Lionel Trains
by David Krell
david@davidkrell.com
Mandy Patinkin shared his passion for Lionel Trains on an episode of Chicago Hope. As Dr. Jeffrey Geiger, Patinkin brought his hobby to millions of viewers. In an interview on Late Late Show with Tom Snyder, Patinkin talks extensively about Lionel and explains his reason for Lionel’s appearance on Chicago Hope.
I wanted to pay them back. They gave me my childhood. I’m not kiddin’.
The conversation sparked because of the mutual enthusiasm shared by Snyder and Patinkin. Snyder hosted the video A Century of Legendary Lionel Trains.
In addition to Snyder and Patinkin, millions of Lionel hobbyists have sustained the hobby for the past one hundred years.
Joshua Lionel Cowen (born Cohen) founded the Lionel Manufacturing Company in New York City on September 5, 1900 at the age of twenty-three. Products soon hit the marketplace.
In 1901, Lionel unveiled its first accessory, the No. 340 suspension bridge.
Cowen’s family helped promote Lionel in the company’ s formative years, a tactic familiar to businessmen and politicians.
In 1907, Cowen’s wife Cecilia gave birth to son Lawrence whose face would become instantly recognizable to Lionel buyers. He was the ‘Lionel boy’ on packaging. Lawrence ultimately headed Lionel as the company president.
Although Aurora probably comes to mind when the phrase ‘slot cars’ is mentioned, Lionel actually produced the first motorized slot cars in 1912 as ‘racing automobiles.’ Lionel reproduced these items towards the end of the 20th century.
As the United States entered World War I, Lionel served the country while also serving its customers’ need for product and its own bottom-line requirements.
In 1917, Lionel contracted with the government to build material needed for the troops, for example, compasses.
In the same year, Lionel gauged the public’s war sentiments and produced an armored train with cannons. Like so many other companies, Lionel repeated its patriotic efforts during World War II.
During the 1920’s, Lionel expanded its operations. It advertised in national publications and Sunday newspapers. In addition, it founded a toolmaking plant, La Precisa, in Naples, Italy. Then, the Depression pounded the country and deeply affected Lionel.
For its first three decades, Lionel was a profitable company. But it was not immune from the Depression. The plummeting economy touched the Standard of the World, Lionel’s descriptive slogan. On May 7, 1934, Lionel went into receivership.
Quick, innovative, and necessary marketing helped keep money-troubled customers in the Lionel fold. Cash flow enjoyed reinvigoration.
In 1934, Lionel sold a Mickey & Minnie Mouse handcar for $1, the first Disney-Lionel train tie-in.
Forty some-odd years later, Lionel reestablished its relationship with the House of Mouse. In the 1970’s, it marketed the Mickey Mouse Express consisting of a dozen boxcars and a caboose.
Cowen et. al. did not sacrifice quality during the tough times. Quite the opposite, actually. Lionel displayed a fierce devotion to provide the public with the best toy train products available. The public responded in kind. Some products of the 1930’s proved so popular that Lionel marketed them for several years after their introduction.
In 1935, Lionel sold the No. 350 Hiawatha, inspired by the Milwaukee Road’s steam locomotive of the same name. Lionel sold Hiawatha for seven straight years.
In 1937, Lionel produced a jewel of the toy train set, the No. 700E New York Central Hudson steam locomotive.
Lionel’s late 1990’s version of its web site, www.lionel.com, mentioned the strategy, appeal, and cost of the product.
This all-time favorite icon of the Lionel Lines represents Lionel’s emergence as one of the world’s premier scale-model builders, though previous to this time, Lionel was viewed simply as a child’s toy. At more than $75 a piece, the Lionel scale Hudson, complete with blueprint-accurate details supplied by the New York Central, is the finest electric train ever built.
WIth the country’s mood in full-swint patriotic fervor during World War II, Lionel joined the fight along with its brethren of the corporate world. In 1942, the government mandated control on material needed for the soldiers, like metal, and Lionel halted production of its trains and accessories.
To keep its train lineage in the public’s mind, Lionel sold a ‘paper train’ for assembly during the holiday season.
When the war ended in 1945, Lionel resumed production. It achieved a milestone the following year -- real smoke in its steam engine trains. This was accomplished by placing a Lionel smoke pellet into the stack of a train with the appropriate mechanism. As the engine went around the track, smoke would rise from the stack.
1950 began the second half of the 20th century and marked the Golden Anniversary of Lionel. For collectors who wanted faster trains 1950, Lionel made available Magne-Traction, an invention to help the trains ‘grip the rails better.’ The slogan was, “More speed, more climb, more pull!’
Ten years later, the New Frontier began. Lionel responded to the mood, events, and influence of the new generation. JFK inspired that generation to become involved in public interest with projects including the Peace Corps. Lionel tapped the attention with a train set geared for the landmark election of 1960. The ‘Campaign Special’ came with campaign stickers for both parties.
Lionel paralleled the Atomic Age with the Atomic Energy Commission security train car complete with machine guns on the roof. The satellite-launching car and the Minuteman missile-launching box car were also available.
As television solidified its place as the mass medium for news, entertainment, and sports, Lionel sold a television train car. A 1950’s television camera turned as the car moved down the track.
A Bronx Zoo giraffe train car featured a giraffe automatically ducking its head when nearing a bridge.
Lionel expanded beyond the toy rails in the 1960’s with other offerings. The Famous Inventors series inspired children to recreate great inventions -- Bell’s telephone, Gutenberg’s printing press, Morse’s telegraph, Edison’s electric light.
During the 1960’s, Lionel lost its founder almost sixty-five years to the day after he founded the company. Joshua Cowen died on September 8, 1965. Four years later, the first of several Lionel buyouts occurred.
