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2004 Scion xB Road Test

Toyota Hopes to Make It Big with Small Brand

If you live in California the xB is no longer an anomaly. No, the tiny box that has become the trademark shape of Toyotas new Scion youth-oriented brand is just about everywhere.

First unveiled as the Toyota concept ccX at the 2002 North American International Auto Show in Detroit, it showed up a few months later at the New York Auto Show as the genesis of an entirely new brand, the Japanese automakers third for the United States.

Since then, Scion began selling its first two models, the xA sedan and xB van/sport-utility-like vehicle, in 105 California dealerships on June 9, 2003, and theyve been doing very well, said Jim Farley, Scion vice president.

I caught up to Farley at the Automotive Hall of Fame in Dearborn,

First unveiled at the 2002 North American International Auto Show in Detroit, the Scion xB is now a common fixture on California roads. (Photo: Scion, Toyota Motor Sales)

Mich., while he was briefing journalists on Scion and revealing a third model, a sports coupe dubbed the tC to be released next year.

"Scions target buyer is information rich, time poor and highly technology savvy," Farley said. "Scion will cater to this influential generation with unique products, a distinctive dealership environment and a revolutionized sales process, all complemented by an astonishing sticker price

Toyotas reasoning behind the Scion brand is that they want to appear fresh and modern to the children of the Baby Boomers. (Photo: Scion, Toyota Motor Sales)

(ranging from $12,480 for the base xA to $14,480 for the xB with automatic transmission)."

Basically, the reason behind Scion is that Toyota has been concerned that the children of Toyotas Baby Boomer customers, who are just coming of age to purchase their first new cars, will regard their parents Japanese automaker as stodgy and will be seeking other products. Korean competitor Hyundai, along with Kia, has been successful targeting the entry level of the American market with a similar

Gen Y has many diverse groups--they cant be easily pigeonholed like the boomers or Gen Xers. (Photo: Scion, Toyota Motor Sales)

strategy.

The Korean automakers progress resembles the way Toyota, Honda and Nissan became successful in the U.S., but they have been growing at a more rapid clip than the Japanese Big Three initially did.

The upcoming generation, currently called "Gen Y" or "millennials" by some demographers, has received intense focus by all the automakers because it is the largest wave of potential new car buyers since the boomers after World War II. The general consensus by many demographers is that Gen Y has many diverse groups--they

Scion is aimed at the Gen Y segment that would respect Toyotas quality, but eschew its normal entry-level cars. (Photo: Scion, Toyota Motor Sales)

cant be easily pigeonholed like the boomers or Gen Xers--and its members have very little brand loyalty.

By 2010, Gen Y will account for approximately one-quarter of all vehicle sales, Farley said. Ten years later, they will make up 40 percent of the car sales--roughly 6.5 million units in a 16-million vehicle market.

Gen Yers like to discover brands at their own pace and demand "authenticity," stressing that things need to be "real," Farley said. They treasure relationships with family and friends.

Scion is aimed at the Gen Y segment

The xB looks very much like a low-slung sport utility vehicle, and offers plenty of cargo room. (Photo: Scion, Toyota Motor Sales)

that would respect Toyotas quality, but eschew its normal entry-level cars, like the Corolla, he said. Toyota, meanwhile, will continue reaching for mainstream youth.

"Were not trying to hide that Scion is made by Toyota," Farley noted. Rather, it is a unique set of vehicles, based on the companys new basic car platform developed in 1999 that includes the Toyota Yaris 3-door model that is sold in Europe and soon in Mexico and Canada (as the Echo Hatchback), the Toyota Echo 4-door sedan in the U.S., and four models in Japan.

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