JAMES FENLEY, LIONEL/MPC/FUNDIMENSIONS EXECUTIVE

(Dedicated to the Memory of my friend Jim Fenley; March 10, 1922 – January 12, 2006)

By Gordon Wilson TCA #76-10233

Regretfully this is written with very mixed emotions for, like many composers who penned “unfinished” works of music, this interview will forever be incomplete. I first met Jim Fenley in October of 1988, just a few months after making Arizona my permanent place of residence. I can recall that meeting like yesterday, because Jim and I “hit it off” and became good friends – a friendship that suddenly ended on January 12 of this year. On that day Jim suffered a fourth heart attack, and from this one he did not recover.

Most everyone reading this probably never heard of Jim Fenley, unless one is a student of the MPC/Fundimensions era of Lionel Toy Train production. Without question, in my opinion, and in the opinion of those who worked with him at Lionel, it was Jim who saved Lionel from the General Mills’ scrap heap. Put on your thinking caps and then take out your 1970 -1975 MPC catalogs. Some pieces today are interesting because of their unusual construction, but if you are in my generation, basically you were calling what was being produced at that time little more than “Junque,” with a capital “J.” Then in late 1975 along came Jim. Now, thumb through your 1976 through 1983 catalogs and I suspect you will notice a sharp turn upward in quality offerings. For a brief comparison, return to those BF (Before Fenley) days and see where General Mills was taking the fabled name of Lionel.

With such wonderful and grandiose locomotives catalogued as a Hudson and Berkshire, one would conclude that all was well in Mt. Clemens, Michigan. Persons who worried about the effect a cereal producing company would have on Lionel had only to look in the new catalog to have their fears put to rest. However, the “proof of the pudding is in the taste”, and what was produced certainly bore no resemblance to what was in the catalogs or what was subsequently produced. Instead of the magnificent large Hudson and Berkshire locomotives came such all-time cheapies as the 8140 Southern, in green plastic. It was General Mills’ interpretation of the Southern Crescent. It was a 2-4-0 with an 1130-type tender carrying the Mechanical Sound of Steam – beans rotating around inside a closed round disc sort of like a really cheap child’s toy maraca. Marx in the late 1960’s had made such a device and this one of Lionel’s seemed like a very poor attempt to copy it. No smoke – no whistle and a headlight. This was only slightly worse than the 8020 Santa Fe Alco A-B-A and the 8141 Pennsylvania 2-4-2 with Electronic Sound of Steam. In 1972, quite by accident, MPC did produce one highly collectible Alco Diesel. It was an 8022 Santa Fe Alco in dark blue/purple, of which only a few were made for J. C. Penney. Why so collectible? It was supposed to be a light blue plastic and these are very easy to find. Try to find the dark blue/purple version – Good luck!

Unfortunately, after this rare collectible, things didn’t get much better in 1972, 1973, 1974, or 1975. Along came such locomotives as the Kickapoo Valley 0-4-0, probably the cheapest engine EVER made. By this time Lionel/MPC/General Mills had expanded its marketing strategy. Kiddie City toy stores emerged. One of their primary functions was to market Lionel trains. One problem with this was that the quality of the trains was so poor that the serious collector/operator simply did not buy into the promotional gimmicks, such as the Feature End Box Cars. Even in the death throes of the original Lionel Corporation (1966-1969), they still offered Berkshires, Hudsons, and the old reliable Santa Fe F-3’s, along with a myriad of action-packed rolling stock and accessories. Compare that to the top-of-the-line early 1970’s Lionel locomotives with a wheel configuration of 4-4-2. Some of these had smoke and Electronic Sound of Steam, while others had the Mechanical Sound of Steam – the mechanism previously mentioned that contained beads rotating in a circular drum as it rolled over the 3rd rail. It sounded more like a “physically challenged” infant’s rattle than it did some marketing genius’s interpretation of a “choo choo” Sound of Steam.

