High Speed Diesel Train (HSDT) - The Story continues

[mdvle]

A 4 wheeled wagon is a VERY different project to the HSDT and a rake of matching MK3 coaches! Even with Rapidos attention to detail the wagon is not going to retail for above £50 is it? - yet a decent representation of the HSDT train could well brake the £1000 mark - and in an uncertain economic environment thats a lot of money to expect folk to be able to spend.

 

IIRC when the HSDT project was paused Jason / Rapido were very clear it was the reaction of the financial markets to the decision to leave the EU which triggered the decision to halt work on the model. Jason setting up a UK subsidiary does nothing to alter the economics relating to the HSDT project although it does presumably provide a suitable firewall to protect his Canadian based business

 

 

The HSDT train was never announced, the only thing announced was the Prototype HST power car.  The UK newsletter #10 says this:

 

 

When I was in Shildon this month, we sat down together and had a detailed look at the finances of the HSDT project. Due to the drop of the value of the pound and its continuing instability, we feel that the Prototype HST model is not financially viable at present.  

 

 

Yes, part of the issue is the repercussions from the Brexit vote, but it is equally valid to point out given all the other projects that have gone ahead in this hobby that the other, unsaid, reason for the pause was that the interest expressed in the model was insufficient to justify the risk to proceeding, that the currency drop just moved a barely viable model into being non-viable.  If the interest was really there then the project would have gone ahead.

 

As for the thoughts of Rapido doing the required coaches to go with the Prototype Power Cars, the price argument doesn't really sound convincing.  Looking elsewhere it is easy to see that people are willing to spend that amount of money - £1000 - when it is a model of something that sufficient people actually want as can be seen by the success of the APT-P model which is at that price point.

 

But what I was really replying to were your claims that Rapido was avoiding the British market due to Brexit, and instead allowing their partners to take all the risk, something that can easily seen to be false given that since the Brexit vote took place Rapido have officially announced (and it is now in production per the latest Rapido factory video) the Guy Arab IV bus, they have shown a 3D print of the gunpowder van, registered a British company not to "protect" themselves but so that they can officially do business in the UK, and have indicated they are already working (hence have spent money on) a diesel model to be announced likely next year.

 

That is a lot of money to have been spent for a company not interested in the UK market.

[JSpencer]

Don't forget that the BREXIT and other incertitude's lead to one Stirling single tender being dropped and the price raised £30. This happened more or less at the same time as when the HST prototype was paused.

[JSpencer]

The HSDT train was never announced, the only thing announced was the Prototype HST power car.  The UK newsletter #10 says this:

.

 

The NRM said at the time they were looking at doing the coaches too. At first Rapido but once Oxfords were announced, it became quite a complex question over who would do them.

 

 

Yes, part of the issue is the repercussions from the Brexit vote, but it is equally valid to point out given all the other projects that have gone ahead in this hobby that the other, unsaid, reason for the pause was that the interest expressed in the model was insufficient to justify the risk to proceeding, that the currency drop just moved a barely viable model into being non-viable.  If the interest was really there then the project would have gone ahead.

 

 

I am interested in this model but the only place I could express this was here. I do not remember anything on the NRMs site to allow me to express an interest so I am not sure how they could accurately measure interest in the item let alone make a decision based on it.

As for the thoughts of Rapido doing the required coaches to go with the Prototype Power Cars, the price argument doesn't really sound convincing.  Looking elsewhere it is easy to see that people are willing to spend that amount of money - £1000 - when it is a model of something that sufficient people actually want as can be seen by the success of the APT-P model which is at that price point.

 

 

 

As for the thoughts of Rapido doing the required coaches to go with the Prototype Power Cars, the price argument doesn't really sound convincing.  Looking elsewhere it is easy to see that people are willing to spend that amount of money - £1000 - when it is a model of something that sufficient people actually want as can be seen by the success of the APT-P model which is at that price point.

