The Marx connection to Hafner

Hafner was a Chicago-based maker of clockwork-powered O gauge trains during most of the first half of the 20th century. The trains were inexpensive but durable. William Hafner developed the clockwork motor as a hobby around the turn of the previous century and put the motor in toys. Eventually he decided to make a train–perhaps he thought his two sons would like one–and he did. He even sold a set or two, but didn’t have the facilities to mass produce them, or the money to buy such a facility. So he approached William Coleman, who had an interest in a struggling farm tool company, and after Hafner secured an order for $15,000 worth of trains, Coleman agreed to use the company’s excess capacity to produce the trains.

And so began American Flyer, the company that battled Lionel for the hearts and minds of train enthusiasts for about sixty years.

But for reasons that Coleman and Hafner took to their graves, the partnership dissolved in 1914. The sons didn’t know exactly what happened. John Hafner said Coleman had promised his father a larger share of the company if the trains proved successful, then broke his promise. John Hafner said the two families had animosity afterward. But Robert Hafner recalled receiving wedding gifts from the Colemans in 1917, and said the dissolution was purely for business reasons. Going it alone, William Hafner formed his own company, rented factory space for $50 a month, and started a product line that would last into the 1950s.

Unlike his erstwhile partner, Hafner didn’t have to deal much with Lionel. Hafner’s greater concern was with this upstart named Louis Marx.

The Marx connection to Hafner
Hafner’s tin windup trains competed most directly with Marx.

Marx got his start in New York City in 1921. He was a protege of Ferdinand Strauss, and after leaving Strauss, he purchased the tooling for two obsolete tin toys, refreshed the lithography, rented factory space from an acquaintance, and by the time he was 26 became a millionaire. In 1928 Marx started distributing trains made in Girard, Penn., by Girard Model Works. This arrangement lasted for six years, but was more profitable for Marx than Girard. Girard tried to break free from Marx in 1934 but promptly went bankrupt, and Marx bought the company at bankruptcy in 1935.

Like Hafner and American Flyer, Marx sold inexpensive tin lithographed trains. Like American Flyer, they sold both clockwork and electric models. Hafner never ventured into electric trains. But while the Depression took out Ives and Dorfan and seriously wounded both American Flyer and Lionel, Marx and Hafner weathered the Depression fairly well. They also competed more directly with each other than with their more established rivals.

Both produced durable, reliable trains. John Hafner boasted about guaranteeing the motor essentially for life. They would repair a Hafner motor, no questions asked, for the cost of postage. If the spring was broken they would replace the spring, but Hafner said in multiple interviews that the most common malady was the spring coming unhooked, which was a simple repair requiring nothing more than a slotted screwdriver and the knowledge of how to grab the spring and hook it back into place. Hafner considered it good public relations, and enjoyed the free advertising they received when people would tell others to buy a Hafner train, since they got Hafner to replace the motor so multiple sets of boys could play with it through a period of several years.

Marx would do essentially the same thing. I know of one Marx collector who, as a boy, took a broken train to Marx’s New York office. There, he asked a kind-looking man if he knew where to take his train to be fixed. The man led him to a small office, and when the boy asked if he worked here, he smiled and said, “Kind of.” There in the office, a technician quickly repaired the train and handed it back. Years later, the boy saw a picture of Louis Marx and believes it was the president of the company himself who helped him that day.

William Hafner retired during World War II, handing the company over to his younger son, John. John Hafner ran the company until 1951, when he decided he wanted to retire early. David Marx, Louis Marx’s brother, toured the Hafner plant and examined the inventory, but did not make a bid. All Metal Products Company (aka Wyandotte), a Detroit-area toymaker that had distributed Hafner trains, purchased Hafner and moved production to Wyandotte, Mich., and later, Ohio.

Unfortunately for All Metal, the mid 1950s were the age of plastics. They struggled to shift to plastics and made several moves to reduce costs that proved ineffective. But the final blow came in 1956, when All Metal borrowed $2.5 million as an unsecured loan. In November, the banks called the loans due. All Metal asked for five years, and all but one bank was agreeable. The holdout, Corn Exchange Bank of New York, had one of Marx’s relatives on its board of directors. With no agreement in place, All Metal filed for bankruptcy in December.

Louis Marx bought All Metal at bankruptcy, and shipped the tooling to its Plastimarx subsidiary in Mexico to keep it out of the hands of any potential competitors. It was the same idea as how Lionel buried the Ives trademark to keep it out of reach of potential competitors. Marx liquidated the remaining inventory, supplementing it with Marx-produced items when necessary to complete sets, and Plastimarx produced new trains in Mexico for the Mexican market using the old Hafner dies for several years. Hafner-tooled Plastimarx trains are sought after collector’s items today.

Marx and Hafner collectors tend to collect both, partly because Lionel and Flyer collectors tend to ignore both, and their trains tend to be inexpensive compared to the larger brands. But I found it interesting how the two companies intertwined in the 1950s, and not just as two companies who competed with one another for two decades.

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