Sales and company morale had hit rock bottom. American Flyer was gone; Louis Marx had passed away, leaving no heirs interested in running the company he had built; and now Lionel, in 1970, was merely a department of a larger corporation whose main products were breakfast cereals, one of which, Wheaties, was called the “Breakfast of Champions.” Lionel surely had been a champion, but those days were apparently over. Enter James Fenley as Vice-President in charge of Production and Operations. The year was 1976, America’s Bi-Centennial. A marketing strategy was apparently something long forgotten by General Mills’ executives. They made an assumption, and we all know how that word can jump up and bite. The assumption? That the LIONEL name was magic and would sell toy trains simply on past merit. Wrong!!! Because of slot cars and the space race between the USA and USSR, a whole generation of children grew up without a Lionel train circling the Christmas Tree. Jim immediately realized that for Lionel to recapture some of its past glory, the name needed to be seen and heavily promoted. He made this recommendation to the “powers that be” of both the parent corporation, General Mills, and the toy branch, MPC (Model Production Corporation, later known as Fundimensions) that they enter into production agreements with celebrities and major brand name corporations. Much to Jim’s amazement, delight, and satisfaction, his words were heeded and in the not too distant future, Lionel trains were being carried and promoted by corporations such as Sears Roebuck, True Value Hardware, and The J.C. Penney Company. A major celebrity, country/western star Johnny Cash, was engaged to make and promote a railroad song album, which is today a desired collectible called “Victoria Station.” However, the biggest coup occurred when an agreement was reached with the Disney Corporation.

Remember the rodent that some 40 years earlier had saved Lionel? Well, Mickey was going to do it again in the late ’70’s.

Jim was not through. Buoyed by the success of the corporate and celebrity tie-ins with Lionel, he felt very strongly that the time was ripe to do away with the perception of poor quality and cheap toys that Lionel had gained with collectors/operators of the early 1970’s. An excellent place to start was with the Train Collectors Association, by tying together the USA’s Bicentennial celebration with the introduction of a new Lionel diesel locomotive model, the U-36B, and coupling it with the reissuing of the 2400 series 0-27 gauge streamlined passenger cars. This Red, White, and Blue set was sold to TCA members only. The set turned out to be a spectacular success with TCA members. Sales were very good.

Money, however, was still an issue with the corporate moguls of General Mills. Investing large amounts of capital for new tools and dies was not a front-burner alternative. Luckily, many of the post-war tools, dies, and molds had made their way from New Jersey to Michigan and were in reasonably good condition. Seeing how successful the 9200 and 9700 box cars (quite similar to the 6464 post-war series) and the TCA Bicentennial passenger cars had been, Jim and his staff, which included Lenny Dean, decided upon a nostalgia line of merchandise in an effort to continue the upswing of the Lionel train name with the American public. Aside from the previously mentioned Disney and TCA affiliations, which led to sets and guaranteed sales, they decided to reissue Lionel’s all-time favorite locomotive, the Santa Fe F-3 in its “War Bonnet” colors. To avoid the potential of losing money, this A-A set was made in limited quantities. Jim told me that a normal run, to be financially feasible, would be in the vicinity of 5,000 units. He opined that his memory indicated to him that this run of Santa Fe F-3’s was considerably less than that. Therefore, the Santa Fe numbers of 8552 and 8553 are today among the hardest to find of all the regularly catalogued and manufactured MPC pieces.

