The Scion small-car brand serves as a testing ground for Toyota in everything from how to market accessories to how to recast the role of dealerships in the sales process.
While it’s been a success in that—as a ‘laboratory,’ as executives are eager to call it—a sales success it is not. The brand, which was launched in California in 2003 and nationwide in 2004, sold more than 150,000 vehicles in the U.S. back in 2005 and 2006; then it plunged to less than a third of that by 2010, and it’s made only a slight recovery post-recession.
Complicating the situation is that Scion’s current focus on cheap, customizable small cars seems to have at least one vocal rally for change within Toyota. The automaker’s North American CEO, Jim Lentz, has advocated for turning Scion into a tech-savvy premium small-car brand instead—one that would chase a sub-$30k price point, slotting just below Lexus and potentially rivaling the Audi A3 and Acura ILX.
But anyone who likes that idea shouldn’t get too excited. According to the brand’s chief, VP Doug Murtha, Scion is locked into its current template of low sticker prices and marketing to Millennials.
“We’re not seeking a new direction right now,” said Murtha, in an interview at the New York Auto Show last week, after the introduction of the new Scion iM hatchback and iA sedan. “For the foreseeable future I see this as a brand targeted under 35.”
A five-year plan to stay focused on Millennials
Murtha added that the brand has product plans that go out five years, with another two years beyond that, and there’s nothing in that plan that calls for a radical shift in product focus or positioning.
2016 Scion iM - live photos, 2015 NY Auto Show
“Right now there’s no prospect of it morphing into something else,” said Murtha, who also said the brand won't broaden its lineup into hybrids or electric cars anytime soon.
The Scion VP says that keeping course is a function of the perceived market opportunity with Millennials—the greatest group returning to the vehicle market over the past three years—as the economy recovers and they go to buy new vehicles. And Scion isn’t going to step away from that.
“It’s one of the biggest opportunity markets that people are still racing to conquest, so it makes sense to focus on that,” said Murtha, who added that since it’s a fluid market, generations will come in and out of it and they’ll need to adjust.
“The reality is you’re not going to do that through communication alone, you’re going to have to restructure the product lineup to support that proposition,” said Murtha, leaving the door open for a more radical remake. “And that’s a mid- to long-term discussion that really isn’t reflected in any of the products we currently have.”