American Flyer

American Flyer was a popular brand of toy train and model railroad in the United States in the middle part of the 20th century.

The Chicago Era, 1907-1938

Although best remembered for the S gauge trains of the 1950s that it made as a division of the A. C. Gilbert Company, American Flyer was initially an independent company whose origins date back nearly a half century earlier. Chicago, Illinois-based toymaker William Frederick Hafner developed a clockwork motor for toy cars in 1901 while working for a company called Toy Auto Company. According to the recollections of William Hafner's son, John, he had developed a clockwork train running on O gauge track by 1905.

Hafner's friend, William Ogden Coleman, gained control of the Edmonds-Metzel Hardware Company, a struggling hardware manufacturer in Chicago, in 1906 or 1907. Hafner and Coleman began producing toy trains using Edmonds-Metzel's excess manufacturing capability after Hafner was able to secure $15,000 worth of orders. By 1907, two American retailers, G. Sommers & Co. and Montgomery Ward, were selling Edmonds-Metzel trains. In 1908, Edmonds-Metzel adopted the American Flyer brand name for the trains, and by 1910, Edmonds-Metzel was out of the hardware business and changed its name to American Flyer Manufacturing Company.

Initially American Flyer was something of a budget brand, undercutting the prices of Ives, who was at the time the market leader. The trains proved popular, and American Flyer was soon expanding its product line. However, the company's rapid growth led to strains in the relationship between Hafner and Coleman.

In 1913, Hafner left the company. Believing he would be given a significant portion of the company if the trains proved successful, Coleman refused when Hafner asked to exercise this option. Hafner started the Hafner Manufacturing Company, which sold a line of trains called Overland Flyer. Sommers immediately stopped carrying the American Flyer trains in favor of Hafner's brand. Initially, the Hafner and American Flyer product lines were very similar, suggesting they may have been built using the same tooling. This suggests the possibility of the two companies continuing to collaborate. Hafner's business surivived as a manufacturer of clockwork trains until 1951, when he sold his business to All Metal Products Company.

American Flyer's business grew during World War I, which locked out German manufacturers, who had dominated the U.S. toy train market to that point. During this time, American Flyer also introduced bicycle and motorcycle toys, segmented its market by creating both a low-priced and a high-priced line, and began to depart from its earlier designs by William Hafner.

In 1918, American Flyer introduced its first electric train, an O gauge model that was simply a windup model with an electric motor in place of the clockwork motor. This was a common practice at the time. The same year, William Coleman died and his son, William Ogden Coleman, Jr., took over the company.

In 1925, American Flyer began offering Wide gauge electric trains at a premium price, attempting to compete with Lionel Corporation at the high end of the market. Like most of its competition, American Flyer did well in the 1920s, selling more than half a million trains in its best years, but suffered in the Great Depression, during which the company's focus shifted back to the more economical O gauge trains.

In 1928, American Flyer's competitor Ives went bankrupt. American Flyer and Lionel jointly purchased and operated Ives until 1930, when American Flyer sold its share to Lionel. During this time of joint operation, American Flyer supplied Ives with car bodies and other parts.

During the early 1930s, American Flyer struggled under increased competition, especially at the low end of the market. In 1931, Flyer announced it would not produce an electric train set to sell for less than $4 like its competition had. However, within three months, it relented and released a train without transformer that sold for $3.95, and in 1932, it released a set with transformer that retailed for $3.50. Sales increased, but the company was not profitable. Expansion into other toy arenas also failed.

A. C. Gilbert Company, 1938-1966

In 1938, Coleman sold American Flyer to the A. C. Gilbert Company, the makers of Erector Set construction toys, and production moved to New Haven, Connecticut.

Gilbert re-designed the product line and is popularly credited with creating the O27 variant of O gauge in 1939, in which the locomotive and car bodies are scaled to 1:64 scale, making them approximately 25% smaller than the 1:48 standard for O gauge, while still running on the same type of track. This allowed the trains to navigate tighter 27-inch curves that would cause a conventional O gauge train to derail or jump the track. While this resulted in curves that were much tighter than those that appear in the real world, it allowed more track in a smaller space. Other manufacturers quickly adopted this idea. By 1941, Gilbert had discontinued the earlier designs and advertised the new American Flyer products as "Every train 3/16 scale from front end to rear end." Some boxes were labeled "3/16 scale" and others labeled "Tru-Scale." As most prior trains from American Flyer and other manufacturers paid little attention to scale, this made the Gilbert American Flyers distinctive.

At the same time, Gilbert also released a line of HO scale trains.

After World War II, Gilbert discontinued the O gauge trains in favor of the slightly smaller and more realistic S gauge, which used two-rail track sized closer to 1:64 scale. Within a few years, a newer, more realistic coupler design also appeared. Flyer played up its improved realism, with two-rail track and realistic couplers, with Gilbert himself saying the design was inspired by his son's dissatisfaction with other toy trains available on the market. "Kids want realism," he said.

Although popular, American Flyer was always the #2 brand to Lionel in terms of market share at the high end of the market. With Marx and a handful of other brands relegated to the low end of the market, Lionel and American Flyer shared premium status. A rivalry emerged between both companies' fans.

Like Lionel, Gilbert was caught off guard by the popularity of HO scale trains that offered better realism at a lower price than its American Flyer S gauge products, and the changing interests of American youth. The problems were compounded by the death of its founder in 1961. With the popularity of toy trains and construction toys declining, and without another successful product line to buoy the company's finances, Gilbert found itself in financial trouble, and it discontinued the American Flyer line in 1966 and declared bankruptcy in 1967.

Lionel, 1979-present

In May 1967, Lionel Corporation announced it had purchased the American Flyer name and tooling. A May 29, 1967 story in The Wall Street Journal made light of the deal, stating, "Two of the best-known railroads in the nation are merging and the Interstate Commerce Commission couldn't care less." Former Lionel treasurer Robert A. Stein said Lionel did not initiate the deal; both companies had farmed out their accounts receivable departments to Arthur Heller & Co., who initiated the transaction. While various accounts publised over the years valued the deal at $150,000, Stein's recollection was that Lionel simply liquidated $300,000-$400,000 worth of American Flyer inventory for Heller in exchange for the tooling, which, by some accounts, sat unused and neglected in a parking lot for some period of time. Lionel Corporation never manufactured American Flyer trains.

Within two years, Lionel Corp. was bankrupt itself and had sold its train lines to General Mills, including the unused American Flyer tooling. In 1979, General Mills' Lionel division started to reissue Flyer products under that name. The brand name survives today, although Lionel's emphasis remains on its O and O27 gauge product lines. Most of the American Flyer-branded product sold by Lionel, LLC today are reissues of 1950s designs made from old Gilbert tooling.

Sources

• Osterhoff, Robert J (May 1999). "When the lights went out at Lionel." Classic Toy Trains, p. 76.