Earlier I indicated that Jim Fenley could easily be called the person who saved Lionel. To further illustrate this premise, pull out of your archives the Lionel catalogues from 1976 through 1983. The litany of successes under Jim’s leadership is absolutely stupendous. In 1976, in addition to the 1976 Santa Fe F-3’s, we also saw the rebirth of the EP-5 “Little Joes” along with the Virginian and New Haven Rectifier Electrics. In 1977 comes the reissuing of the 8777 Santa Fe F-3 B-unit to complete the first A-B-A of the Modern Era; and as a part of the 1977 Service Station Special, the B&O Budd Cars made a reappearance on the Lionel tracks. Steam locomotives were radically upgraded with the 8702 Southern Crescent Baby Hudson locomotive and three (3) two-tone green passenger cars. A very popular reissue in 1977 was the 8701 4-4-0 General, which had originally jumped into the market place during 1959. Perhaps the biggest “leap of faith” by Jim and his team was the reissuing of a Lionel icon. Thirty years after its introduction in 1947 came the 8753 tuscan Pennsylvania GG-1. Quite naturally it was immediately compared with its post-war cousins; and, from an operation point of view, it came in a distant second. Why not a technically better GG-1? Keep in mind that Jim's Lionel crew were operating on a “shoestring” budget and with every new production reissue basically they had to prove themselves over and over again to the General Mills hierarchy and bureaucracy. While quality was significantly better than it was in the early ’70’s, compromises had to be made to the non-train cereal “Paint-by-Numbers” and “Star Wars” executives in the General Mills Corporation. In one “off-hand” comment, Jim said to me, “At times it was very frustrating because it seemed as though we always had to prove ourselves over and over again.”

In 1978 the F-3 diesels went from single to double motor power units and the 8801 Jersey Central Lines Blue Comet appeared for the first time as a post-war style locomotive, complete with a feed water heater above the boiler front, just like the real Central of New Jersey’s Blue Comet had. The next year saw Jim’s team reaching into the Lionel archives for yet another iconic reissue, the fabled FM Trainmaster. The post-war Lionel personnel had thought about producing a Southern Pacific “Black Widow” FM. They even went so far as to produce some mock-up prototypes. For reasons long lost to history, this idea never came to fruition. After a successful run of the Virginian 8950 in early 1979, Lionel’s Director of Operations masterminded the production of the FM Trainmaster “Black Widow” later in that same year. Armed with these successes, the diesel line expanded to include the real railroad’s all-purpose work horse, an all-new 6-wheel truck, with magnetraction, SD-18 in Milwaukee Road livery.

Beginning in 1980 and continuing until Jim’s retirement at the end of 1983, steam locomotives took front and center prominence. The Berkshire made a grand and glorious re-entry in 1980 with the 8003 Chessie special, and the following year came the Norfolk & Western bullet-nosed J-1, with the prototypical number of 611 – the only one still in existence. It is kept at the Virginia Museum of Transportation in Roanoke. Also, in 1981 motorized units began to reappear.

Two very significant occurrences took place in 1983. By now the MPC branch of General Mills had spun off into its own mini-corporation, known as Fundimensions, with Lionel leading its array of products. There was now ample financing to provide for some relatively expensive all-new tools, dies, and molds. The first of these set a trend in the hobby that was to be followed by every other American manufacturer of 0-gauge toy trains. The most beautifully decorated steam locomotive (in the opinion of nearly everyone) was the Southern Pacific’s fabled GS-4 “Daylight.” Although American Flyer had produced a “Northern” type locomotive as far back as the late 1930’s, Lionel had not made one. To Jim Fenley, Lenny Dean, and all the others on their production team, went the honor of producing the first modern 0-gauge No. 4449 – the S. P. Daylight. It was expensive, both to make and for the consumer to buy. That being said, it remains as one of the few early “modern Lionel” locos to significantly increase in collector value over the years. Another toy train innovation which took place in 1983 had to do with colors, specifically orange and blue. Dating back well into the 1930’s and perhaps earlier, Lionel trains seemed to be synonymous with orange and blue boxes, much as a big red star is indicative of Texaco oil products – it is just something everyone seems to know and accept. While the boxes’ colors were synonymous with Lionel, a promotional campaign using orange and blue trains had never materialized. In the late ’70’s Hudson Products, a “cottage industry” spin off capitalizing on Lionel’s fame, produced a very attractive and successful orange and blue train set by redecorating Lionel/MPC products. In doing so, they neglected one “minor detail” – they never bothered to obtain Lionel/MPC’s permission to use their trademark. Lionel sued and got a court ordered “cease and desist” ruling. When Lionel/Fundimensions issued their own orange and blue version in 1983, it was huge “hit” with the collectors.

