Toyota Targets Youth With New Scion Brand
Toyota Motor Sales U.S.A., unable to command the respect among young car buyers enjoyed by competitors such as Honda and Mitsubishi, will begin marketing a line of youth-oriented vehicles in the United States as early as next year under the Scion brand name.
The Torrance-based U.S. arm of Japan’s Toyota Motor Corp. confirmed the new name Thursday, saying that it will give Toyota a chance to approach the youth market with a fresh new image.
Although Toyota is the biggest import brand and the fourth-largest car brand overall in the U.S., its vehicles generally are thought of as mainstream cars and trucks and have little appeal to buyers under 30. The company isn’t alone in eyeing the large and growing youth market but is unique in starting a new brand to serve it.
Analysts generally applauded the move, saying Toyota needs to push for a younger audience and is big enough in the U.S. to support a third brand to go with its mainstream Toyota and luxury Lexus marques.
“They are like General Motors Corp. was 10 years ago, viewed as an old people’s brand,” said Brett Smith, senior auto industry analyst at the nonprofit Center for Automotive Research in Ann Arbor, Mich. Separating the Toyota name from the company’s youth marketing effort is a smart move, Smith said. As Toyota, “they just don’t have the image, the cachet, in the youth market that Honda does.”
Toyota executives refused to discuss specifics of the company’s youth initiative, saying plans will be revealed next month at the New York Auto Show. Toyota spokesman John Hanson did say Thursday that establishing the Scion brand is part of an effort to build and sell new types of inexpensive, youth-oriented vehicles.
Industry insiders say Toyota intends to use Scion to bring into the U.S. the kinds of small cars and vans that sell well in Japan and Europe but have not found a place here so far. Among them, insiders say, will be a boxy four-door wagon-cum-van sold in Japan as the bB--the initials stand for black box--and a sporty five-door sedan called the WiLL that has been shown in the U.S. as a concept car but has been sold in Japan since last summer.
Toyota also is expected to give Scion several new versions of the Echo subcompact sedan it introduced in the U.S. as a 2000 model. One of those could be the Yaris hatchback sold throughout Europe. The Echo, which has failed to set sales charts afire, was part of a trio of Toyotas, including the Celica and the Prius gas-electric hybrid, that the company had hoped would start drawing young buyers into its showrooms.
Today, the average Toyota buyer is 48 while the industry average is 47, said Jim Hossack, senior consultant at AutoPacific Inc. The average Echo buyer is 43, he said. The average Honda Civic buyer is 37. Volkswagen’s Jetta claims one of the youngest buyer groups with an average age of 32.
Because cars sold under the Scion name will be low-volume, low-profit vehicles, Toyota isn’t expected to make dealers who want to carry the line build expensive, stand-alone facilities as GM did when it launched the Saturn brand in 1990. Instead, it is likely that Toyota dealers that also carry Scion will display the cars in a separate area of their showrooms and on a separate part of their lots. There might even be a separate entrance to the Scion section of a dealership.
