By Noel Widdifield

Author  Bio Has MTH has sold off it molds and exited the Large Scale market? That's the rumor. I visit with Andy Edleman, Vice President for Marketing with MTH Electric Trains and talk about Large Scale or "Gauge One" as it is called by MTH.

This article contains photos taken at the MTH facility in Columbia, Maryland. There are a few RailKing One products, but most are of products in other scales.

In order to find out the truth about this rumor, Jon suggested that I visit with Andy Edleman, Vice President for Marketing with MTH Electric Trains. So I did and will share with you what I found out.

MTH Electric Trains is named for the founder, Mike Wolf, and the initials MTH stand for Mike's Train House. Mike started in the train business at age 12, assembling and selling trains for Williams Electric Trains. By 1980, he was operating a mail order business out of his parents' home, selling trains and parts.

Mike bought the Williams tooling for Lionel Standard Gauge and some "O" gauge reproductions and began to build those products and market them on his own. Over the next several years the MTH line grew and, after some difficulty with Lionel, MTH entered the market directly in 1993. MTH began the production of Large Scale trains with the introduction of 1/32 scale products in 2002.

MTH is located in Columbia, Maryland about an hour away from my home. So it was very easy for me to set up a meeting with Andy and drive up for an interview. Andy was very happy to talk with me about MTH, their product line of 1/32 Large Scale products and their future plans for that line.

We talked about many things that day, but I will focus on the parts of the interview where we discussed Large Scale or Gauge One as it is called by MTH.

Andy went to high school with owner Mike Wolf and he explained that all of the key people but one at MTH either went to high school with Mike or knew him as he was growing up. Before he went to college, Andy worked in the summer for Mike. He graduated from the University of Maryland with a degree in journalism and marketing.

After graduation he was hired by Williams Electric Trains to run the company. After doing that for a while, he eventually joined Mike who had started MTH and has been with him ever since. Andy enjoys trains but does not have a train layout at home. He says that the only time he gets to play with trains is at the train shows where he can run the display layouts.

"Well we have been asked that a few times before. I am not sure that if we went back and did it over again, that we would have decided on the 1/32. It would probably have been a coin flip again. But essentially, we wanted to establish ourselves as a manufacturer in the market by doing it in the proper scale rather than oversizing it as had been done by the other manufacturers. That was the issue."

"That scale has been fairly well received, actually. It has done well. We never expected it to replace our O gauge business. It is not a big enough market to do that. But it is a good niche market and good to be in like our Tinplate trains and probably like our S gauge will be. It added to our portfolio, if you will. And in most cases our products distinguished themselves from our competitors because of the technology that we provide. We weren't overly concerned about the difference in scale from the other manufacturers. People who have put the two scales together have used a transition car to diminish the scale difference. Using a flat or gondola seems to be the trick. It really came down to that we wanted to do it the correct way."

On the one hand a lot of your product in Large Scale appear to be very scale oriented but you also have some of these more toy like action cars, much like those offered by Lionel. What was the thinking there?

"Our thinking was that action cars are fun. We could have made our product line perfectly scale and rivet oriented, but you are not going to attract anyone new into your product line if you do it that way all of the time. So the purpose of a flat car with a helicopter on it, or an operating dump car or log car, is getting more people into the hobby. They attract peoples' attention. We do a lot of shows and we will see a half million people at these shows in the course of a year. Many of the people that come to the shows don't know a lot about trains. What they see with our products is that this looks fun. So at the shows, if we park the helicopter car on a siding and the helicopter takes off, that attracts peoples' attention. That looks really cool to them. So any of these action cars are fun for these people. It is not just watching the train go around. So without the action cars you are never going to attract young people to the hobby. They are used to a lot of action."

"The secret to being in a business is not just play to your core market, but to try to attract new customers to your market. You should always be looking ahead and try to see where you want to be 15 to 20 years down the road. So you have to be building that part of the market by introducing new products that play to that part of the market. That is why we go to all of the shows. We want people to walk away saying, 'Hey, that looks like fun.' We have done that with operating cars in O scale over the years and it works."

You talk about shows and I go to a lot of the Large Scale shows and have noticed your absence at those shows over the last year and a half. Can you talk about that?

