Scion: Over the Hill?

In my main Toyota Scion review, I lampooned Japanese management, comparing their repeated attempts at hip corporate lifestyle marketing to the 1960's creation of The Monkees.

The practice of creating pop cultural phenomenons is a standard practice today, but any top-24 American Idol contestant has more musical talent than all four Beatle-look-alike Monkees had when they auditioned for the innovative 1966 TV program in LA.

"I'm not a musician, but I play one on TV."

You do have to admit "entry level brand price premium" is a slick marketing concept.

Scion looked like a hit record in 2003-2004, moving 15,000 to 20,000 cars monthly. January 2008 sales were 7,782 units.

But like most pop-phenoms, Toyota's youth brand experiment is losing sales. Second-generation models took too long to develop, slowing momentum.

The new xD hatchback and the bigger xB are struggling to maintain market share.

Yes, the subprime credit crisis is making first time car loans harder to get, but I think Toyotazilla is walking the same path to cultural detachment Detroit followed.

New Scions are heavier, bigger, less energy efficient, and cost more than the preceding models.

That worked in the American Century, a period of upward social mobility. Today's US market is different.

Luckily for Toyota, Detroit is even further off the cultural mark, offering scant competition for Scion.

Struggling Chrysler markets eleven different gas-guzzler SUVs. Zzzzzz....

Scion sales have fallen for 16 consecutive months, as compared to the same months one year earlier.

Monthly sales have declined every month since August.

With over 2/3 of dealers now carrying Scions, even bigger Houston Toyota dealers have only a few Scions on display.

Average monthly sales per dealer have fallen from 12 to 8. This is not enough volume to justify the affinity-squad sales training needed to properly sell Scion.

Bi-modal Distribution

Scion's identity crisis is intensified by selling to two distinct customer demographics; hip twenty-somethings who want identity-builders and older economy car buyers seeking value.

Holding both groups while maintaining the premium price cushion and customization option dealer incentive bit will be tough in 1931, oops I meant 2008.

Current Scions fail to stand out like the early models did.

xB is fat and lacks the wow factor (WTF izzat?) that drew hipster wanna-bes to the original. Is this growing into a minivan?

The xD looks like it was designed by a committee instructed to use existing sheet metal stamping dies.

xB and xD get poorer gas mileage and cost more. This is not progress, Toyota.

Pride Goeth Before a Fall

In the 1970's I worked for Digital Equipment Corporation (DEC).

The DEC mini-computers were wildly successful, management celebrated as genius, and product delivery and training backlogs reached 24 months.

The unsinkable DEC became incredibly arrogant, blindly hitting the personal computer iceberg and disappearing.

I think the same may happen to many of today's success stories.

Faltering Scion could signal icebergs ahead for unsinkable Toyota.