Labor and material costs continued to rise, and midway through 1983, Fundimensions made the deadly decision to move their production facilities to Tijuana, Mexico. Jim was asked to relocate “south of the border” and to supervise the production and operations of that facility. Jim strongly advised and urged the corporate moguls running Fundimensions to reconsider their decision, but in the end they opted to move south. Prior to that decision, the 1984 line of Lionel trains had hit the drawing board. Jim had been instrumental in determining its contents. Among the new locomotives to be introduced in 1984 was another Lionel icon, the 20-wheel Pennsylvania steam turbine. Rather than pick up and move to Mexico, Jim, and his wife Helen, chose instead to retire to Scottsdale, Arizona.

"With Appreciation and Admiration from The Lionel Family James Fenley 1984"

Approximately five years later, my wife and I also retired to a nearby town in Arizona, Fountain Hills. It was through my involvement with TCA and the Desert Division that I ultimately met the Fenleys. Upon Jim’s retirement from Lionel in 1983, he was presented with a plaque that had on it one half of a cab of the bullet-nosed Norfolk & Western “J,” chromed and fully framed. It is a magnificent piece, and a fitting tribute to Jim’s time as Vice-President of Production and Operations of Lionel from 1976 to 1983. Jim knew how much I admired that piece, something I probably told him countless times. At Jim’s viewing this past January, his widow Helen took me aside and informed me that Jim had indicated to her that he wanted me to have that plaque. It now has, and always shall have, an honored place in my home.

As I mentioned earlier, having met Jim for the first time eighteen years ago, we soon became good friends. Jim kept up with the happenings at Lionel through many of the friends and contacts he’d made during his years of tenure there. One of his best friends was Lenny Dean. At “York Time” I was the conduit of mutually fond messages between these two men – giants both!

Jim, to the end, maintained the body of an athlete. He was about 6’ 2” tall and very distinguished looking, be he in a suit or just casually working around his home or attending a Desert Division monthly train meet. His wife, Helen, was and is, a very classy, thoughtful, and well spoken lady. I am proud and honored to call her a “friend” also. Jim was always one to positively promote our hobby. On several occasions he would do seminars about “Life at Lionel.” On a number of occasions over the years Jim did Educational Segments for our members at Desert Division monthly meets. Not surprisingly, from these “sessions” he gave us an insight as to what it was really like on the inside at the factory on 23 Mile Road. Prior to the beginning of each “talk” he’d say to me that “they’re not interested in this stuff;” the THEY referring to the attendees at a Desert Division Meet. Yet, each time he did one of these “programs” there was nothing but complete attention. The question and answer session normally went on until someone (NOT Jim) had to call a halt. Some of Jim’s recollections follow next.

The first thing that became abundantly clear was that perfect attendance by the U. A. W. member employees was all but non-existent. Some would call in sick; many just didn’t show up; and others, having found other employment, simply were never seen again. This made it very difficult to adhere to a strict production schedule. Often, Jim confided, items would walk out the door at lunchtime to be hidden on the grounds for retrieval later that day while on the way home. Although most employees were loyal and faithful to Lionel, as with any large group of people, a very few saw the opportunity to make some “hidden” money after work.

