On our way from Vilcabamba to Baños, we overnighted in Alausí, and the next day took the three hour return train trip to Sibambe past the Nariz del Diablo (Devil’s Nose). The train drops 500 metres in 13 km as it zig zags down the canyon. In years past, the route went from Sibambe all the way to Riobamba, and the trip was a big tourist attraction as you could ride on the roof of the passenger cars. That came to an end when an unfortunate tourist was killed by some low hanging wires. Picturesque though the ride was, it would have been more enjoyable on the roof as the train travels at a very moderate pace.
Our recommendation would be to arrive the day of the trip (the train goes at 8am, 11am and 3pm) and then carry on to Baños which has more to offer.
For more photos from the train trip in Alausí, see http://www.flickr.com/photos/sataylor/sets/72157626633687929/
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