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2014 NYIAS Scion Pickup Update – Obstacles Remain

At the 2014 New York International Auto Show, we had the chance to talk with Scion Vice President Doug Murtha about the much rumored Scion pickup. It is still on the table although a new trade pact could determine its fate. Here is what we know.

NYIAS Scion Pickup Update - Obstacles Remain

The much rumored Scion pickup’s fate is tied, in part to, a global trade pact.

Before we get to the pickup, Scion is getting a rebirth of sorts. Murtha told Autonews, three of the five Scion products will be replaced in the next two years. These new products will be unveiled in NovemberĀ at the 2014 Los Angeles Auto Show. None of these vehicles will be truck based thanks to the so-called Chicken Tax and its 25 percent tariff on light pickups. Yet, the tariff could be coming to an end.

Trans-Pacific Partnership

Currently, the future of the Chicken Tax is one of many discussion points between negotiators of the Trans-Pacific Partnership. The trade pact involves 12 countries with 40 percent of the global economy. Japan and the U.S. are having separate ongoing discussions around resolving long-running trade disputes like the Chicken Tax. Japan wants the Chicken Tax removed like it is with the North American Free Trade Act with Mexico and Canada. The U.S. is concerned about ramifications to U.S. manufacturing and Ford, GM and Ram truck production.

The ongoing negotiations are getting a push this week with President Obama making a Japan state visit on April 25 and 26. Negotiators have said they want to have many items worked out before he arrives. Other items include agricultural trade concerns.

Economics of Scale

Once the Chicken Tax is gone, Murtha said they would still have to deal with economics of scale. For example, Scion couldn’t build a pickup without a sales goal of around 100,000 units. Selling fewer vehicles than that doesn’t translate into a profit and doesn’t make sense from a business standpoint. However, with a new trade pact, the Scion pickup could be sold in multiple markets and hitting the 100,000 unit level could be easier.

Many parking lots in Manhattan have started using a multi-level system to increase capacity. This may not look like "truck" country, the need for a truck exists. Albeit a smaller one like a Scion or Tacoma.

Many parking lots in Manhattan have started using a multi-level system to increase capacity. This may not look like “truck” country, but the need for a truck exists. Albeit a smaller one like a Scion or Tacoma.

While in New York City, it was easy for us to see the need for a compact truck. Parking, driving and using a full-size truck in the city is ridiculously difficult. While the truck areas of Texas, California and the Midwest may scoff at the idea of a small, mini-El Camino, city dwellers would certainly drive demand. The need to haul groceries, garden improvement items (soil, plants, etc.) and other items like bicycles still exists in cities. A compact truck is the ideal solution.

In the end, the need for a smaller truck is hard to really judge. Yet, with the potential end of the Chicken Tax, we could be driving one before you know it.