 

 

 

DJM has claimed that the APT-P is being done with zero profit though he gets a set of tools which may never be used again but can be used in the accounting books for years to come. I doubt Rapido work on the same business model, a full HST prototype train would be north of £1200 if Rapido did the entire train. They are high end high quality products. The could be sufficient interest of course but its an awful lot to invest in. Lets see 1000 models minimum at £1200 each, we would be looking at 700 to 800K to invest. If a crisis happens somewhere along the line, it is doubtful Rapido would survive the hit - so you can imagine that they are avoiding such risks for now (they are probably investing such sums now, but it is spread across many projects). The NRM on the other hand is probably not prepared to invest so much in one go. With the APT-P, if a big crisis happens, DJM will be finished as a company and the crowdfunders won't get their money back - the level of risk is higher. Comparing the two companies is like comparing the United States Navy with the Imperial Japanease navy in WWII. If the US had lost midway, they could always make good their losses. The Japanease could not and needed to win every battle to win the war. If it could not be won quickly then a disaster was going to happen sooner or later and they were effectively finished from that point onwards.

On the other hand the HST prototype can be done it bit by bit. Locos first, then some coach types followed by other which is what is happening with the single, loco first, coaches later.

[Sir TophamHatt]

... Yet a decent representation of the HSDT train could well brake the £1000 mark - and in an uncertain economic environment thats a lot of money to expect folk to be able to spend.

Why would it cost that much?

Other companies manage to create a variety of locos, wagons, coaches that don't sell for that (combined) price.

 

People throwing up the £1000 mark for train models appear to be guessing at best. Can anyone point to their costings or at least a proper justification on why they think it would cost so much? Saying "a coach would be £75" has no factual evidence, nor is "rising costs in China". As I say, other companies are continuing to produce models fine at the moment.

 

It's about cost and balance.

Produce something that is too expensive and you won't get the orders in.

 

It'll be interesting to see what will make the Bachmann Class 158 worthy of it's £200-£300 price range.

Edited August 31, 2018 by Sir TophamHatt

[woodenhead]

Why would it cost that much?

Other companies manage to create a variety of locos, wagons, coaches that don't sell for that (combined) price.

 

People throwing up the £1000 mark for train models appear to be guessing at best. Can anyone point to their costings or at least a proper justification on why they think it would cost so much? Saying "a coach would be £75" has no factual evidence, nor is "rising costs in China". As I say, other companies are continuing to produce models fine at the moment.

 

It's about cost and balance.

Produce something that is too expensive and you won't get the orders in.

 

It'll be interesting to see what will make the Bachmann Class 158 worthy of it's £200-£300 price range.

If Rapido make a model it is a high spec one, they don't do budget - they tried it, didn't like it.

 

And if you are going to do a limited edition model and attract both players and collectors it needs to be high quality - Hornby don't do Railroad for the collectors market.

[phil-b259]

Why would it cost that much?

Other companies manage to create a variety of locos, wagons, coaches that don't sell for that (combined) price.

 

People throwing up the £1000 mark for train models appear to be guessing at best. Can anyone point to their costings or at least a proper justification on why they think it would cost so much? Saying "a coach would be £75" has no factual evidence, nor is "rising costs in China". As I say, other companies are continuing to produce models fine at the moment.

 

It's about cost and balance.

Produce something that is too expensive and you won't get the orders in.

 

It'll be interesting to see what will make the Bachmann Class 158 worthy of it's £200-£300 price range.

 

You need to remember that Rapido's ethos is "Quality over Quantity" - have a look at some of their products and look out how much separately fitted detail there is even in areas no modeller will ever see unless they display the model upside down for example or take it apart.

 

In other words Rapido products are expensive - and more importantly,thats the way their customer base likes it (witness the way Rapido has swiftly abandoned the idea of introducing a cheaper, lower quality range after significant protests).

 

Figures like £1000 come from the fact the Rapido APT-E sold for £200 (and that was before the big drop in the value if the £ following a certain referendum) and that the latest Bachmann Blue Pullman has a RRP of around £700 for 6 vehicles that are less detailed than Rapido usually make. Of course the longer time goes on, the higher wage costs in China get so as well.....

 

A such a 7 / 8 / 9 car HSDT rake (especially now that the Mk3 tooling costs cannot be shared with the production HST / loco hauled ones due to Oxford Rails attempts making it unviable as an investment for Rapido) is quite likely to end up around that figure.