"Well, it boils down to resources and manpower and the viability of the show to introduce us to new people. It is important to 'preach to the choir', but it costs a lot of money to do that and there are lot of other places for us to reach those already in the hobby. So when we spend money to go to shows, we want to expose our products to as many people as possible. We typically do the big shows that expose us to people interested in all of the different scales. And if you look at the convention shows, we don't really go to them in any scale, except for the NMRA National Train Show."

"A lot of money is spent on the promotion of that show to bring the public into the event. So the worst that can happen at one of these shows is that the person sees all of the neat operating features of our products and just goes home and talks to their friends and co-workers about what they saw at the show. So they spread the word. The best that can happen is that they buy something. We win both ways."

I have noticed that the dealers for your Large Scale products seem to be disappearing. I know you sell direct, but what is going on there?

"Well the big problem in our industry and it is a problem with the entire hobby industry in general, is that the number of hobby shops is declining. So manufacturers have to be prepared for that. When you have a niche market like Large Scale trains, you have to be prepared to reach your customer in a direct way. We have tried to drive the customer to the dealers who are in business, but the dealers can't afford to stock products in this niche market. They just can't do it. It is up to the manufacturer to be sure that the customer can learn as much as possible about their products. So you do a lot of product videos, etc., on line, because the customers are not going to walk into most hobby shops and see the products."

"The number of hobby shops has declined by a least a third over the past decade. The owners of the ones that remain are growing older and those owners find it difficult to solicit anyone, whether it be a family member or a prospective buyer interested in continuing the shop after they retire or are gone. It's a shame, really, because the hobby shop experience is the best way to demonstrate the product and interact with the customer. But as hobby shops disappear, manufactures have to develop new ways to interact with consumers and online is the most efficient tool available to us today."

There has been a lot of talk on the Internet websites and chat rooms that MTH is going out of the Large Scale business and even that you have sold your Large Scale molds for your products. Is there any truth to that?

"First of all, we have not sold anything and we are not actively looking to sell anything. Also, no one has inquired about buying our molds. Certainly, we have not been aggressively promoting any new Large Scale items or even any of the production items that are currently in stock. And that stems from a number of factors."

"Number one, we are growing like crazy in HO and the part of the O gauge line that is selling in Europe. Out tinplate production is up as the result of the licensing agreement we have with Lionel. So our focus has been on those products. In addition, we had a large disappointment in the Erie Triplex we introduced. Although it was a niche piece, it did phenomenally well in O gauge. We produced it three times in our Premier line and three times in our RailKing line. We sold it in HO and we are doing it again in HO this summer. So we figured this was a no brainer."

"This worked in the other scales so we figured it would work well in Large Scale. And it didn't. It just didn't seem as exciting for people. One of the big differences between the Large Scale market and HO is that people don't acquire and collect vast numbers of locomotives and cars because they are so BIG in Large Scale."

"You can't assume customers are going to buy because they have to have it, like in the smaller scales. They just don't go crazy like they do in HO and O. So when you get into a niche item like a Triplex that becomes a problem."

"With the GG-1, we expected it to do better than it did."

Why did you come out with a GG-1 when there were already a couple on the market from other manufacturers?

"We were so much less expensive than the others, so our attitude was it was a great price and we were bringing to the table, motorized pantograph operation and other technologically innovative things that others didn't have, so we thought we had it right."

"But if you look at the Dash 8's and the F units, they have all done well. And our rolling stock has done well, so it is live and learn. Unfortunately products are expensive to develop and produce and when they don't perform like you would like them to perform it is hard because you are counting on second, third and forth production runs to make the money. On first runs, you usually don't make much money. People just don't understand the amount of dollars it takes to make a new product."

"So the bottom line is that our focus has been on the other scales and we have had some production capacity issues we have had to deal with and those facilities were also building the Large Scale models. The HO and European O scale die cast steam locomotives are taking up our production capacity and are selling very well."

"All of our production is done overseas. Since about 1983 all production has been done there. We have four production facilities and they are all overseas. Production runs in Large Scale are from 200 to 400 in any paint scheme."

So what can we expect in Large Scale from you in the future?

"Well, I wanted to do a 2012 line in Large Scale, but we purchased S Helper in the S scale line this past Spring, so that took up our resources for the Large Scale line. So it will be a 2013 line that will be sold through dealers and direct. The promotion will be primarily direct purchase, but we will have some dealer discount."

"I expect HO to eventually replace O as our biggest sales leader. HO is just a bigger market. We have been able to introduce into HO and European O features that they haven't seen before. Large Scale will remain a niche market."

