Whilst collecting some trucks from Maithwaite, Percy is spooked by a mine that sinks into the ground. Donald and Douglas make him even more frightened when they proclaim it is the naughty gnomes. Ironically, Percy is sent to collect garden gnomes for Lower Tidmouth, but is convinced that the garden gnomes are the cause of the mine's sinking.

Thomas collects a hot air balloon and takes it to Dryaw, where it is blown so holidaymakers can ride in it. Thomas and James become scared the balloon will steal their passengers. The balloon runs out of air though and it falls on top of James at a level crossing.