China factory closed, Atlas/Exactrail/Intermountain/Bowser/Fox Valley

[mdvle]

Atlas has announced they have been informed one of their factories in China has closed, leading to some delays in product production.  Rumours the factory may also have made models for other companies.

 

https://shop.atlasrr.com/b-atlas-rolling-stock-and-locomotive-factory-closure.aspx

Edited July 31, 2018 by mdvle

[woodenhead]

Sort of under discussion http://www.rmweb.co.uk/community/index.php?/topic/136105-rumor-on-us-groupsio-that-Hornby-moving-production-to-hungary/&do=findComment&comment=3247576

[mdvle]

Bowser Trains used the now closed factory and now has a bunch of product listed as TBA.

[mdvle]

Fox Valley Models has now postponed/cancelled all announced products as they were also using the now closed factory.

 

They, like the others, are indicating it will take a while to try and sort out the problem and move production to a new factory.

[mdvle]

Add Intermountain and Exactrail to the list, both of whom exclusively used the now closed factory.

[Mike Boucher]

Here's the official word from Intermountain.

https://www.intermountain-railway.com/

 

I think their "expectation" of four months might be overly optimistic.

From what I'm hearing, one of the BIG issues is that the way this factory (and others in China) worked is that the companies didn't own the molds used to produce the models, the factory did.  And that's going to make it VERY hard to "move production" to a different factory.    This may turn out to be incorrect because there's a lot of rumors flying.  But, if true, this is going to seriously impact not only getting new models made, but re-releasing existing models.

And I'm also hearing that Rapido is NOT affected.

[Craig Watson]

Fox Valley,

 

Good Morning,

 

Over the weekend, news broke that a large supplier of model trains in China has closed its doors. Fox Valley Models has used this factory for a large portion of our products. As of today, there is no clear path that will resume production in short order, or an easy way to move projects. With this news, we must reluctantly list all previously announced products as Postponed/Cancelled. If projects can be moved, it will take a number of months to do so, and then get a new factory up to speed on our projects will take even more time. We will keep all previously recorded pre-orders on file. If a resolution presents itself over the next few months, we will reconfirm specific projects as they get close (well into next year at best). If this process takes and extended time, it may be best to re-announce each project.

 

This is an unexpected and sudden development. We recently received paint samples for new projects and had the indication that many of our orders were moving forward. We were looking forward to getting back to work after our extended summer trip with our son. Sadly this is not the case. But we will keep moving forward.

 

For now, we still have a good selection of recent N Scale locos and cars available. We have a few projects at another factory that will now be our focus while things get resolved. We started as a small model company before, and will continue on. We sincerely apologize to everyone who was looking forward to announced releases and greatly appreciate your patience and understanding as we move forward through this unexpected interruption. We will share news and new products as they become available. Thank you.

 

Best regards,

 

Matt Gaudynski

[Craig Watson]

Bowser,

 

Bowser has been informed that our supplier has closed

 

the factory. We are working to find other suppliers but it is a long process. All delivery dates are TBA.

 

Any new information will be posted on our web site. Thank you for all the support of our products.

[Craig Watson]

Atlas,

 

"Atlas has received notification from one of our locomotive and rolling stock suppliers that they have closed their factory. (Please note Atlas track and accessories are NOT affected by this delay.) Atlas is currently working with our network of suppliers to transfer the projects to others for completion. This will cause a delay in some previously ordered products. We apologize for this delay, thank you for your continued support, and will update you with more information as it becomes available."

[Craig Watson]

Thankfully Rapido have put the below on their Facebook page,

 

As many of you have heard, a major model train factory in China just closed. This has affected many model train companies in North America and Europe. Thankfully, it has not affected Rapido.

 

Rapido's two factories are still very much in business, and they are expanding to meet the expected influx of new customers. NP boxcars and N scale 8600 coaches are leaving the factory next week, and TurboTrains will follow at the end of August.

[Talltim]

The factory closedi is called Affatech. The owner has reached retirement age and his children don’t want to take over. Quite why the close down wasn’t done in a more orderly manner with notice given and order books closed a few months ago I don’t know.

