Facing Downturn, Scion Turns To Metal To Move Metal

Edward Niedermeyer
by Edward Niedermeyer

A lengthy Automotive News [sub] story on Scion concludes with Scion VP Jack Hollis restating the brand’s basic myth:

Scion was not created for Scion’s sake. Scion was created for Toyota’s sake. It is an investment in Toyota’s collective future.

Hollis’s argument is bolstered by the scenario in which a youngster is attracted to a Scion store by the brand’s youth-oriented marketing, only to leave in a Corolla. Hollis argues that this model means Scion doesn’t have to worry about its sales volume… which is a good thing, considering the brand’s steady sales decline over the past four years. Hollis explains:

We still don’t go with a set [volume] number. Scion wants to be more influential. We want to talk to more people. We’re getting the right people, so the real question is: How do we get more of them?

I don’t know about you, but creating a brand to be “influential” and to “talk to more people” sounds like some vintage, dry-aged, old-school GM branding nonsense. And given that Scion’s sales decline coincided with the rollout of less-distinctive, more Toyota-like products, Scion’s apparent comfort with its recent declines smack of Old GM-style apathy as well (Scion execs respond with the old “but we gave customers what they wanted” chestnut). But don’t worry… Scion has a plan!

facing downturn scion turns to metal to move metal

How is Scion adapting? According to AN [sub]:

Responding to its multiyear sales slump, Scion is adding two all-new vehicles, including a sporty, $20,000-plus coupe… Scion also is making its retail sales approach a little less laid-back. And Toyota may build Scions in the United States to negate the currency disadvantage hitting its current Japan-built lineup.

Those two new products are the FR-S (FT-86/Toyobaru) sports coupe, which will expand the Scion brand into a performance-oriented niche it has never played in before, and the Scion iQ, a European-style premium city car. Neither will offer the low-cost, high-value positioning that defined Scion’s relatively successful first generation of products, although the iQ does seem to be the relatively better fit for the brand, offering high efficiency and urban utility in a tiny package. The FR-S, in particular, will be priced out of Scion’s traditional entry-level market, and will offer a level of performance and enthusiast-orientation that has never been a key part of the brand. Meanwhile, does that sales chart at the top of this story indicate that Scion should be expanded upmarket, or return to its roots?

But Scion is returning to its roots… in its least-compelling venue, namely marketing. Though niche-oriented marketing has been the one constant amid Scion’s fluctuating product mix and positioning, it’s largely been overly niche-oriented to the point of self-parody. Not that deviants don’t need cars too, but the real fuel economy and practicality value propositions offered by Scion’s first generation (in particular) often attracted a much-older consumer, creating a strange disconnect between Scion’s image and its reality. But don’t look for any of that to change, as Scion is doubling down on its too-cool-for-school positioning.

It is expanding its underground cultural reach into areas such as the “death metal” music scene. The rise of social media means Scion is loosening up the way it talks with Gen Y.

This gets back to the central myth of the Scion brand that Hollis points to, namely thatToyota has always viewed Scion as more of a mad-scientist laboratory than a profit center. It was intended to attract young buyers to the Toyota family in a way that mainstream Toyota compact cars never could.To understand how deeply self-deluded this perspective is, one must only look at the collapse of Scion’s sales and compare them to the competition’s movement towards offering ever-more-Scion-like products as part of their mainstream brands. From the Mazda2 to the Hyundai Veloster, from the Ford Fiesta to the Kia Soul, mainstream brands are adding fresh, funky, fuel-efficient cars to their lineups which are eating Scion’s lunch in sales, while directly refuting Toyota’s absurd perception that younger buyers will avoid cars aimed at them if they’re presented as part of a mainstream brand. After all, the Hyundai brand is expanding down into Scion territory with its Accent and Veloster, while simultaneously moving up into the luxury segment with its Genesis and Equus models.

Perhaps then, Toyota over-emphasized the importance of unique, youth-oriented brands. But, more tragically, Toyota also did its own mainstream brand a huge disservice by splitting off a youth brand, thereby signaling that Toyotas were, in fact, boring, utilitarian, unexciting vehicles. Why weaken a mainstream (and therefore, inherently flexible) brand in order to create a mediocre, over-marketed, under-delivering brand (according to a mystery shopper survey, Scion’s sales practices are third-worst in the industry, while Toyota ranks at about the industry average)? The sooner Toyota sees the light and pulls the plug on its failed Scion experiment, or at least return it to its original vision, the better.