General Mills bought Lionel in 1969. Breakfast cereal and toys made formidable combinations. It also made the stuff that marketers’ dreams are made of because of the inherent tie-in possibilities. The competition capitalized on this strategy -- Quaker Oats and Louis Mark & Company, Nabisco and Aurora.
In 1985, Kenner-Parker bought the company, a relationship that ended the following year when real-estate businessman Richard Kughn spearheaded the financing to take over Lionel. In the mid-1990’s, Kughn sold Lionel to Wellspring Associates lock, stock, and boxcar. Singer Neil Young and former Gulf & Western mogul Martin Davis were some of the prinicipals.
A press release dated September 29, 1995 heralded the transition with promise, optimism, and ambition.
Greg Feldman, Managing Partner of Wellspring, said,
The acquisition of Lionel -- a true American icon with tremendous brand equity -- is an outstanding opportunity for Wellspring. The company is highly profitable with a large and loyal customer base throughout the country, yet it has the potential to generate even greater returns in both the U.S. and abroad.
We look forward to capitalizing on the company’s strengths while incorporating exciting new technology, marketing techniques, and distribution systems to take Lionel to a higher level.
Feldman’s vision presented a difficult task, indeed, partially because of the high standard Lionel has set throughout its history. This can create a ‘catch-22’for companies. They set the quality bar so high, that matching or surpassing it becomes formidable, to say the least.
So, did the corporate engineers at Lionel believe that the Lionel name’s good will makes conducting new business and selling new products easy because of name recognition or difficult because of a name that the product must live up to? Lionel President Gary Moreau addressed the issue in a 1998 interview with this article’s writer.
Both. Our products must meet the toughest standard of all -- the standard of memory. But when we meet that standard, which we do most of the time, we complete a magical circle of pride and enjoyment.
Although Lionel has tremendous name recognition, it historically does not present a ‘full steam ahead’ marketing approach. Rather, Lionel lets the product speak for itself. Moreau expressed confidence in the product rather than a marketing campaign.
People know who we are. We just have to let them know that we’re still alive and well. We use media, to an extent. But we prefer to put out trains in front of people, to let them experience the magic firsthand. That’s why we put our marketing dollars into traveling exhibits and special sponsorship agreements, such as the one we have with Little League Baseball. Our products are available through hobby and specialty toy retailers.
Even beyond product quality, name recognition, and good will, there must be an underlying appeal for any toy to survive an ever expanding and increasingly competitive market. Lionel’s appeal stems from something somewhat simple, basic, and necessary, according to Moreau.
Trains, families, and memories. Trains are big, rugged machines that are an enduring symbol of travel and adventure. And because of that, a Lionel train was the ultimate Christmas gift for children in the 1940’s and 1950’s. An heirloom gift that lasted a lifetime, the Lionel train set provided the perfect family activity, equally enjoyed by young and old alike. And as those children grew to adulthood, their interest in trains and those wonderful memories of youth sustained their interest in Lionel.
Ask an adult hobbyist about their interest in Lionel trains and the conversation will eventually get around to childhood. Ask a collector what they ultimately hope to accomplish and they will invariably talk about allowing a child to enjoy the wonder of Lionel trains that they experienced as a child.
Today’s children’s market, though, has an abundance of leisure opportunities not available years ago. Old-fashioned toys like train sets compete in the marketplace with technology-based items. Computer games and the Internet provide stiff competition. One aspect that separates Lionel from other leisure activities is the opportunity to work with your hands and build something from scratch. Creativity is stimulated.
Moreau explained technology’s value in serving Lionel’s purpose rather than thwarting it.
Our trains have the appearance and quality of their youth, but they now employ the very latest digital technology. But instead of using technology as an end in itself, we use it to enhance the traditional qualities of Lionel railroading. It’s more than a product. It’s an activity. It’s an activity to be shared with family and friends, an activity that doesn’t just entertain you, but involves you and stimulates you to develop your knowledge and your imagination.
Since the company has been around for more than a century, one might logically think a significant percentage of Lionel buyers have a common thread. Such is not the case. Moreau explained the diversity of Lionel buyers.
Frankly, our customers are as diverse as our products. Some have been involved with the hobby all of their lives. Some had a Lionel train as a child and have re-entered the hobby in order to provide their own children with the wonderful experience they had. Others have never had a toy train set and either want to finally satisfy the unfulfilled hopes of their youth or are looking for an activity that will allow them to spend enjoyable and productive time with their children.
Moreau further indicates the most important innovation transcends any actual product, invention, or device.
Lionel did not set out to be a collectible products company. It set out to make innovative toys that were fun and brought people together. By sticking to that mission, Lionel was able to acquire a legend that no other train company can ever match. It is that spirit of innovation and clear vision that was Lionel’s greatest achievement and led to all of the many technical and design breakthroughs that collectively define its history.
Our mission is to maintain the magic and the legend of Lionel through the manufacture of products that bring families together to share activities that are fun, educational, and imaginative. As our company tagline says, ‘Dreams that endure for generations and fun that lasts a lifetime.’
Richard N. Maddox replaced Gary Moreau as Lionel President in 1999.
In recent years, Lionel has faced tremendous challenges despite receiving a boost of recognition from the 2004 film Polar Express, being inducted into the National Toy Hall of Fame in 2006, and maintaining loyalty in its fan base.
In 2004, Lionel filed for bankruptcy. In 2008, the U.S. Bankruptcy Court of New York approved the company’s Chapter 11 reorganization plan. Lionel is now fully out of bankruptcy. Neil Young is no longer a minority shareholder.