Quote:
Originally Posted by Havsie
Profits are the sole objective in every business. You are listing premium brands that make significantly higher profits than Scion. Scions are sold at the lowest possible prices with a no haggling policy at an attempt to cater to younger consumers. .
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This is a very simplistic view of how business (especially multinational automakers) run in today's world. Yes profit is the sole objective of an overall company. In the auto business (and many others) how that profit is achieved almost never laid on one marque (especially a niche brand like Scion). Scion is intended to give Toyota a presence that its' primary brand hasn't served in perhaps two decades. You are correct in identifying young buyers. Toyota doesn't view it's brands in a "one size fits all way", but more as a progression of products for people to grow into. Most automakers operate in this manner.
In the U.S. Honda has Acura, Nissan has both Datsun and Infiniti, VW has countless brands that include Bugatti, Lamborghini, Audi, Ducati, and many more brands. Ford, General Motors, Fiat/Chrysler, and internationally the list goes on and on. This is not by mistake. Profit is far from the sole purpose of opening, operating and/or acquiring a business.
There are many examples of this in other businesses just one example is Google with YouTube. YouTube was purchased for $1.65 Billion and is speculated to have cost Google billions over the years in annual operating costs. Google refers to YouTube's operating expenses as "not material" because YouTube's value isn't in how much profit it generates. YouTube dominates its niche and helps to drive membership into other Google services.
Toyota hopes that Scion does something similar. To get young buyers to purchase a Scion, then step up to a Toyota (or Prius if it ever becomes a "brand") when they need something more practical or larger (for a family). Eventually Toyota hopes those now older buyers end up in one of their bigger profit autos (like a big SUV) or marques like a Lexus. Scion introduces young buyers to Toyota where they were previously starting with Honda, Nissan, and GM because previously Toyota offered little to appeal to them.