Toyota’s trouble child

When Toyota, the world’s largest automaker, first introduced its youth-oriented Scion brand to the California market in 2003, the idea was to pique the interest of twentysomethings who viewed vehicles like the Camry as something only their father would drive. The styles were eye-catching—particularly the boxy xB wagon—and the marketing was Guerrilla 101. The cars were parked outside hip nightclubs, where trendsetting patrons might be convinced to book a test drive. Marketers created video game contests and a record label to give the Scion brand more street cred.

It worked. Sales took off—that is, until the recession hit and sent youth unemployment levels soaring. In 2009, Scion’s U.S. sales fell nearly 50 per cent, to about 58,000 from some 114,000 a year earlier. The brand also suffered from a lack of new models, so Scion responded by promising a refreshed lineup. And, this year, the cars will be sold in Canada for the first time at 45 Toyota dealerships across the country.

But it remains to be seen whether Scion can get its mojo back and boost Toyota’s sagging fortunes. “There was a lot of excitement when the brand first launched,” says Jeff Schuster, the executive director of automotive forecasting at JD Power and Associates. “Not only did it attract the younger buyer, but some not-so-young buyers into the Toyota family. But in recent years its sales have fallen off pretty significantly. Its uniqueness isn’t what it used to be.”

Scion may find the Canadian market more difficult to crack in 2010. Net-savvy Canadians are already familiar with Scion’s cars, having viewed them online for years, and competitors are now selling edgy, urban xB look-alikes north of the border, including the Nissan Cube and Kia Soul.

Which may be why Scion is touting its dealership experience as another differentiator. There is a focus on online shopping and salespeople who will help buyers customize their vehicles. The showrooms are also supposed to be equipped with a PlayStation 3 and free CDs “featuring artists that are relevant to the Scion lifestyle.” However, it may take more than some hip tunes and a few games of Grand Theft Auto to convince buyers that Scion remains a different animal.