 

Of course a shorter rake such as 2 power cars and 2 coaches would come in a lot less - but again you need to remember Rapidio don't do trainset style 'mini length' trains to suit 8ft by 6ft setrack ovals - and it would have to be 'an all or nothing' approach to the MK3 trailers. Equally a HSDT power car done to Rapidos very high standards is not going to sell well if all you have got to put behind it is some medicore Oxford Mk3s is it.

[woodenhead]

Of course there is the alternative outcome that the NRM are talking to Oxford Rail about them doing the Prototype HST to go with their coaches and Rapido are no longer involved.

 

Or the Rapido diesel is a HST!

[phil-b259]

Of course there is the alternative outcome that the NRM are talking to Oxford Rail about them doing the Prototype HST to go with their coaches and Rapido are no longer involved.

 

Or the Rapido diesel is a HST!

 

In theory it is of course possible for the NRM to team up with other manufacturers to make a model of the HSDT - though there may be a financial penalty for doing this depending on the legal documents drawn up thus far with Rapido. Its also reasonable to expect that a HSDT produced by Oxford would come out significantly cheaper than a Rapido one - but with a consummate reduction in detailing of course.

 

As for Rapido doing the production HST  - its extremely unlikely given the existence of the Hornby power cars and Oxford coaches. This is exactly why Rapido came in for so much stick over their 'budget' Dash 8 locos (don't be fooled, when Rapido say 'budget' range they are talking about something Hornby would call 'super detailed' such is the level of detailing normally found on Rapido products) - American modellers pointed out that the existence of a mid range product torpedoed any chance of a highly detailed release being made as a large chunk of the prospective purchasers for such a release were no longer interested.

Edited August 31, 2018 by phil-b259

[John ks]

Of course there is the alternative outcome that the NRM are talking to Oxford Rail about them doing the Prototype HST to go with their coaches and Rapido are no longer involved.

 

Or the Rapido diesel is a HST!

 

 

 

My thinking was, isn't the HST a Diesel

 

Thinking wishfully John

[woodenhead]

It has to be said that there is a market for a new Mk3 - now that Scotland and GWR have sliding doors plus the plug doors on Chiltern then to model any of these you need a new moulding - so there is an opportunity to do a new Mk3 - Rapido also do all variations so there are the various types of buffet car that have existed as well.

 

Even though Hornby have had the market for all these years there is no reason why someone couldn't come up with a higher specification version and bolster their position with the latest variations too.

 

That then opens up the HST prototype and production versions from Rapido as an own brand plus an NRM commission.

Listen to me getting all wish listy for something I wont buy.

[JSpencer]

Why would it cost that much?

Other companies manage to create a variety of locos, wagons, coaches that don't sell for that (combined) price.

 

People throwing up the £1000 mark for train models appear to be guessing at best. Can anyone point to their costings or at least a proper justification on why they think it would cost so much? Saying "a coach would be £75" has no factual evidence, nor is "rising costs in China". As I say, other companies are continuing to produce models fine at the moment.

 

It's about cost and balance.

Produce something that is too expensive and you won't get the orders in.

 

It'll be interesting to see what will make the Bachmann Class 158 worthy of it's £200-£300 price range.

 

If produced by Rapido, they will be high end items.

 

Rapido diesels due for release in 2019 typically 225 USD found here: https://rapidotrains.com/ho-alco-mlw-fa2-2nd-us/

 

This equates to £175 per loco at todays prices. Rapido don't do dummy cars and have said in the past that if they did, they would only be 6USD less. If it started today, the HST prototype power cars are going to be at least £200 each.

 

Coaches: 109 USD each, or about £80: right here https://rapidotrains.com/ho-budd-mid-train-domes/

They would doubtless do the entire train. 8 to 10 coaches on this prototype.

 

That equates £400 of power cars and between £640 to £800 for the coaches or £1040 to £1200 for a train.

Edited August 31, 2018 by JSpencer

[mdvle]

Don't forget that the BREXIT and other incertitude's lead to one Stirling single tender being dropped and the price raised £30. This happened more or less at the same time as when the HST prototype was paused.

