LOS ANGELES — Scion got off to a fast start five years ago, but now Toyota executives are forced to rethink their funky experiment — and do it a lot sooner than they expected.
At issue is Scion's mission — and whether the idea behind the trendy brand still makes sense.
A year after the second generation of Scion's youth-oriented vehicles debuted, Toyota faces several problems:
-- The number of young people shopping Scion has dropped dramatically since 2006.
-- Before $4-a-gallon gasoline gave all small cars a big boost in April and May, Scion was in a slump it couldn't seem to get out of. And in June, sales were declining again.
-- While the brand had attracted fuel-economy-minded buyers, many are much older than Scion's demographic target: 18- to 24-year-olds. That threatens the hipster image Toyota has carefully cultivated for Scion.
So was launching a youth brand such a hot idea after all?
"If we could relaunch Scion, I wouldn't ever have called it a youth brand, because it's a kiss of death," says Brian Bolain, a former Scion corporate manager who now runs Lexus' lifestyle events. "It creates problems when you start labeling."
Bolain says it is better when a brand can speak for itself.
"Scion is being forced to change," says Jeri Yoshizu, Scion's manager of sales and promotions.
"We have to refresh our message and move our picture to the new 18- to 24-year-olds."
But the constantly shifting target makes marketing a challenge, Yoshizu says.
The first-generation Scions were big hits with young buyers when they launched in California in 2003 and elsewhere in 2004.
But from last September through January, monthly sales declined from each previous month, even though dealers had two redesigned models in their showrooms. Year-on-year sales fell for 17 straight months.
The losing streak ended in March. Then when fuel prices soared in April, Scion sales shot up 41.5 percent compared with the previous April, when barely any cars were in stock during the first generation's selldown. Sales climbed 28.4 percent in May but were down again in June.