"Potter" puts model trains back on track

NEW YORK (Reuters) - Sales of model trains are picking up steam again thanks to deals linking them to the "
Harry Potter" and "The Polar Express" movies, along with a new approach to marketing the old-fashioned toys.

Lionel, one of the big names in model trains in the 1950s, has watched as its business had to focus less on selling toys to kids than serving an older but much smaller hobbyist market. Folk-rock singer
Neil Young, 61, is so passionate about trains that he bought a fifth of the company in 1995.

Now, the company is bringing trains back to young people, and sales are up 40 percent in the last two years.

Lionel signed deals to bring out "Harry Potter" and "The Polar Express" trains, and filled shelves at department stores such as Macy's and Target, instead of just hobby shops.

"We're a resurgent brand based on nostalgic appeal," said Jerry Calabrese, chief executive of Lionel.

Last Christmas, the company advertised toy trains as the ultimate gift by setting up displays at Macy's Santaland and Grand Central Terminal in New York. Forty percent of Lionel's sales of $70 million in 2006 came during the Christmas season.

This sort of advertising is as much geared to children as it is to parents who remember Christmas train displays when they were young, said Andy Edleman, vice president of marketing for MTH Electric Trains.

MTH sells its trains with promotional DVDs and catalogs that portray parents and children enjoying trains together.

"We almost make them feel guilty," Edleman said, before adding that "people would prefer family participation and nostalgia" to things like Game Boys and PlayStations.

Companies such as Lionel and MTH also showcase their products at events like the World's Greatest Hobby on Tour. The show has attracted roughly 290,000 attendees in 11 cities since it was established in December 2004, said Dave Swanson, chairman of the tour.

At the show, children can play with Thomas the Tank Engine toys and ride giant trains while parents can run locomotives using wireless handheld devices.

"Our company and others are trying to infuse trains with as much technology as possible," Edleman said.

For example, in most MTH starter sets, a single handheld throttle allows users to command multiple engines and tracks.

Users can control the amount of smoke coming out of a locomotive and track the number of scale miles (km) a train has traveled. There is downloadable software to program new sounds and features into trains.

KIDS DON'T WANT TO ASSEMBLE SETS

Mark Guiffre, 34, a member of the West Island Model Railroad Club in Long Island, N.Y., said that such technology had made model railroading better, partly because users can run trains and switch tracks just by punching a few buttons.

It's ideal for young people because they do not want to spend a lot of time assembling the train sets, said Brett Einhorn, 16, of West Babylon, N.Y.

"They just like to run them," he said.

The West Island club tries to bring in new members by holding several shows each November.

"Fathers bringing their kids to the club is the most important part of model railroading," Guiffre said.

Lionel's golden years lasted from the mid-1940s through the 1950s, according to "Toy Train Collecting and Operating," a book by train expert John Grams.

Sales started dropping in the 1960s because of company mismanagement and the decline of trains as a mode of transportation. In 1969, Lionel found a steady market in baby boomer collectors who fell in love with trains as children.

But these hobbyists aren't getting any younger.

"Our membership is getting about 10 months older on average per year," said Jeff Pape, 61, a member of the Columbia Gorge Model Railroad Club in Portland, Ore. "We're up against trends in culture. If you have a job, that job consumes you. There are less vacation hours, less ability to get a day off."

Kelly Shaw of Classic Toy Train magazine estimates that the average age of the publication's readership is 59.

Dick Christianson, managing editor of Model Railroader magazine, said the resurgence in trains would probably start up a whole new, younger generation of model railroaders.

"One day they'll remember they had a train as a kid and say, 'Hey, I wonder if Mom has that in her attic somewhere'," he said.