 

The Stirling Single tender was dropped in a message from Locomotion, first posted on RMweb Nov 28th 2016*.  The reason given for the dropping had nothing to do with Brexit but the rather simple if old fashioned reason that not enough people wanted it.

 

The HST Prototype pausing announcement was January 27 2017.

[JSpencer]

The Stirling Single tender was dropped in a message from Locomotion, first posted on RMweb Nov 28th 2016*.  The reason given for the dropping had nothing to do with Brexit but the rather simple if old fashioned reason that not enough people wanted it.

 

The HST Prototype pausing announcement was January 27 2017.

 

The referendum was 23rd June 2016 leading to a devaluation in the pound and much incertitude after. Agree though orders for the smaller tender were less than expected and maybe overall orders for the single were lower than expected too. But they had to make economies and there were 2 things they did. Drop the smaller tender (saves development cost), increase unit price.

[Vistisen]

Oh - come on !! That's got to be the over-statement of the year !!

 

Both the UK and the EU have too many of their financial interests at stake to allow Brexit to get too far out of hand.

 

We are now at the 'who will blink first' stage - which may indeed continue right up to next Spring's deadline.

 

Even if there is a theoretical No Deal exit, you can be absolutely certain that there are too many vested interests, on both sides, to let a financial situation develop where trade, and more pertinently, profit and dividends, take a dive.

 

Yours cynically,

John Isherwood.

 

There is a difference between blinking and shutting your eyes.

[adb968008]

Oh - come on !! That's got to be the over-statement of the year !!

 

Both the UK and the EU have too many of their financial interests at stake to allow Brexit to get too far out of hand.

 

We are now at the 'who will blink first' stage - which may indeed continue right up to next Spring's deadline.

 

Even if there is a theoretical No Deal exit, you can be absolutely certain that there are too many vested interests, on both sides, to let a financial situation develop where trade, and more pertinently, profit and dividends, take a dive.

 

Yours cynically,

John Isherwood.

Agreed, but can you definitely say where those vested interests and stakes are defined ?

 

Unfortunately no one can,until it’s agreed, so everyone is naturally in a holding pattern right now and have been for 2 years... only fools rush in and all that.

 

I would imagine even in our hobby, that breathes will be held until next year, so i’m not expecting a plethora of new announcements upto mid2019 from any vendor...just the odd thing here or there.

 

However I do agree we are in a “who blinks first” and every extreme positive message will immediately get an extremely negative response from both sides, in the natural way all politicians do business until they all sit down and slap themselves on the back. At which point .. we can see what things looks like for the future.

 

however that doesn’t mean businesses don’t make plans...The world economy has grown considerably in The last few years, and the UK sits behind the pack, this there is a pent up demand that will see the UK as a potential rapid growth market...

 

plans for the best could see a massive bubble of announcements in mid 2019.. plans for the worst.. chances we will never know those plans ever existed.

Edited August 31, 2018 by adb968008

[Neil]

Ah the Brexit factor. I have no privileged insider knowledge of how the rtr manufacturers are planning to deal with this. All the indications so far are that the economy will take a hit when/if we leave the EU and the only variation will be how much damage will be done. In other sectors Brexit is having an undeniable effect on business decisions. Quite how it will pan out for our hobby is open to question. I imagine that the big boys may mange to weather the storm better than the more niche players, though Hornby and Bachmann have complicating factors in their ownership of European ranges. Perhaps this may help spread the risk. Rapido likewise have avoided having all their eggs in the one basket. Looking into my crystal balls, poking about in the dregs of my tea and checking the orientation of the chicken bones I foresee a slowing down in the pace of new releases, a leaning towards less complex, smaller, simpler prototypes which can still be done well but without attracting a premium price. I forecast fewer new releases announced this coming Christmas and next year to avoid exposure to risk. Long term it all depends on how damaged the economy is and therefore how much less the ordinary man or woman in the street has to spend on their hobby. Best case scenario for the hobby? Peoples vote and we remain in the EU.

[Covkid]

Ah the Brexit factor.

Snip

Best case scenario for the hobby? Peoples vote and we remain in the EU.

 

So given the Brexit vote has happened and the pound has nosedived. If there is another vote to debrexit us from , will there be a magical financial recovery and we can all be happy again ? Somehow I think not. 

