Scion Contemplates New Segments

[Variance]

Scion Contemplates New Segments

Scion will step up its efforts to attract young customers, with products in additional segments and a streamlined purchasing process, reports Scion Corporate Manager Steve Haag.

Haag refused to name which segments Scion is considering, but he acknowledged the company's intentions to expand its product range. "It is the only thing that makes sense," he said. "Youth want lots of different products." But considering young buyers' price sensitivity, segments such as high-performance sports cars are off-limits, Haag added.

Scion is also examining Toyota's line of Daihatsu-developed home-market microcars for possible importation to the U.S. "Daihatsu has a lot of products that could fit," he said. Such small cars appeal to young buyers, but have great difficulty passing U.S. crash tests, so it may not be practical to bring one of those models here, he continued.

A hybrid would also be ideal for Scion customers. "Youth love hybrids," Haag said. "It would be a natural for us to consider those things." But for the foreseeable future, the added cost of having both gas and electric drivetrains makes the notion of a hybrid Scion unlikely. "At some point when Toyota can get the cost in line, we would do that," Haag said.

Among affordable, compact segments, a compact SUV or pickup are other possibilities. Young buyers love pickups and the FJ Cruiser, Haag said, but Toyota already has those customers and doesn't need Scion to reach out to them. "Our job is to appeal to a buyer who wouldn't buy the Toyota brand," he explained.

Scion can improve its pitch to customers with its current products by improving the buying process. The company already has simplified pricing, which appeals to young buyers, but once they arrive at the dealer the process can become time-consuming and contentious in the financing and insurance (F&I) part of the deal, which is where many dealers make much of their profit.

"Customers have said that they would like for us to make the buying process a lot quicker," Haag said. "Anything you can do to make the F&I process faster is good. That is where we see some dissatisfaction from buyers."

What this means to you: Scion knows young buyers have little brand loyalty, so the company is continuing to develop new products and improve its relationship with buyers to keep fickle shoppers happy.

Edmunds

[cire]

I think the xB has the crossover crowd satisfied in the brand. How about an affordable four door coupe (like the Mercedes CLS) built on the tC platform and using the same 2.4 liter 4 cylinder engine (with either a 6 speed manual or the Camry's 5 speed automatic). This would give the brand a sporty alternative to the humdrum Corolla sedan. Give it true avant garde, sporty styling (No, avant garde does not mean "Echo bizarre").

I am not sure if a small pickup would do well or not. Maybe a modern day El Camino but with four doors and a trick rear design like the Avalanche to offer versatility? To make it powerful enough, it would probably need a turbocharged 4 cylinder or the 2.4 liter 4 cylinder offered in hybrid mode. I am still not quite sold on this idea. I am having visions of the Subaru Baja (and we know what a "success" that was! Yeah, right!)

I do believe Scion needs to tread carefully. If the brand grows too much, I believe it will lose its cool factor with its target audience. This would defeat the whole purpose of the brand.

[mustang84]

But considering young buyers' price sensitivity, segments such as high-performance sports cars are off-limits, Haag added.

Another reason I'll never buy a Scion, and I'm in the target market.

[Newbiewar]

Another reason I'll never buy a Scion, and I'm in the target market.

i think scion missed their target anyway...

i see the b's used by soccor moms and green freaks... and i see the a's used by similar crowd... but not young...

the tc... yea that might focus a little younger... but mostly women...

[Robert Hall]

As the article says "Youth love hybrids," ...maybe they can come up with a Prius Junior model for the kiddies...

[ocnblu]

No gasoline required, just peddle it and generate electricity. Much like the Sr. version, no? :AH-HA_wink:

[AxelTheRed]

"Youth love hybrids"

Huh? Last I checked I loved gas-guzzling V8s with more horsepower and torque than I need for two cars and until Scion does that...if, by then, my prejudice against Japanese cars has been broken...then they'll have me as a customer.