Toyota (NYSE:TM) has shown a remarkable ability to take over market niches. By the early 1980s, the Japanese automotive giant was renowned for its utilitarian Camry, the perfect car for mom, dad, and their 2.5 children. The Camry continues to dominate that arena; it was the best-selling passenger car in the U.S. in 2004.

In 1989, the company launched its Lexus luxury line. Today, the Lexus RX 330 is one of the most popular cars in the luxury segment. Now, the company is engaged in yet another round of conquest and, again, things are going remarkably well.

The Toyota Scion brand, which is targeted at younger buyers, is expected to sell 140,000 vehicles in 2005, the company announced Monday. The new forecast represents a 20,000 vehicle increase from the company's projection in January and a 41% jump from last year's sales volume. Toyota is actually on track to sell 150,000 units, but production constraints will prevent it from reaching that target, according to Bloomberg. Not bad for a brand that is just 2 years old.

The new figures show that Toyota is connecting with the younger set in a big way. The success is in no small part due to Toyota's sustained effort to make Scion the "it" brand with youthful customers through, among other things, some innovative marketing. All this work may seem a little strange, given that the Scion is a low-priced and likely low-margin brand for the company. Nevertheless, as Toyota continues to extend its leadership in the U.S., the Scion may represent the most potent weapon in its arsenal.

At this point, no one needs to be told that Toyota is eroding the market shares of Ford (NYSE:F) and General Motors (NYSE:GM). But as Toyota captures the youth segment with its Scion, it stands to accelerate its progress by keeping those customers' loyalty as they age. If Scion commands the youth market, the future will belong to Toyota.

Also see: Toyota's Other Scion.

Fool contributor Brian Gorman is a freelance writer in Chicago. He does not own shares of any companies mentioned in this article.