[cctransuk]

... and the pound has nosedived....

 

Well - against the Euro and some other currencies, perhaps.

 

I have today been checking the Pound Sterling / Dollar Australian; December 2015 - 1.66, September 2018 - 1.75.

 

I'm not complaining!

 

Regards,

John Isherwood.

[G-BOAF]

Well - against the Euro and some other currencies, perhaps.

 

I have today been checking the Pound Sterling / Dollar Australian; December 2015 - 1.66, September 2018 - 1.75.

 

I'm not complaining!

 

Regards,

John Isherwood.

Sorry I don't know what source you are checking for currency conversions (especially as we're not yet in September!), but my info says the following

26 Dec 2015, AUD 2.05/gpb

31 Aug 2018 AUD 1.8/GBP

https://www.xe.com/currencycharts/?from=GBP&to=AUD&view=10Y

 

Not as bad as the low of April 2013 (1.45), but also not exactly robustly back to the c2+AUD/GPB we saw pre 2008. This seemsed to be stabalising back around 2AUD until the June 2016, when the pound fell...

Edited August 31, 2018 by G-BOAF

[Colin_McLeod]

https://www.google.ie/search?q=sterling+Australian+dollar&oq=sterling+Australian+dollar&aqs=chrome..69i57.10652j0j7&client=ms-android-h3g-ie&sourceid=chrome-mobile&ie=UTF-8

[jjb1970]

I blame Brexit for diesels besmirching the hallowed rails of Pendon, it's the barbarians at the gates, the sky is falling in, we're all doomed!!

[cctransuk]

Sorry I don't know what source you are checking for currency conversions (especially as we're not yet in September!), but my info says the following

26 Dec 2015, AUD 2.05/gpb

31 Aug 2018 AUD 1.8/GBP

https://www.xe.com/currencycharts/?from=GBP&to=AUD&view=10Y

 

Not as bad as the low of April 2013 (1.45), but also not exactly robustly back to the c2+AUD/GPB we saw pre 2008. This seemsed to be stabalising back around 2AUD until the June 2016, when the pound fell...

 

Sorry - the first transaction should have read December 2016.

 

Of course, that was post-Leave vote - but I'll still get a better rate now than when I last went Down Under.

 

I wouldn't regard 1.75 as a 'nose-dive' from 2.00; 12.5% is well within the range that I recall Sterling oscillating against European currencies in pre-Euro days.

 

Regards,

John Isherwood.

[phil-b259]

The HSDT train was never announced, the only thing announced was the Prototype HST power car.  The UK newsletter #10 says this:

 

 

Yes, part of the issue is the repercussions from the Brexit vote, but it is equally valid to point out given all the other projects that have gone ahead in this hobby that the other, unsaid, reason for the pause was that the interest expressed in the model was insufficient to justify the risk to proceeding, that the currency drop just moved a barely viable model into being non-viable.  If the interest was really there then the project would have gone ahead.

 

As for the thoughts of Rapido doing the required coaches to go with the Prototype Power Cars, the price argument doesn't really sound convincing.  Looking elsewhere it is easy to see that people are willing to spend that amount of money - £1000 - when it is a model of something that sufficient people actually want as can be seen by the success of the APT-P model which is at that price point.

 

But what I was really replying to were your claims that Rapido was avoiding the British market due to Brexit, and instead allowing their partners to take all the risk, something that can easily seen to be false given that since the Brexit vote took place Rapido have officially announced (and it is now in production per the latest Rapido factory video) the Guy Arab IV bus, they have shown a 3D print of the gunpowder van, registered a British company not to "protect" themselves but so that they can officially do business in the UK, and have indicated they are already working (hence have spent money on) a diesel model to be announced likely next year.

 

That is a lot of money to have been spent for a company not interested in the UK market.

 

That wasn't what I was intending to imply - Jason is a shrewd businessman despite his rather crazy, fun loving persona he projects to modellers and as such I was never of the view that Rapido wasn't serious about building up a British presence for the long term.

