I found out from another forum the major reason for our complaints. The below is translated from a newspaper article which was translated using bablefish.

Maerklin is heavily at pressure. The conversions
break away, customers criticize unsatisfactory
delivery behavior, and the banks send a
management consultation from Munich to the
Goeppingern into the house. Of Soenke Iwersen No
horror number, which is not still undercut. When
the management and the work council of Maerklin
negotiated one year ago about the basis for an
occupation safeguard contract, managing director
Paul Adams put a number on the table: 130 million
euro. That, said the managing director, is the
most unfavorable case, which lowest conceivable
conversion, with which Maerklin must be
nevertheless survivable however. In order to
ensure this, the model course manufacturer
diminished 342 places in production in
Goeppingen. Work council and trade union agreed,
because 130 million euro sounded expressed 2004
as pessimistic prognosis. That changed. "our
expectations will not arrive probably", say Adam.
Which expectations are this, he does not say.
Maerklin publishes no more reference numbers for
two years. 2003 did not lie the conversion with
164 million euro, over 2004 are anything
well-known. After information of the Stuttgart
newspaper the production target was not reached
by 145 million euro. For 2005 a repeated
break-down is approaching. The past horror
conception seems thereby after today's conditions
almost as a dream goal. "130 million would be an
enormous achievement", say a leading employee. A
conversion of 115 million euro seems realistic -
that would be opposite 2003 a break-down of 30
per cent. In addition, Adam denies this number,
calls no different one. On a workshop meeting the
managing director announced, one must about a
dismantling from 70 to 80 further places think,
if the situation did not improve. This is to
happen however without notices. The Beschaeftigu
ngssicherungsvertrag, which runs until 2010, is
to be maintained. Still 720 coworkers are active
in Goeppingen. As reason for the crisis the
Adam's bad surrounding field constitutes. The toy
industry stagnated, the customers bend rather to
saving as for consuming and also the coalition
contract is unsuitable to set the business in
motion. Whether all this can be however reason of
enough for such violent recessions in sales as
with Maerklin is doubted, in the industry.
"hauptproblem of Maerklin is the stupidity in
planning", says Ingrid bitter, the business guide
of model railway pupil in Stuttgart. "from
January to May 2005 important tracks were not
available. That cannot be done simply." Bitterly,
sold, recently the central station in such a way
specified station received for 30 years the model
courses from Maerklin. The controller was
announced in February 2004, which shifted supply
since then for various reasons. "the customers
are annoyed, if they come into the shop and do
not find, what it in the catalogs see", say
Norbert Sawinski, a dealer in Frankfurt. "I got
the whole summer no novelties from Maerklin
supplied. And then the people save the money
evenly not, separate spend it on other things."
The question remains whether Maerklin is strong
enough, in order to free itself from the crisis.
Between 2001 and 2003 the result was altogether
about 2.5 million euro. However the personnel
reduction 2004 cost 13 million euro. The business
banks of the model course manufacturer are so
alarmed that they sent the Munich management
consultation Wieselhuber & partner after
Goeppingen, in order to analyze Maerklin. The
first result: Maerklin is classified as
reorganization worthy and as reorganizationable.
She suggests which reorganization steps, the
management consultation did not want to say
yesterday.


It seems like we are seeing some problems that some of us have suspected for quite some time. What does the future hold for Marklin ? We need to stay tuned to find out.

Yes, and they normally only look at cash flow and short term profitability, not products, customers or long term goals.

Thanks for the news.It dont look good with marklin.

People do like the two rails that three rails.Sorry marklin very high price.

Thanks for the report. Sorry to hear of Marklin's continuing problems. Looks like a USA type of management change. Just look at our corporations now. All the radical changes, and for what. I would say ZIP. Old saying, don't just stand there, do something. Well Paul Adams is doing something. The question is what? To many changes, and the business is outta control. Way outta control! He tinkered here tinkered there tinkered every where, and the volume dropped. Good show, now get outta here!