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  • Canandovq Canandovq on May 31, 2011

    I think higher prices and customer misunderstanding about a new brand. Lexus is a different story. Lower prices, design improvement and sale it as Toyota and things, may get better. Think in a TOYOTA Xb, with a Corolla 1.8 engine, priced a little over a Kia Soul.

  • Ciddyguy Ciddyguy on Jun 02, 2011

    To be honest, I have never been too wild about the first gen xB and the xA was better but neither impressed me and part of the problem was, while MOST cars came with alloy rims as standard or at least as an option, neither car got them standard, just as options and NO ONE bought them, instead, went with aftermarkets, come on now. The original xB was a little TOO boxy and the wheels looked TOO small for the boxy body, the current model is better, but it looks heavier and somewhat more bloated than the original, which looked like a light weight vehicle for its size, now it just looks kind of heavy, but be that as it may, it's styling cues are an improvement IMO. The xA, it was a nice enough looking car and I liked it better than the first gen xB, however, I prefer the xD of the current car even if its based on the Yaris. But reading that people would not even consider it again left me kind of cold, as did the Yaris itself and the xD had some improvements made to it over the Yaris. And no, I'm not a young guy by any means, I'm middle aged and am ACTUALLY looking at getting the Fiat 500 over much of these types of cars, even the Kia Soul, Honda fit etc. Liked the fiesta from Ford but still, the 500 is the most fun little car I've had a chance to drive so far that sells for $20K or less.

  • 56m65711446 Well, I had a suburban auto repair shop in those days.
  • Dukeisduke Yikes - reading the recall info from NHTSA, this sounds like the Hyundai/Kia 2.4l Theta II "engine fire" recall, since it involves an engine block or oil pan "breach", so basically, throwing a rod:"Description of the Safety Risk : Engine oil and/or fuel vapor that accumulates near a sufficiently hot surface, below the combustion initiation flame speed, may ignite resulting in an under hood fire, and increasing the risk of injury. Description of the Cause :Isolated engine manufacturing issues have resulted in 2.5L HEV/PHEV engine failures involving engine block or oil pan breach. In the event of an engine block or oil pan breach, the HEV/PHEV system continues to propel the vehicle allowing the customer to continue to drive the vehicle. As the customer continues to drive after a block breach, oil and/or fuel vapor continues to be expelled and accumulates near ignition sources, primarily expected to be the exhaust system. Identification of Any Warning that can Occur :Engine failure is expected to produce loud noises (example: metal-to-metal clank) audible to the vehicle’s occupants. An engine failure will also result in a reduction in engine torque. In Owner Letters mailed to customers, Ford will advise customers to safely park and shut off the engine as promptly as possible upon hearing unexpected engine noises, after experiencing an unexpected torque reduction, or if smoke is observed emanating from the engine compartment."
  • Dukeisduke In an ideal world, cars would be inspected in the way the MoT in the UK does it, or the TÜV in Germany. But realistically, a lot of people can't afford to keep their cars to such a high standard since they need them for work, and widespread public transit isn't a thing here.I would like the inspections to stick around (I've lived in Texas all my life, and annual inspections have always been a thing), but there's so much cheating going on (and more and more people don't bother to get their cars inspected or registration renewed), so without rigorous enforcement (which is basically a cop noticing your windshield sticker is out of date, or pulling you over for an equipment violation), there's no real point anymore.
  • Zipper69 Arriving in Florida from Europe and finding ZERO inspection procedures I envisioned roads crawling with wrecks held together with baling wire, duct tape and prayer.Such proved NOT to be the case, plenty of 20-30 year old cars and trucks around but clearly "unsafe at any speed" vehicles are few and far between.Could this be because the median age here is 95, so a lot of low mileage vehicles keep entering the market as the owners expire?
  • Zipper69 At the heart of GM’s resistance to improving the safety of its fuel systems was a cost benefit analysis done by Edward Ivey which concluded that it was not cost effective for GM to spend more than $2.20 per vehicle to prevent a fire death. When deposed about his cost benefit analysis, Mr. Ivey was asked whether he could identify a more hazardous location for the fuel tank on a GM pickup than outside the frame. Mr. Ivey responded, “Well yes…You could put in on the front bumper.”