[Mike Boucher]

Bluford Shops announced they've been affected...
 

Production Announcement.

 

Bluford Shops has also been affected by the closure of a leading rolling stock factory last week. We are working on moving production to different suppliers but this will take some time so previously projected delivery dates are now “To Be Determined.” We will hold on to pre-orders already placed and will confirm them with our dealer and distributor network when production is ready to resume. The situation remains somewhat fluid as of this writing but we’ll do our best to keep you informed of our progress.

News of the factory closure and its effects on various brands have been spreading for a few days. The lateness of our announcement is due to a large shipment of HO and N scale cornfield sets that arrived (from a different factory) on Thursday. We were working through the weekend to get all of the cornfield backorders packed up and sent out to the dealers and distributors. In addition to the cornfields, we have nice selection of N scale hoppers, cabooses and boxcars in stock now. They can be found here: http://bluford-shops.com/bluford_93_011.htm

We thank you for your understanding and support.
Copyright © 2018 Bluford Shops LLC, All rights reserved.

[royaloak]

Here's the official word from Intermountain.

 

https://www.intermountain-railway.com/

 

I think their "expectation" of four months might be overly optimistic.

 

From what I'm hearing, one of the BIG issues is that the way this factory (and others in China) worked is that the companies didn't own the molds used to produce the models, the factory did.  And that's going to make it VERY hard to "move production" to a different factory.    This may turn out to be incorrect because there's a lot of rumors flying.  But, if true, this is going to seriously impact not only getting new models made, but re-releasing existing models.

 

And I'm also hearing that Rapido is NOT affected.

In China it doesnt matter who owns the moulds it is a question of who has possession of them.

[Ian J.]

Just how many 'cheap' factories in China (and elsewhere in the world) are run with a single owner like this one? That seems a mad way to do things with such large undertakings. It would surely be better to have some decent organisation and management in place to ensure continuity and perspective, rather than running like a big one-man-band that could fail at any moment...?

[Talltim]

I’m not sure the factories are large undertakings, there’s plenty of similar privately owned small businesses in the UK

[Allegheny1600]

In Z scale, American Z Line is also affected.

 

http://www.azlforum.com/thread/1273/important-news

 

On page two there is quite a long list of all the companies affected.

Looks like the following companies;

AZL

Atlas
Bowser
Bluford Shops
ESM
Exactrail
Fox Valley
InterMountain
Micro-Trains (N scale FT locomotive only)
Wheels Of Time
Trainworx
 

Bad news all around, I really hope everyone manages to recover from this.

John.

[Oldddudders]

This looks like a market that is going to dry up for a while. Anyone with good contracts is gonna make a bit of money by simply having product available. 

 

We were always told one major US HO model firm employed illegal Mexican immigrants for assembly, dobbing them in if they started asking for a wage increase. I wonder if that will start up again, until Trump stops it?

[alfsboy]

Its how things work  out there .In Japan  model firms  and factories have suddenly shut .Some are bought out ,its all very dog eat dog and take the money and run .They just keep very quiet about it all as honour and face is at stake.

[mdvle]

Just how many 'cheap' factories in China (and elsewhere in the world) are run with a single owner like this one? That seems a mad way to do things with such large undertakings. It would surely be better to have some decent organisation and management in place to ensure continuity and perspective, rather than running like a big one-man-band that could fail at any moment...?

 

It's not so much "cheap" factories as it is these are all generally speaking small businesses.  And like small businesses around the world a large majority of them are private companies owned by a single person.

 

Yes, there are exceptions like Kader - although they aren't just in model trains - but most of the market is served by small companies.

[Regularity]

Just how many 'cheap' factories in China (and elsewhere in the world) are run with a single owner like this one? That seems a mad way to do things with such large undertakings. It would surely be better to have some decent organisation and management in place to ensure continuity and perspective, rather than running like a big one-man-band that could fail at any moment...?

