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Toyota expects tC to boost Scion, but not as much as first thought

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Toyota expects tC to boost Scion, but not as much as first thought

Mike Colias

Automotive News -- September 15, 2010 - 4:29 pm ET

DETROIT -- Toyota expects its redesigned Scion tC coupe to double sales and breathe new life into the struggling youth-focused brand, Scion's vice president said today.

Scion expects to sell 35,000 to 45,000 of the more-powerful coupes in 2011, vice president Jack Hollis said during a media briefing at Oakland University in suburban Detroit. Scion sold 18,000 tCs in 2009, down 56 percent from the year before, after peaking at 79,125 in 2006.

Hollis' latest forecast is lower than a 40,000 to 50,000 estimate he gave in March, Bloomberg News reported today.

There's much riding on the rollout of the redesigned tC, which will arrive in showrooms Oct. 1. The tC has accounted for about 41 percent of Scion's overall sales since its launch six years ago. Sales of the coupe have continued falling this year, down 36 percent through August, to 8,848 vehicles.

Hollis said the slide is typical for a sporty subcompact car late in its product life cycle. He also blamed unemployment among the tC's core demographic -- median age is 26 -- that is nearly double the 9.6 percent national average.

“I think we're kind of timed right for this, where hopefully the unemployment rate will turn here at the beginning of the year,” he said.

More horses

The second-generation Scion tC coupe, first unveiled at the New York auto show in April, gets a 2.5-liter engine that will add 19 hp from the previous version. Zero-to-60 times for the six-speed manual transmission (7.6 seconds) and six-speed automatic (8.3) will be about a second faster.

Scion also widened the tC's track and lowered its floor for better handling and added brake assist, vehicle stability control and other safety features. The tC's starting prices of $18,995 for the manual and $19,995 for the automatic, including shipping, are nearly $1,200 higher than those of the outgoing model.

Hollis said he believes the 2011 tC can capitalize on a relative dearth of fresh competition in the market for entry-level coupes.

“We're moving into a sport subcompact segment where you really haven't had a new entry in a couple years,” he said. He cited the Kia Forte, which debuted this year, as the redesigned tC's closest competitor.

Marketing blitz

Scion is backing the launch with the biggest marketing campaign in its history, featuring TV commercials -- including spots on ESPN's “Monday Night Football” -- as well as street-level marketing that has been a staple of the brand.

Scion dealers are hopeful the 2011 tClives up to the hype.

Alex Islas, sales manager at Precision Scion of Tucson, Ariz., said tC sales are down more than 50 percent in the last 18 months, a plunge he blames on a lack of marketing and a perceived staleness of the product.

“It has kind of became the stepchild. It just sits there,” Islas said. “But there's a considerable amount of excitement for this remodel.”

Billy Rinker, general sales manager at Toyota Santa Monica near Los Angeles, said he likes what he's seen of the new version.

“We think performance and designwise, it's excellent. We couldn't be more excited,” he said.

Liz Halabu, a 19-year-old college sophomore who wandered by as Hollis was showing off eight gleaming 2011 tCs, was disappointed. She recently bought a 2010 model.

“Now I'm mad,” said Halabu, whose family owns four tCs. “If I had known this was coming out, I would have waited.”

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100915/OEM04/100919903/1291#ixzz0zhtlHj1s

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State of Scion: What's next for the original alternative-rock car brand

By GREG MIGLIORE

“This is gonna be awesome!” the spiky-haired guy in the Scion video screams, epitomizing in five words the enthusiasm the youth-oriented brand has tried to stand for over its seven-year history.

But now there's competition. It's not enough to make quirky cars and market them to the alt-rock generation. Nissan has the Cube. Honda has the Element. The xB was once the iconoclast. Now Kia, of all companies, has an entire lineup of vehicles built on that off-beat personality.

The man with the spiky hair then appears. Now he's traded his sunglasses for a pinstriped suit, purple tie and cufflinks. When he's not appearing in videos, Scion vice president Jack Hollis is clearly more formal, though the former minor-league baseball player still has a trace of California in his voice.

“Scion is nontraditional, it's an underground brand,” he says, pointing to the diverse makeup of its customers and their median age of 37, by far the youngest in the car business.

Except, somewhere along the way, Scion became a bit more of the establishment as other carmakers entered the fray with unconventional stylings and impressive arrays of technology. When Scion launched in 2002, most of its current tC buyers couldn't drink legally and were barely old enough to vote. The iPod craze--to be followed by the iPhone and iPad--hadn't yet revolutionized technology and culture. And the idea of talking to your car with something called Sync was still five years away.

Fast-forward to fall 2010.

Fewer cars are being sold. The economy is in tatters compared with previous booms. The people in Scion's target market have fewer jobs and less money. Some may be living in their parent's basements.

So, what's next for the brand?

Scion has two new products set to roll out in the next four months. The tC is expected to provide a sales jolt, with projections of 35,000 to 45,000 in 2011. It's joined by a small car called the iQ in January, which takes aim at urban buyers with its diminutive size.

The tC is a solid upgrade compared with its predecessor, offering a new four-cylinder engine found in the Toyota Camry that makes 180 hp, up 19 hp from last year's model, and 173 lb-ft of torque (11 lb-ft more). There are new transmissions, with a choice of six-speed automatic or manual gearboxes, an upgraded suspension and beefier brakes. Scion calls this the second generation of the tC, though the cosmetic changes are fairly subtle, with the rear end getting a more aggressive appearance. About 30 percent of buyers are expected to take the stick.

The sound system kicks with 300 watts and eight speakers, plus a choice of three head units. The tC gets an improved interior with larger seats, and the steering wheel is sporty and fitted with quality materials.

It's a solid car. But Hollis is candid, saying Scion can't stop there. Generations X and Y were among the initial Scion buyers, but older Gen Y members are well past 30 now--more suburban enclave than underground. Scion is already turning its sights to Generation Z, which is in middle school at the moment.

“We need to take more risks,” Hollis says. “The youth of today don't need a car for their social life.”

But at some point, they will need a car. And Hollis is trying to figure out how to make it a Scion.

Read more: http://www.autoweek.com/article/20100916/CARNEWS/100919918#ixzz0ziC9rA3L

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