If the gears are not broken, they could be worn. Check also that the armature does not have a worn bearing on the gear side, or a worn brushplate which serves as a top bearing for the armature. The Lionel supplements do not seem to have an exploded view of your engine, which seems to be #8200, an 0-4-0 switcher. A similar motor can be viewed here:
http://www.lionel.com/media/supplements/Supplement1to9/1Complete.pdf. Scroll to adobe page 420 (supplement section 15-71). Could you post a picture of the gear side of your engine with the cab removed? Thanks.
Larry