After owning my Scion xB for 16 years from day one Chicago salt finally attacked my car. In particular the fender rocker area on the driver side.

I have three options:
1. I picked up a fender with the same paint but has a bad dent. I could fix it up with bonding. But the panel is after marker and seems not as strong as OEM.
2. Trim the existing fender back to remove rusted metal, cut off the bottom part of the replacement fender and wedge it in the existing fender.
3. Fill up the hole with foam and bondo. The plastic fender liner will help shape it.

If I were to do option two or three should I trim it horizontally (A) or diagonally (B)?

What would you do?

One more detail. The reason why I was unaware of the rust is because it’s mostly covered up by a plastic side skirt. After fixing the rusted area the skirt will be placed back and mostly cover it.

 

If you plan on keeping the car why not do it right? Options 2 and 3 are pretty 'hack' in that they're going to, more than likely, be noticeable and provide more places for water, salt and road debris to get trapped. You'd be fixing it again in pretty short order.

Why not look for an OEM fender at a local 'pick and pull' or get one off eBay...you might even be able to find one in the same color as your xB and maybe even without being 'pre-dented'. If it were my car I would look for an OEM piece, even if it had to be painted, and make sure I got all of the rust out because it'll just keep 'growing' if you don't.

 

Speaking as one who lives in the heart of the rust belt, I can feel your pain. To fix it right, I'd also recommend finding another OEM fender. (Yes, aftermarket parts fit like crap.) Even if you have to get it painted, it'll still be a far better looking and longer lasting repair.