I sure did my part, and earlier that usual, Couple that to the new prices, it is no wonder the economy has tanked.


Again thanks for the dismal report

FWIW

Gene in sunny El Sobrante

Hi John,
Your idea of Lionel or Walthers Taking over are interesting. I would say Lionel is out of the question. They have their own problems (more of the legal sort than profitability) and knowing several powers that be there personally I can say the last thing they want to deal with is saving a troubled firm like Marklin, despite potential profitability and a new line of business (European protoype and smaller scales) Walthers, on the other hand would be motivated if you ask me. The question is do they have and are they willing to pay that kind of $, and are they willing to deal with a firm overseas. Their current line is just subcontracted, they do not own production facilities etc.. in China. Overall, I tihnk there isn't much to worry about. If Roco can be continually saved Marklin should be a no brainer- at least their stuff works properly and doesn't break when you touch it.

Hi all,

Just annouced today at Marklin:

170 more Employees are being layed off, this time it will be in Managment a Developmet departments.

I guess the Consultant's have spoken.

Martin

problem not just Adams, but he did nothing to stop/help it. probably goes as high as the maybe foolish move to EU and the Schroeders handling of the german economy - you are overtaxed, and too much handouts, too much socialism. As germany no doubt marklin's main customer base, it is no wonder marklin's business suffers during a recession.
what adams should have done in these lean times was not to launch so many new products like the CS, signals, new molds for short MHI runs....
if overall spending in germany down, who did he think was going to buy all this new stuff? during economic slowdowns is the time to reduce costs, upgrade manufacturing.
the economy locos were stuff they shoull have concentrated on. older digital sets at reduced prices, other stuff like that, then when does economy picks up, resume work on CS.
there's got to be some more capable business managers in germany than these guys. maybe that's what the bankers will tell the ownership.
I don't agree about the one posting about a "typical" USA management change - tell me, where would companies like LTV Steel, Lukens, Special Metals, Enron, be today if the management was taken over by outsiders appointed or bought out by bankers and others? they would be locked shut and maybe turned into empty lots. Not everyone is cut out to be a leader or a manager of a business. An MBA doesn't get your there either.

Sorry everybody !!!!

Instead of reading and enjoying my daily know-how update in a forum that can really be recommended to all of you, namely the "marklin-users.net" website, I have for the past two hours tried to find anything resembling this article at least vaguely.

I tried to find any forum or website containing searchwords like Märklin Stellenabbau, Wieselhuber und Partner, Modellbahn Schüler Stuttgart and Norbert Sawinski, to name only a few of the keywords mentioned in above article.

I tried everything. In a German forum a source is mentioned: SWR-Online, a state owned radio and tv station, which would be rather reliable. In their search database Märklin can be found three times, once about Göppingen, twice about the recent theft and its trial that is running at the time being .....

Nothing of any kind anywhere to show that this article exists in fact.

<u>Until I see a working link to web information concerning this thread I will simply refuse to believe it.</u>

That does not mean that I might not be suspicious after all the too many rumours one hears here and there. But again: with all due respect to open dircussion here, a company we have come to love and (only very) sometimes hate at the same time has a perfect right to be protected from simple and maybe stupid, maybe even intentional gossip to undermine their status in this difficult market.

Sorry, once again.

Hans

don't start paniccing. If everybody keeps buying they will survive. If a crises pops up, it will be felt but at the end the crisis disappears and marklin will survive. If Not, my collection will start earning its money

My (US) company was bought by a DE company. Replaced all management with DE, 'harmonized' business processes, etc.[xx(]

I still like Marklin and EU trains.[:o)]

Are you saying that NOBODY can show us this alleged article ????

You do not want me to believe such that is discussed in Bar and grill is true ??

Anything substantial maybe, somewhere ???

Regards,

Hans

Where did this article appear! Without confirmed publication, we should'nt publish such comment without being verified.
Stephen(USA)

Why does Marklin stuggle, despite moving some production to China, while Fleischmann, with product still made in Germany (all of it?) do well? What is their business model?

