Was Scion a Successful Companion Brand for Toyota?
Motor City Blogman
Jim Farley was not too pleased with a February 2003 column I wrote for Motor Trend magazine, criticizing his plans for Toyota's new youth-targeting companion brand, Scion. I suggested that it was superficial market-speak to separate the emerging "millennials" from the baby boomers and Generation X.
Scion's conceit was that its customers didn't want to be "sold to," talked down to, or treated badly in dealerships. I objected, writing that we old fogeys didn't want that anymore than tech-savvy young Internet surfers do.
Anyway, the brand launched well. It didn't mention age or youth and eschewed traditional media outlets in its marketing and advertising. After my column appeared, Farley told me Scion's target market aspired (as do many people of my generation) to BMWs. He expected xA, xB, and tC owners would trade right up to Lexus models, skipping Toyota Camrys and Corollas altogether. In markets like Silicon Valley, many probably did, which may have helped Lexus take second-place in U.S. sales among luxury brands, behind BMW.
The original plan, to never repeat a model, worked until it didn't. Scion was to never replace the Toyota bB (xB) with the Toyota Rukus/Corolla Rumion (second-generation xB). By now, though, Farley had left for Ford Motor Company, and Toyota and its Daihatsu subsidiary were running out of appropriate models that could meet federal requirements and market demands, and so Scion became as product-starved as General Motors' Saturn.
Perhaps Toyota should have pulled the plug after sales peaked in 2006, the year before Farley's departure. The brilliance of companion brands is they don't have to last; the automaker spends money on badges, federal certification, unique sheetmetal in the case of the tC, perhaps move the steering wheel to the left side, plus some advertising and marketing, while dealerships spend a bit extra on facilities, including possibly separate showrooms. Companion brands can come and go as trends wax and wane.
General Motors' Hummer (1998-2010) should have been a companion brand. If GMC dealerships had made room for Hummer, it would have been easier to phase out when its brand perception went from war hero/tough guy "cool" to gas-guzzler anachronism.
Companion brands go back to Alfred P. Sloan, who found himself running the ever-expanding GM in the Roaring '20s. The pioneer of planned obsolescence, car model years, and "a car for every purse and purpose" needed to fill the space in purse and purpose between Chevrolet and Oldsmobile. Herewith a brief history of companion brands, including some conclusions about Scion. Tip of the hat to "The Standard Catalogue of American Cars 1805-1942" (by Beverly Rae Kimes and Henry Austin Clark Jr.) and "-1976-99" (by James M. Flammang and Ron Kowalke), "75 Years of Pontiac Oakland" (by John Gunnell), and "80 Years of Cadillac LaSalle" (by Walter M.P. McCall) for filling in the historic blanks in my memory banks.
Pontiac was Sloan's solution to the Chevy-Olds gap, of course, and long outlived its parent, Oakland (1907-1931). Beginning in 1933, straight-eight Pontiacs competed with Ford V-8s (Chevys were six-cylinders only through 1954), but there remained a narrow margin between Pontiac and Olds. GM famously put Bunkie Knudsen in charge of Pontiac in 1956, the year of its first V-8, and told him to "fix it or kill it." Knudsen gave us the wide-track 1959 models, the Bonneville to compete with the Buick Electra, the '62 Grand Prix, and John DeLorean added the '64 GTO and '67 Firebird. But these cars hinted at GM's growing problem: that Chevy, Pontiac, Olds and Buick were competing with one another as much as with other automakers. It worked only as long as GM had half the U.S. market share. Even before GM killed off the F-body in 2002, there was no sporty Pontiac that couldn't be badged a Chevy SS model.
Placed between Buick and Cadillac in Sloan's proliferation plan. Harley Earl's first GM design was the 1927 LaSalle 303 Roadster, a more rakish, "custom"-bodied, youth-oriented Cadillac for young investors who were making killings on Wall Street. By the '30s, LaSalle's V-8 models were wedged between Buick's straight-eights and Cadillac's V-8s, V-12s, and V-16s. In 1941, Cadillac rebadged its entry-level models with its own name to compete with the new 1941 Packard Clipper and the Lincoln Zephyr, a modern single-nameplate strategy that luxury brands use to this day.
All Oldsmobiles were sub-$1,000 six-cylinder models when Sloan wedged this V-8-powered, $1,595-$1,695 companion brand between Buick and LaSalle. "The Standard Catalogue" says the stock market crash ended the brand with just 7,224 cars assembled.
Another victim of Black Tuesday on Wall Street, this Buick companion was slotted between Olds and Oakland in price. With a top speed of nearly 70 mph, according to "The Standard Catalogue," the six-cylinder Marquette was perhaps an earlier iteration of the "banker's hot rod" Buick Centurys and Regal GNXes. Production totaled 35,007, all for one model year.
De Tomaso (1971-'74)
Nearly a decade after Enzo Ferrari spurned Henry Ford II's advances, Lincoln-Mercury dealers sold Ford V-8-powered De Tomaso Panteras in the U.S. Wonder how many of them were garaged next to a Mercury Grand Marquis.
Sold in select Lincoln-Mercury dealerships in the U.S., the turbo-four-powered European Ford Sierra XR4i became the Merkur XR4Ti. The V-6-powered Scorpio four-door sedan was sold during the 1988-'90 model years. Though Merkur became a cult classic among enthusiasts, Ford never convinced contemporary European-oriented buyers it could build a BMW as well as BMW. Sales peaked at 15,261 in calendar 1988.
The 1984-'88 Suzuki-built Sprint, Isuzu-built Spectrum, and '86-'88 Chevy Nova assembled at the GM-Toyota NUMMI joint-venture factory in California all became Geo-badged models for 1989. The Isuzu-sourced Tracker cute-ute was also added. Sales of "Chevrolet imports" peaked at 196,777 in calendar 1994, according to "The Standard Catalogue," but that was more than a decade before Chevy had any decent homegrown small cars it could upsell to customers who came in to look at the Geos.
I haven't walked into a Toyota dealership either as a customer or adviser-friend to a customer since before it launched the youth companion brand. But if the Scion showroom-within-a-showroom experience has improved the way Toyota-brand salespeople treat customers, it will have been worth it. Beyond that, the first Scion xB was a small, capacious, funky hatchback counterpoint to huge, overwrought truck-based SUVs of its era. The early tCs are best known for conquering the more expensive Acura RSX. I expect dealerships will sell a lot of Toyota 86 badge packages to FR-S owners, and in two decades, the Scion brand will be as easily remembered as Geo.