"So we will introduce a 2013 line. People are calling us all of the time saying they need Challengers or Big Boys, so we will eventually re-run those as well. We have a smaller steamer design and a modern diesel design we would like to eventually add to our large scale roster. So it is really a matter of setting up that line. It will probably be a two-part thing. It will hinge on how the rest of our issues are resolved over the next few months. Sometime this fall we will probably debut that 2013 Gauge One line."

"We put product lines together very quickly once we decide what the products will be. We use the design info that we have used in the other scales to set up the new products in a target scale. The artwork is set and we can put a catalog together very quickly. When we do a catalog, we do it digitally rather than make up models with all of the different paint schemes."

Will it include any new products?

"If it does, it would be the modern diesel and/or the small steam engine. They have been in the hopper for a number of years so it would be very easy to bring them out once we pull the trigger to move ahead with them. I don't know if there will be anything new in 2013, but new products will eventually be added to our lineup."

Anything else for the Large Scalers?

"A lot of large scalers may not realize that our digital technology in our 2013 locomotives will be much improved over our previous locomotive releases. The 2013 locomotives will be equipped with Proto-Sound 3.0 which we believe is the most robust on-board digital package a large scale locomotive can be equipped with today. Proto-Sound 3.0 allows users to operate our locomotives in conventional analog mode under AC or DC power. Users can also control Proto-Sound 3.0 locomotives in command mode using any DCC controller on the market because Proto-Sound 3.0 contains a DCC decoder, something not found on previous MTH large scale locomotives. And finally, Proto-Sound 3.0 also contains our DCS digital decoder allowing our new locomotives to operate with our DCS Digital Command System, right alongside previous MTH large scale locomotives equipped with Proto-Sound 2.0."

Andy, thank you very much for taking the time to talk with us. I am sure our members on LSOL.com will very much appreciate you spending the effort to tell us that MTH is still and plans to continue to be in the Large Scale trains business.

After finishing the interview, I searched the MTH website for RailKing One products and found the following available for purchase: the Erie Triplex, GG-1, PA's, F-3's, F-7's, passenger cars, freight cars and a few figures. All of the locos and rolling stock are available in limited road names.

MTH Interview

Noel, thank you for the very enlightening interview with MTH. I do have many of their engines and rolling stock and think their quality is very good. One thing I'm hoping for is some kind of upgrade for existing equipment with the older PS2 boards to the PS3. Regards, Paul Torrey

Paul Torrey - 09/07/2012 - 12:17

MTH???

GREAT article and wonderful insight as to what is going on with the MTH line. Thanks for the post...

Gerry Keffer - 09/07/2012 - 13:17

MTH

I have some MTH items and love them... This was a great interview and well worth the time to read thru........ Thank you .... CTK

carl kokes - 09/07/2012 - 13:58

MTH Large Scale

I am so excited to learn that MTH is planning to stay in the large scale/gauge 1 business. I had written them off over a year ago. I have found their items to be of high quality and reasonably priced. I second the earlier comment about hoping for an upgrade of existing equipment with the older PS2 boards to the PS3. I can't wait for a new run of the Big Boy!

Bill Stumph - 09/07/2012 - 14:19

MTH Large Scale

I love MTH engines and I have four of them and that's all I run on my rail road. The remote and sound system is the best. Steve Borakowski

Steve Borakowski - 09/07/2012 - 16:06

MTH

Great interview that was info I really wanted to know. I have the MTH Big Boy and Challenger and would like to buy the Triplex next. I also look forward to the modern diesel's.

Jerry Madsen - 09/07/2012 - 20:53

MTH

I do like the care and quality of the MTH equipment I run, however, the 1/32 scale is a problem because I run outside and Big is Better. I have a Triplex that I could just sit and look at or run for hours. It looks way out of place though if I have any thing else running at the same time. If they need ideas for neew stuff, how about looking at HO pikers and oscars, they trade and sell like crazy. Linicka RR

Tice Leonard - 09/08/2012 - 09:55

MTH Interview

Thanks for a very useful interview. I have 4 MTH Gauge One engines & apart from some engine/tender tether problems I am quite pleased with them. I will look forward to the new sound system. the current PS 2 is very good indeed so any improvements will be welcome.

John Blakeley - 09/17/2012 - 04:15

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