Model trains are often kept in spaces below grade, which are subject to dampness or worse, flood water! Fortunately, if your locomotives are left damaged from such flooding, it doesn’t necessarily equate to total loss. In this video, David Popp walks through the process of evaluating the damage through the steps required to get your motive power back into operation.
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That engine will need work. Dipping the parts in isopropyl alcohol will clean it up but if it is too rusty the best bet is go to eBay or the manufactures website, type in the part number, and replace it. Motors can be replaced so can shells the frame itself all it needs is to be cleaned up and it can work again.
David would it not been easier to use an ultrasonic cleaner?