 

It was more of a case that any project Rapido might take on has to be viable against the backdrop of an uncertain future for the economy and the currency markets and that being a small company newly starting out in the 00 sector it is wise to be cautious. In the current economic / financial climate the amount of exposure to potential financial risks associated with an uncertain future for the UK will in theory be even more important than normal. Its also the case that (not just in the model railway sector) if enough of the financial risk is transferred to a 3rd party then it might well make the difference between something happening and it being paused till conditions improve.

 

A 4 wheeled wagon is a fairly safe bet - as would an individual locomotive (assuming a wisely chosen one), but something like the HSDT (which includes the MK3s not just the class 41 power cars) is a project of another magnitude entirely - particularly due to the nature of the HSDT itself (i.e. the prototype running with 6/7 Mk3s not just 2 trailers as was the case with the APT-E).

 

As has been highlighted if a Rapido locomotive typically sells for around £250 then the cost of the complete HSDT setup (the APTE- was released as the complete train remember) will mount up. Would a HSDT (note this is not  the same thing  simply a class 41 power car) sell? Yes of course it would Would it sell well enough to make Rapido a decent profit if the economy stagnates / peoples incomes get squeezed, the currency markets become even more unfavourable to imports? Maybe not - and in fact it could turn into a rather large loss.

 

* A note to leave supporters - please observe the use of the word 'if'. This two letter word does not mean the same thing as 'will' but equally it does not mean 'won't' and understand that you cannot guarantee everything will be hunky dory come April 2019 whatever Messrs Mog, Johnson etc say.

[adb968008]

What catches my eyes and ears in the recent video, is the awareness of the hobby and the wider pursuit of preservation hobbies is definitely there, however I didn’t see understanding of the financial differences between North America and UK markets.

 

UK preservation survives on a shoe string with volunteers, who have a higher tax / lower disposable income than the average modeller has in North America, Sponsorships In the UK are much less, and preservation in the UK is generally is charity rather than “for profit” than the other continent. Even the restoration of their Edmunston car, in its recent video was a commercial cost.. I didn’t see anyone volunteering to help them restore it in their video ?

 

Back at hobby level, it brings bigger discounts on the high street as those following their hobby also faces higher prices, on top of tax and lower disposable income to pursue their hobby as well as the above. Selling commissions by the pallet is one thing, supporting a highly competitive retail network at higher end pricing, is something I’ve not yet seen in the hobby, but I’ve seen several North American companies lose their shirt on British investments in other industries, in belief that the UK market is more willing to adopt the kinds of pricing, volumes and profit margins they are accustomed to in North America, and at least in the case of modern traction, is limited in prototypes worthy of yet further duplication.

 

They might be Brexit ready in their business plan, but I hope they understand the financials of the British railway modeller.

Edited September 1, 2018 by adb968008

[Sir TophamHatt]

This equates to £175 per loco at todays prices. If it started today, the HST prototype power cars are going to be at least £200 each.

Hm. So from £175 to £200... at a guess.

Yes, it might be "likely" and I appreciate your references but it's difficult to compare the HSDT with something else.

 

They say it's "paused" but if they aren't going to make it now, they never will as others have stated, prices are constantly rising.

 

They would doubtless do the entire train. 8 to 10 coaches on this prototype.

Didn't someone else say they ONLY put forward the idea of the loco, not the coaches? If they were convinced they were going to do the whole train, why not announce everything?

 

That equates £400 of power cars and between £640 to £800 for the coaches or £1040 to £1200 for a train.

But it wouldn't equate to £400 worth of power cars...

I guess the £175 for the other loco is for a singular loco? Why would Rapido sell singluar locos when it's obvious you'd be running them as a set.

 

I understand Rapido sell fully detailled sets but I doubt they could get something more detailled than what Hornby has produced recently or the likes of Dapol and their 68.

 

I also get that you seem to be very protective of Rapido, but surely even you can see there is more to this than blaming it on rising costs. Because remember, we're talking about a single loco (which is all they announced). On that basis, I don't expect any further products from Rapido... due to rising costs.

 

The pound was 1.36 prior to the referendum (I think?). Today it's 1.29, not a massive difference really. Granted in February of 2016 it was 1.43, but that's currency and it was falling before the vote.

 

Sorry, but I simply can't accept the relative small changes in our currency are the primary reason the loco has been cancelled.