Toyota’s Scion Looks to Hatchback, First Sedan to Revive Brand

Toyota Motor Corp.’s youth-oriented Scion unit is bringing two new vehicles to the U.S. to try and revive the brand after a 19 percent drop in first-half sales.

Scion is a small-car brand stuck in a light-truck market. Since 2014, every Scion sold has been a car, according to automotive researcher Kelley Blue Book. This year through June, 54 percent of U.S. sales industrywide were sport utility vehicles, pickups and vans.

Scion is adding its first sedan, the tiny iA, and a larger hatchback, the iM, with the new models available as of Sept. 1. None of Scion’s four current vehicles topped 20,000 in sales last year, when its deliveries slid 15 percent. The brand is phasing out the xD hatchback and the boxy iQ.

“These products help address that a little bit, but there are unserved markets when you’ve got four vehicles in your lineup,” brand chief Doug Murtha told reporters Monday in Detroit.

Relatively low gasoline prices and interest rates are helping demand for SUVs and pickups, which favors the Detroit Three automakers. The average vehicle sold for $33,340 last month, up 2.5 percent from a year earlier, according to Kelley Blue Book.

Toyota plans to introduce three Scion models in the next three years, including the iA and iM, in a revival effort. The Toyota, City, Japan-based company created the low-price brand in 2003 to appeal to drivers younger than its core baby-boomer customers. Quality hasn’t been a concern: The brand ranked in the top 10 in J.D. Power’s 2015 dependability study.

The four-door iA with automatic transmission will start at $16,800 and become Scion’s entry-level model. The iM with automatic transmission begins at $19,200, behind the tC and FR-S sport coupe. The xB starts at $17,915.

Toyota needs to sell at least 100,000 Scion vehicles a year in the U.S. for the brand to be sustainable and keep its dealers engaged, Murtha said in January. The company has committed to plans for new products to help Scion reach that threshold, last attained in 2008, he said.

Scion expects to sell 55,000 to 60,000 vehicles in the U.S. this year and crack 100,000 in 2017, Murtha said Monday.

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