Toyota to ax Scion lineup

DETROIT >> Toyota is killing its youth-oriented Scion brand after learning an important lesson: Young buyers simply want Toyotas.

Scion was formed in 2003 to court Generation X buyers who didn’t like their parents’ brands and didn’t trust traditional marketing, says Bob Carter, Toyota Motor Corp.’s senior vice president of U.S. operations. It was known for its funky designs, like the boxy xB, and was the brand Toyota used when it wanted to experiment with new kinds of marketing, like pop-up test drives or no-haggle pricing.

But as those buyers matured, they started buying Toyotas.

Next came the Millennials. For a while, that generation delayed car buying because they were underemployed and had too much student debt. But when they did buy, they liked their parents’ brands and wanted Toyotas, too.

“For those buyers, frankly speaking, Toyota as a brand is more aspirational than Scion was,” Carter said. Carter said Millennials made up nearly one-third of the Toyota brand’s buyers last year.

There were other issues with Scion. The small, oddball lineup never connected with buyers and cost a bit more, since features like touchscreens that were optional on other cars came standard on Scions. Scion’s best-seller, the tC coupe, starts at $21,330, or $2,600 more than a Honda Civic. Scion also doesn’t have any SUVs, which are rapidly becoming the most popular vehicles in the United States.

At the brand’s height, in 2006, Americans bought just more than 173,000 Scions. In 2015, they bought 56,167. By comparison, Toyota sold more than 363,000 Corolla sedans last year.

In Hawaii, the Scion brand was introduced in mid-2004 by Servco Automotive Hawaii, which operates nine dealerships around the state. Other units of Servco distribute Toyota and Scion models and other makes to dealerships on all islands. Toyota/Scion dealerships on Maui and Hawaii island are independently owned and operated.

Given the Scion brand’s transition, “our first two major concerns are taking care of our employees that work in the Scion area” and customers who have purchased the vehicles, said Rick Ching, president of Servco Automotive.

Servco Scion is a separate dealership in Servco’s Mapunapuna complex and employs 13 people.

Ching said there would be “no position elimination or layoffs.”

Customers who have purchased Scion vehicles can continue to have them serviced in the Toyota dealerships’ service departments, “so there’s no change there,” Ching said. Remaining inventory will be sold off and also will be serviced by Toyota, as the dealerships await shipments of the rebadged 2017 models.

Scion’s sales in the islands have been stronger than on the U.S. mainland, given Hawaii’s demographics and the brand’s deliberate appeal to the youth market, Ching said

“I think recently some changes Toyota has done to its lineup … appeal to a broader segment,” creating “less need for a separate brand,” Ching said.

The Scion brand was started in the U.S. and later spread to Canada and Puerto Rico, Ching said. “It’s not a worldwide brand,” but it has been limited to those markets, he said.

Beginning in August, 2017 model-year Scion vehicles will be rebadged as Toyotas. The FR-S sports car, iA sedan and iM 5-door hatchback will be a part of the Toyota lineup. So will the C-HR, a small SUV concept shown at the Los Angeles Auto Show that Toyota will likely make. The tC coupe will have a final release series edition and end production in August, according to Toyota.

The Associated Press and Star-Advertiser reporter Erika Engle contributed to this story.