 

In direct response to you, quite possibly very many. It is possibly the best argument in favour of not outsourcing production. Which is how Intermountain, as Pacific Rail Shops, started out - somewhat ironically.

 

 

​Generally (as in an open comment) it is a free, open market. The sort of organisation and management of which you speak would increase the initial costs, and would rely on any legal agreements being enforceable in foreign territories. This is not a criticism of other ways of life, but it is dangerous to assume that "Western" values are the best/highest, particularly when those same "values" are applied variably and adjusted to suit circumstances.

 

Have a look around RMWeb, and it will not take long before you see people bemoaning the costs of items. That despite the massive improvements in fidelity and quality over recent years, against which the "high" prices are an absolute bargain.

This pressure for better models at lower prices means that Western manufacturers cannot afford to pay workers Western wages, and production has to be moved to where it is cheapest. If that is outside the legal/political/commercial sphere of influence of the originating company, then you cannot simply expect to find things exactly the same, except for the costs (and wages!) Add to this the current requirement for high rates of return on capital investment, and few businesses are able to look beyond the next fiscal year (if that) and creating legislation that is watertight (such as escrow agreements over the dies) is very expensive, takes a long time, and quite probably not enforceable. Shifting production abroad is also a sneaky way of hiding the consumption of energy and production of harmful emissions as they are also relocated to the country of production.

 

"Western" Society, which includes most of Europe, North and Central America, Oceania, and parts of Africa, South America and Asia, is built on two basic principles: the payment of debt and the rule of law.

Some other societies are built on other principles, or have additional/stronger principles in addition, for example employing as many people as possible, or that a company belongs to its founder and it is entirely up to him (usually him) how and when he disposes of it. Most will have a strong element of the rule of law, but the law may be very different. Some cultures will have different views on possession, so may not even have the concept of "debt", let alone repaying it. These "non Western" points of view may well be held by a majority of the world's population.

 

This makes relocating production in one of these countries both arrogant (assuming that Western conventions will prevail) and extremely stupid (because they won't). 

The originators of "free market" thinking thought that capitalism would operate within a moral (Christian) framework that operated on the principles of enlightened long-term self-interest, which dictates that (a) you don't exploit your workforce and (b) you don't deplete your natural resources beyond the point of exhaustion.

 

Unfortunately, the unfettered version of capitalism we currently have is concerned with and fuelled by consumption driven by greed and personal acquisition, rather than restraint, moderation and balance. "I want it now. I want it good. I want it cheap. I want more. I want it better. I want it cheaper."

(As an aside, this is why so many Eastern Europeans are working on the land in the East of England: supermarkets want to keep prices down, and the local workforce won't work for the low wages on offer. If you disagree with this, make sure that absolutely everything you have - including the computer you are using to read this - was made in your home country, by people whose grandparents were born there, using as far as is practicable locally sourced raw materials, refined in the same country. You will very soon have a lot of money, but nothing to spend it on.)

 

Viva la revolution? No, just better thinking.

[Mike Boucher]

This looks like a market that is going to dry up for a while. Anyone with good contracts is gonna make a bit of money by simply having product available. 

 

We were always told one major US HO model firm employed illegal Mexican immigrants for assembly, dobbing them in if they started asking for a wage increase. I wonder if that will start up again, until Trump stops it?

 

I have NEVER heard this rumor.

[Talltim]

Also Spring Mills Depot affected

[AMJ]

Last night I was watching a live video on YouTube from TSG Multimedia and the majority of the points brought up were about the closing of the factory. Many were discussing the opportunity to move production into USA or Canada.

 

For the models in America produced by the Chinese I suspect that Trumps tariff will hit these.

[Regularity]

For the models in America produced by the Chinese I suspect that Trumps tariff will hit these.

 

No: https://ustr.gov/sites/default/files/301/2018-0026%20China%20FRN%207-10-2018_0.pdf

Well, not yet... 

[APOLLO]

Globalisation - a race to the bottom for most working folk. Only a very few winners.

 

It'l get worse over the coming years. 

 

Brit15