The Kingston Flyer's owner has put the business up for sale, on the same day he suspended operations because of safety concerns over the historic steam train's boiler.
Its 11 staff were laid off yesterday.
David Bryce said the safety of staff, passengers and the public was of "paramount importance" to the company, meaning it had no choice but to suspend the service. It was hoped the South Island tourist attraction, which operates at the southern end of Lake Wakatipu, would be back up and running in January next year.
The suspension meant those who had made bookings up until mid-January would need to contact the Kingston Flyer to either re-book or seek a refund, Mr Bryce said.
He also announced he was putting the business on the market because of concerns that running it was having a detrimental effect on his health.
"I now feel that I need to step back from the operation for a potential new operator to run the business," he said.
The decision to suspend operations was because leaks in the boiler of its AB778 locomotive had the potential to grow into cracks and in a worst case scenario cause the boiler to explode.
The Flyer would remain out of service until "extensive repairs" on the other locomotive (AB795) were finished, expected to be completed by mid-January.
Rather than fixing the leaky AB778 the company had decided to focus its efforts on AB795, which had been undergoing repairs since last June.
He said the stresses of operating it had been detrimental to his health after suffering a stroke close to the time he bought it from receivers a year-and-a-half ago.
He said he and his staff had put their "heart and soul" into running the train, but that the time was right to move on.
The Kingston Flyer, which was originally a passenger train service between Kingston and Gore in the 1890s, now runs on a 14km stretch of track between Kingston and Fairlight.