We all, I think, presume that Lionel has only recently gone “off shore” for their production. Not so. Even before MPC, Lionel had gone to Europe for products such as their ill-fated Post War HO line of trains. In the Modern Era, however, Jim relayed to us a rather funny episode that ultimately backfired on Lionel in the mid-seventies during the December Holiday rush period. I’m sure we’re all familiar with the “boat anchor” type blue, black, and red plastic transformers of that era. They came in virtually every low-end starter set. These were made in the Orient, Hong Kong I believe. They were delivered by container ship to the Port of Seattle and then trucked to Michigan. There (in Michigan) they underwent what Jim laughingly called “The Three Foot Smack and Drop.” Transformer were placed on the edge of a bench three feet above a slab of cement and then pushed off. If they survived, wonderful! If they didn’t, the whole lot would be returned to the contractor in Hong Kong. One such lot that failed occurred just as the Holiday Season began. True to their quality control policy, back to Hong Kong they were shipped, leaving Lionel and their retail dealer network and approved Service Station outlets to take a great deal of “heat” from the public and organized club members for non-delivery of Lionel Trains at Christmas time. Those were sales and customers never to be seen again. In the future, Lionel was not nearly so particular about the “cracking” of those “boat anchors” transformers. What an expensive “Catch 22” lesson learned.

Another faux pas, Jim admitted, was when Lionel attempted to enter the “Pre-school” market with the pull toy, “Little Huff and Puff.” First of all, it was much more expensive than its competitors. Secondly, Jim opined, it was too complicated (to assemble the track wasn’t easy for a toddler) and too big for the very small hands of its intended users. An expensive failure in every respect.

I know there were other tales of misadventure around the 23 Mile Road plant – Jim could and did keep us “in stitches” for time well past our normal Educational Segment. I simply cannot recall more than the ones I have related here. Jim always would tell us that there was never a dull moment in the Lionel Factory on 23 Mile Road. Oh, to be a fly on the wall!

All of this led me to the conclusion that a one-on-one interview would be of interest to many TCA members, especially on the TTML. Last fall (2005) we sat down after a meet and chatted about some of the happenings during Jim’s stay at Lionel. As I look back upon it, I am reminded of all the “hubbub” when Lionel announced some five years ago that they were moving all production to the Pacific Rim. By paying attention to the “3 foot drop” story you’ll notice that Lionel has been dabbling in Oriental production since the mid ’70’s. Nonetheless, what follows is the interview between Jim Fenley and myself. GW means I was speaking and JF refers to Jim Fenley.

GW – What was your title at Lionel and exactly for what were you responsible?

JF – I was the Vice-President of Operations from 1976 through 1983. This meant that I was solely responsible for all the manufacturing decisions of the toy train division of M. P. C., and later Fundimensions.

GW – How did you get your job with Lionel?

JF – My background was in the Electro-Mechanical field. I was working for an electronics firm on the West Coast when a friend asked if I’d be interested in a job at Lionel. I interviewed for the position and was hired.

GW – Were you a train collector prior to going to work for Lionel?

JF – No. I never had a toy train as a child. I liked boats and ships. (Editor’s Note: Jim served in the U S Navy during WW II )

GW – What was the marketing rationale behind the “Traditional” and “Collector” lines?

JF – Well, from an economic point of view the Traditional line was lower priced and mainly sets, ready to run, aimed at just getting people started in the hobby. The Collector line was aimed at the adult who was already a toy train enthusiast, but who would want to add a quality piece or two. You know the Collector line is primarily single pieces rather than complete, ready to run sets. With the Collector line we had more economic control. Limited editions were strictly that. All the tools and dies were destroyed at the end of a production run. Had we flooded the market, collectors would have lost faith in us very quickly.

GW – What was the reasoning behind the DC sets? In the opinion of many, they were a mistake because people bought them and would often burn them out with their ZW’s or other powerful Post War AC current transformers.

JF – I disagree. They were developed to attract the average person to the hobby. To do this we had to keep costs down. It was much easier to market a $79.00 set with a DC engine than it was to sell a $200-300 set to the first time customer. (NOTE: Jim is speaking about the 70s, not today’s more expensive sets) It was not our experience that, as you said, they would burn them out with a previously owned larger transformer. Once they developed and refined the Rectified DC motor, there was no problem at all. The engines were inexpensive and very reliable.

