Wednesday, May 07, 2014

Lessons from York - What We Saw: Minors and Evergreens

Lionel H0 - in the 1960's kids just weren't interested in what this
venerable company had to offer.
Dad and I recently returned from our semi-annual trip to the Train Collectors Association (TCA) Eastern Division toy train meet in York, PA. This is the largest such show in the United States, and provides an interesting snapshot of the state of the hobby. 

It can also hint at the current state of collecting in general. As always, we discussed what we saw a lot of (and what we didn't) -- and why.

At the last show (Smaller scale, smaller sets) we noticed more and more vintage trains of other scales than 0-gauge and standard gauge. And that was significant, as it also represented a change in the market based on demographics. For toys, collectors seem most interested in the what was available in their youth (whether replacing what they had or obtaining what Santa didn't come through with).

American Flyer touted their two-rail S-gauge trains as a more realistic
(and space-saving) alternative to Lionel's larger 3-rail 0-gauge sets. And
yet Flyer also failed to make the transition to the even more realistic
and smaller H0 market.

A little background
Standard gauge trains were made between 1906-1933 and was the primary interest of the men who founded TCA in the 1950's. 0-gauge was introduced around 1932 and continued throughout the post-war era (Lionel ceased production in 1969). In the 1970's late pre-war and early post-war 0-gauge trains rose in value and popularity, as a new generation of collectors sought to reclaim their past.

In the 21st Century, though, middle-aged collectors are looking back to a youth with H0 gauge trains -- if any trains at all. And so for a while the recognized desirables of the hobby -- standard and O-gauge trains continued to be collected almost by default.

At the last show, we saw early N-gauge sets (introduced in the early 1970s) and common H0 sets in significant quantities for the first time. This show, that selection was somewhat refined.

A failed effort
When H0 became popular in the 1950's, both Lionel and American Flyer, who were heavily invested in other gauges, scrambled to get in on the trend. Both offered H0 train sets that were, for the most part, scaled-down version of the equipment they were offering in larger sizes. Both companies failed to make the transition, partly because the failed to understand that unlike 0-gauge (Lionel) and S-gauge (American Flyer), H0 was more about realism than toy-like representations.

This show there was a lot of H0 sets offered, but the selections seemed more focused. We saw on table after table both Lionel and American Flyer H0 sets in original boxes -- and all commanding premium prices. As well they should. H0 equipment is notoriously fragile (not matter who made it), boxes were often discarded, and neither Lionel nor American Flyer set sold that well to begin with.

Lionel's Standard Gauge State Set, 1929-1933. That's about 9 feet
of train, there.
The passing parade
Another thing we saw were the premium standard gauge sets. And beautiful they were to behold! Lionel, Ives, and American Flyer standard gauge trains all reached the pinnacle of quality right around the same time -- just before the Stock Market Crash. These top-of-the-line sets were premium products even in the late 1920's. Their original price tags represented several months' to a year's salary for many, so relatively few were sold. And after 1929, almost none at all.

My personal theory is that four things really determine value for a collectible item -- rarity, condition, desirability, and inherent value (materials and craftsmanship). Premium sets like the Lionel standard gauge State Set and the American Flyer Presidential Limited, continue to match all four categories.

The Chicago American Flyer Presidential Limited -- a beautiful set
that still commands high prices almost a century after
it was first offered for sale.

Because they were so expensive, sets like this were often only used for Christmas displays, and treated with great care (so although few were sold, they're almost always in great shape). Demand has remained high, and these are massive pieces have a great deal of inherent value.

The generation that fondly remembers toys from the 1920's is mostly gone. And so, too, (apparently) is the demand for those toys -- save the ones that are valuable for other reasons.

So minor offerings by the major post-war companies, and evergreen favorites seem to be the most popular items in the show this time around.

Next: What we didn't see.

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