Toyota showed off a lot of interesting stuff at the 2025 Tokyo Auto Salon, but the displays and information from the Gazoo Racing division were clearly the most exciting. For one, a software upgrade for the GR86 was revealed that improves accelerator response (and, Toyota says, thus improves downshifts in manual cars), an aero package prototype for the awesome but forbidden-to-U.S. GR Yaris, and a bunch of motorsports parts for both cars that can be purchased separately. But the highlight, for us, is the GR Yaris concept seen above. Look closely—that’s an engine in the back! And it’s not the GR Yaris’ typical I-3, either; it’s a brand new motor, and this is its first known application.

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Toyota first discussed the new 2.0-liter I-4 back in May, revealing it to be a more compact, efficient, and powerful alternative to the familiar 2.4-liter turbo engine family that is found in all sorts of current Toyotas and Lexus products, such as the Toyota Tacoma, Land Cruiser, Grand Highlander, RX, and others. That sounds great, but it turns out this isn’t just a consumer-grade engine for trucks and SUVs. Toyota will plop it into a GR Yaris, the M Concept, and send it out in the Super Taikyu racing series to prove itself in competition.

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Nor will it be mounted up front, like the current GR Yaris’ turbo I-3 (and our American-market, delightfully unhinged GR Corolla with the Yaris' same engine). Instead, in the tradition of batpoop-mad rally cars of yore, the old I-3 is scooped out of the engine compartment, and the new I-4 and its attendant transaxle are plopped in the back. Instead of an engine, that nose compartment now houses the “rear” differential. Basically, it’s like Toyota dropped the GR Yaris’ drivetrain out the bottom, turned the car around, and bolted it back together.

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Not to minimize the engineering challenges at all. In addition to making the powertrain fit and send power to the opposite wheels as originally intended, you also have to make the thing handle. But given how hilariously great the GR Corolla is, we think that a smaller, more powerful, mid-engined, all-wheel-drive hatchback assembled from similar bits would have to be that much better.