- With the biggest three engines going on strike, the Fat Controller gets Edward to help out and hires a new tank engine, Percy. But with Gordon, James, and Henry giving the others a hard time, they remain the biggest problem to the railway.
- At Knapford, there's no sign of the morning train, causing the passengers to become angry. The Fat Controller's told by the Stationmaster that Henry's refusing to leave the shed, so he goes to find out what's going on. Gordon tells him that he, James and Henry will no longer fetch their own coaches or shunt in sidings, declaring that tender engines don't shunt. The Fat Controller's very surprised that the bigger engines are trying to tell him what they're willing to do and leaves for Wellsworth to enlist Edward as a station pilot to ensure that the day's trains run as normal, noting to himself that the yard has never been the same since Thomas left to run his branch line. Edward's happy to shunt the coaches and the rest of the day's trains run as usual.
The morning, the Fat Controller visits the yard to see how Edward's getting along. To his dismay, he sees Gordon puff by and hiss rudely at Edward, who tells the Fat Controller that all the big engines hiss him and say he has black wheels, thinking he's a traitor since he's a tender engine as well. The Fat Controller kindly assures Edward that he has nice blue wheels and is very proud of his work, saying that tender engines do shunt. All the same, however, he decides that they do need a new tank engine to find a permanent solution to the problem.
Visiting an engine workshop, the Fat Controller is shown all kinds of engines. Soon he sees a smart green saddletank and knows this is the one he wants. The Fat Controller asks the engine if he's willing to work hard. The engine eagerly responds that he is. With that, the matter is settled. The Fat Controller names the new engine Percy and takes him back to the yard.
The Fat Controller asks Edward to get Percy acquainted with the yard and the pair set off for work. Edward's very impressed by Percy's hard work and loud wheeshing - something he learned in the workshop so as to be heard, which startles Henry when he attempts to insult Edward again. The Fat Controller then decides to send for Thomas and calls all three engines to the yard for an announcement. He tells them that he has shut up the big engines in the shed for their mutiny until they learn to behave and that, in their absence, the two tank engines and Edward will run the railway.
Edward and Thomas are put in charge of the main line, while Percy takes care of Thomas' branch line as well as looking after Annie and Clarabel. While there are fewer trains, the passengers don't mind as they understand that the two tank engines and Edward are doing their best to keep the railway running and that the big engines are in the middle of learning a lesson.
Meanwhile, in the sheds, Gordon, James and Henry are left cold, lonely and miserable. The three finally start to realize just how silly they have been.
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