Toyota plans accessories to bolster Scion sales

LAS VEGAS, November 7, 2002; Alan Ohnsman writing for Bloomberg reports that Toyota Motor Corp. plans to bolster sales of its bbX, the first of the Scion models aimed at young people, by offering accessories such as red steering wheels and metal dashboards to tap growing demand for customized cars.

The world's third-biggest automaker added Scion to its Toyota and Lexus brands in March, targeting buyers in their 20s to expand Toyota's customer base, Scion Vice President Jim Lentz said. The 40 accessory options offered on the bbX, which goes on sale in California in June 2003, is expected to add revenue by appealing to the desire among young people to personalize their vehicles.

The customers Scion targets want "the option of unlimited possibilities for self-expression, especially with purchases that reflect their personalities," Lentz said at a Las Vegas press conference. The bbX's box shape and accessories were chosen to appeal to a niche market.

Toyota and rivals General Motors Corp., Ford Motor Co., DaimlerChrysler AG and Honda Motor Co. are expanding in the market for parts bought after vehicle sales, known as the aftermarket.

Sales of car and truck accessories are forecast to increase to $30 billion in the next five years from $26 billion now, according to the Specialty Equipment Manufacturers Association.

Automakers hope exhaust and suspension options, modified dashboards and pedals, spoilers and custom paint jobs can lift profits as they have for Harley-Davidson Inc., which for decades complimented motorcycle sales with revenue from chrome parts and clothing.

Sales strategy

To distinguish Scion cars from standard Toyota vehicles the company will install separate sales booths within existing Toyota shops equipped with accessory displays and computer screens so customers can model and review customization choices, Lentz said. So far about 80 percent of Toyota's California dealers, or about 133 shops, have signed up to sell Scion products, Lentz said.

Scion will add two more models by June 2004, when the company expects to begin sales in most major U.S. cities. Toyota, which hasn't said how much it's investing in Scion, expects to sell about 100,000 Scion cars annually by 2005. The base model will cost $16,000, though the company expects to add thousands to the sales price through sales of accessories.

Toyota's American depositary receipts, which each represent two ordinary shares, fell 46 cents to $51.75 at 4:01 p.m. in New York Stock Exchange composite trading. The stock has gained 1.6 percent this year.