GW – I agree. The CAM motor was probably the best pulling motor that they developed in the MPC/Fundimension production years. Moving ahead –

GW - Who was responsible for or how were road names and items decided upon for release?

JF – Marketing surveys and Lenny Dean mostly. Consumer research was an extremely important factor. We tried very hard to be “tuned into” what the public wanted. The TCA was a big help in keeping us at the factory aware of this side of the market.

GW – Much criticism, early on, was directed to the lack of “service” at Service Stations. Can you shed any light on this?

JF – When I first joined Lionel, they had upwards of 1000 Service Stations. Many of them did no service at all, but merely wanted an excuse to receive the Service Station Sets. We tightened up our requirements and defined their responsibilities. We felt this helped the situation immeasurably. However, one has to realize that no Service Station can stock every part for every ailment of a toy train. Lionel has made millions of trains with countless parts. The factory cannot maintain a full inventory, especially for those trains made 70-80 years ago. If the factory can’t do it, it is not realistic to expect the Service Stations to.

GW – Whose idea was it to move to Mexico? Why was it done and how soon did they realize it was a mistake?

JF – The move was made at the Corporate Executive level and was done because they thought the material could be manufactured more economically. Since they only stayed for a year and a half, it didn’t take long to realize the error. Luckily, I chose to retire just prior to this period.

GW – How did Lionel determine their marketing strategy?

JF – They would first determine WHO they wanted to target in their marketing. Then they would concentrate on where to invest their advertising dollars. To go on Monday Night Football would have cost a fortune and, although it was a big audience, there was no guarantee anyone would see our ads. It was too late at night for the younger children and highly possible that Dad or Mom would go to the refrigerator during a commercial break. One constantly had to ask if it was beneficial and economically feasible before spending the advertising dollar.

GW – What was it like working for Lionel?

JF – Very nice. I liked my colleagues and liked everything about the company. It was a stable company where most of their employees stayed for long periods of time.

That concluded my interview last fall. Jim and I had agreed to continue again in mid-January. Unfortunately for all of us, Jim passed away on January 12, 2006. It was a great loss to the Toy Train hobby and the Desert Division in particular. A photo of Jim, along with an obituary, appears in the February issue of the Desert Division DISPATCH. You may access and read that issue by going to the Desert Division Website: http://www.tcadd.org/news/feb06_news.pdf

The following poem (?) appeared in the Desert Division DISPATCH several years ago, after the session in which Jim told us about the “THREE FOOT SMACK AND DROP” – Lionel’s rather unique and unscientific way of determining the production quality of the small blue, black, and red plastic transformers. An interesting R & D policy, don’t you think ?

AN ODE TO THE THREE-FOOT DROP TEST
or
What Went Wrong One Holiday Season

A boatload of transformers from the far, far East
Were bought by Lionel, as a baker buys yeast.
Wholly on faith and sight unseen
All assumed what they should have been;

But behold, the three-foot test, a dastardly beast.
One by one, plastic boxes fell
A three-foot drop to test the shell;
And one by one into pieces they shattered –
Black, Blue, and Red bits all bruised and battered
So not a single one could they sell.

“An Investment in Happiness,” so says the Ad.
A Lionel Train cannot be bad.
To make it run requires some “juice,”
But a broken shell is like a hangman’s noose.
A train without power is very sad.

What had happened? What went wrong?
To the transformers that traveled so far and long,
The three-foot test had done its job.
All the “assumers” could do was sit and sob.
To make it right was a whole new song.

So back to the labs they all did go,
Investing their time and much more dough.
Miniature trains had come to a rest,
Stymied by the dastardly three-foot test.

Lionel, it seemed had stubbed its own toe.
The solution was easy as making hay –
Do all the work in the U. S. of A.
Back to Michigan, on 23 Mile Road,
Soon came transformers, by the truckload.
And the three-foot test survives to this day.