to own both for many people.  In the future if Lionel wants to maximize sales they need to be smarter.  Come out with the top of the line first then produce the cheaper version. 

 

Rocco

I have 2 Flyer Chief Berks I'm happy with. I have/had a Legacy Berk on order. If I had known Lionel would actually catalog a Legacy Berk, I would have held off on the second FC Berk, and ordered 2 Legacy Berks, at the too good to be true price. Probably just one at $700.

Mike

I didn’t pre-order a Legacy version simply because I had ordered two of the FC Berkshires when they were advertised as having separately applied boiler handrails and other details, then Lionel switched the specs shortly after my order went in and the shop I dealt with wouldn’t refund my deposit if I cancelled, even though at that time, the FC Berkshires were not supposed to be BTO. That’s when I decided I would not pre-order anything made by Lionel ever again.

Fool me once, shame on you...

Bill in FtL

As far as I can tell, the F/C Berks were never cataloged with separately applied handrails. 

While there was a lot of back-and-forth speculation here about the handrails when first announced, none of the catalogs from 2015 (where the separate sale Berks debuted) and later indicate separate handrails on the F/C version.

The no refund policy is the dealer's doing, not Lionel's.  None of the dealers I've dealt with ever required a deposit from me.  Only the brass builders like PBL and River Raisin require deposits due to the extremely low production runs and custom nature of their businesses.

Rusty

Although BTO may seem a valid way forward from Lionel’s perspective, it seems that from a consumer need it is very black or white as if something will get produced or not.

Would it not be of value to both sides if Lionel announced which specific items were short of the minimum production run and announce if they get ‘X’ many additional orders then it can be good to go? A win win for both sides.

It just seems a bit clinical at the moment on how decisions are made to run an item into production and leaves people disappointed.

Ukaflyer posted:

Although BTO may seem a valid way forward from Lionel’s perspective, it seems that from a consumer need it is very black or white as if something will get produced or not.

Would it not be of value to both sides if Lionel announced which specific items were short of the minimum production run and announce if they get ‘X’ many additional orders then it can be good to go? A win win for both sides.

It just seems a bit clinical at the moment on how decisions are made to run an item into production and leaves people disappointed.

The question then becomes how long to keep the order extension open.  A week?  A month?  3-6 months?  A year?  I would guess the Berks were quite a bit more than being a couple of orders short to start production.  It's pretty obvious that not one bit of steel was cut yet for molds, so they wouldn't have shown up this year anyway.  And with the failure of Mega-Tracks, people are probably pretty gun-shy about taking risks at the Circle L Ranch.

Companies cost every product manufactured in design, material and labor out to the fraction of cent and the numbers have to add up to allow for a profit.  Where I worked the anticipated sales of our industrial instruments were part of the calculation for production, and not for just one production run.

I'm going to guess at 500 bucks each MSRP, Lionel was going to have to sell a lot more Legacy Berks than all the FlyerChief Berks combined to approach a profitable number.  Of course, Lionel could've always announced a 200-300 dollar price increase and wait for those complaints to roll in...

I'm also going to guess, the 80-85% of the S market wasn't too excited about the Legacy Berks.  As of this posting, there's absolutely been NO nention about the cancellation on S-Trains Yahoo or S Trains-io.  I don't recall much chatter, if any, over there when the Legacy versions were first announced, either.

Rusty

Rusty,

with regards to how long would you keep an extension open for, I personally would say three months is not unreasonable, especially if the winning line is not far away. 

Lionel could network with dealers to drum up extra orders, create a page on the Lionel website specifically for this so customers can see the the progress of future products and see what the situation is.

It’s just an idea, if you don’t ask, you don’t get.

When I open the Lionel website, Products dropdown, then click on AF there is a prominent Flyerchief promo but no mention of Legacy. It might help if Legacy was added there with a direct link to S gauge Legacy engines like they have for FlyerChief.

Tom

FlyerRich posted:
banjoflyer posted:

Just got off the phone with Charles Ro.

The S gauge Legacy Berkshires are cancelled.

 

They should remove them from their website. You can still order one...

It would be really interesting to know how their order for the Legacy Berks compared with previous AF orders, don't even need numbers, just what they think about the cancellation relative to demand they saw. For example orders were: strong, weak, robust, last one out turn off lights.....

Mike

This news is disappointing but, oh well, this frees up some cash for TMCC upgrades I was holding off on. I actually have more motive power than I need. Thank you Lionel for making this decision for me.

Ray

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Roundhouse Bill


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