Yes. The old catalog format was good enough. Did everything a catalog needed to do. I have to admit that I like the CD format, though. I carry it with me and can easily check an item wherever I am without carrying around a big book.

&gt;&gt;Why does Marklin stuggle, despite moving some production to China, while Fleischmann, with product still made in Germany (all of it?) do well? What is their business model?&lt;&lt;

Fleischmann will eventually fall too. Why? They have engaged former
Märklin CEO Wolfgang Topp as a consultant, according to German forum reports.

Roco and Märklin shot each other out of the market with high prices,
poor quality and too many new items they couldn`t fund from their
revenues.

Parasiting owner families, the Märklins, the Fritz`s and the Safft`s.

In addition Märklin swallowed Trix, but didn`t stand up to the needs
of the more critical 2-railers regarding detailing, price, and running characteristics. Too much branding hype.
How does Z-scale sell?
How does #1 gauge sell?

Technically outdated assembly lines due to decades old construction principles. Nobody else makes locos put together with as many screws as Märklin. Too much soldering, too many cables.

That`s my opinion.

Regards,
Manfred

I'm doing my bit! I've spent about 1500 Euros with Marklin alone this year!

The last stressed.

Buy GOOD goods from Märklin, not the bad ones.
There is one single strike IMHO they should do. Concentrate on what they are good at, and adopt standards to let others do their parts. The CS should be totally abondanded; Let's say they will succeed to get people pay for it; they will still have the whole burden of further development, accessories around it etc, and there will soon be a saturation of the market (as with the 6201). There is nothing free for them. And their stubborness will hinder the selling of locos etc, where they really earn money. They should keep a simple unit as the Mobile Station for themselves, but letting it talk LocoNet or eXpressNet to other units.

/Lars

I believe all the newer american cars (45801, 45800, etc...) are China made as well.
My ebay.com(US) purchased boxes have had a black "made in China" sticker on them (US-law I guess). The same boxes in Sweden/Germany do not have them...

Yes, now that I think about it, I remember reading that in several places. Also let's not forget our those precious digital components. I doubt any of those are manufactured in Germany/Europe beyond the final assembly of the components.

p.

I just hope the SYSTEMS won't be a debacle!
And take MÄRKLIN down!

Ulf: I guess M's whole new line of U.S. models (id est: cars and locos) is made in China. However, this is o.k. for me. Since they look great, are nicely detailed, run perfectly well and give me not the slightest trouble [:p]

We Western nations sometimes tend to forget the fact how dramatically the East has developed during the last decade.
This isn't anymore only the cheap mass production from the 1980s and 1990s. They are clever and they've learned to build also top quality at resonable production costs - in case their partners look for such and are willing to pay for.

John

David: What makes you think that Uhlenbrock is " a small firm that struggles to produce what it advertises"? It seems that Marklin is having a lot more trouble producing what it advertises than Uhlenbrock.

Hi Ron. I have been waiting for Uhlenbrock 63820 for more than a year now. Having emailed them I eventually got a reply saying they did not know when the product would be available.
Just a one line reply which took six weeks to reach me.
Looking at their product range they dont make much and if one year down the road they cant produce a small accessory which they are happy to advertise then I would not buy anuthing further from them
Marklin may be slow as well but at least they are a firm of some standing and they do eventually come good. (hopefully)

David

Ron: If I were waiting more than a year !!! for that f****** part - I would [}:)]

I agree with most comments about Uhlenbrock; they really make excellent products, can't be stressed enough, but they are a little firm and not as capable to deliver, and keep market contacts. I can just guess that have had problems enough with the weak german market last year/years, with lack of people for support. And they are very focused on the german market.

But David, are you avare that Heljan has a cooperation for about one month, which means marketing their products in scandinavia, and UK. So I guess very soon any Heljan dealer will also be able to sell Uhlenbrocks products. And (guessing again) Heljan is not unknown in UK, as they make some good models for you?

/Lars