The Toyota Corolla, an aging, stodgy but reliable economy car, is getting a radical new look.
The world's largest automaker was rolling out a new version of the compact Thursday night at a splashy event in Santa Monica, Calif., hoping to shed the old version's low-cost image and attract new, younger buyers to its brand.
The 2014 version, which goes on sale in the fall, is longer and sits lower than the old car, with a sculpted, athletic look that's much closer to a sports car than the econobox it replaces. It also gets a new transmission, suspension and interior that Toyota says will make the car quieter and more luxurious, with better handling than the current version. It's the 11th generation of a car that Toyota has been selling worldwide since 1966.
"It's a huge car for us. It helped really identify the company and the brand and what we're all about," said Bill Fay, group vice president of the Toyota Division in the U.S. "We should appeal to a little younger buyer and broaden out the appeal of the car to more than what it is today."
The car's bold design is unusual for Toyota, which in the past changed its cars little with updates. But the new version is badly needed by Toyota. The Corolla, with a reputation for sterling dependability, is still America's top-selling compact. But dealers have had to cut its selling price and offer big discounts to compete against sleek new versions of the Honda Civic, Ford Focus and Hyundai Elantra.
"They clearly here are saying 'we've got to give the Corolla more personality and more life,' given the way the competition is," said Tim Calkins, a marketing professor at Northwestern University. "I certainly understand why they are pushing it here."
It's the first update for the Corolla in five years, but even with updates, the car's looks really haven't changed much in the past decade. And during that time, competitors have been throwing money into their compacts, giving them leather interiors, touch-screen systems, new transmissions and powerful yet efficient engines.
All have taken a bite out of a segment that once was ignored by Detroit and dominated by Honda and Toyota. In the past, all it took was a decent, reliable car to gain buyers, but industry analysts say every competitor is reliable and companies have to set themselves apart with style, fuel economy or performance.
Toyota wouldn't say how much it will charge for the new Corolla, nor would it release fuel economy numbers, other than to say an eco version should get over 40 miles per gallon on the highway. The current version starts around $18,000 with an automatic transmission, and Fay said Toyota's goal is to keep the new version close to that price.
The new version will certainly get better gas mileage than the current car, which fell toward the back of the class with an estimated 34 mpg on the highway due in part to an outdated four-speed automatic transmission. The Civic, Corolla's closest competitor, gets an estimated 39 mpg on the highway with its five-speed transmission. With more gears, engines generally don't have to work as hard at freeway speeds.
Toyota is offering two engines in the latest version, a 1.8-liter, 132 horsepower four-cylinder that carries over from the current model, and the same engine with new valve technology that adds eight horsepower to reach 140. The newer engine comes only on the Eco version.
The base engine is less powerful than the Corolla's main competitors. The Civic has 140 horsepower, while the Focus has 160 and the Elantra is rated at 148.
Toyota is giving the new version a continuously variable transmission that has seven "shift points" that mimic a conventional automatic. CVTs don't usually shift gears, instead allowing the engine to operate efficiently at most speeds.
The new Corolla also is nearly four inches longer than the current version, and that means more interior room in both the front and rear seats so passengers are more comfortable, Toyota says.
With the more radical styling of the new car, Toyota runs the risk of turning off longtime buyers who are used to a more conservative look, Northwestern's Calkins says.
But Tom Libby, lead North American analyst for the Polk automotive research firm, said traditional Toyota buyers are extremely loyal, and the risk of chasing buyers away is small. "The propensity of a Toyota owner to stay with the Toyota brand is pretty high relative to other makes," he said.
The Corolla is still America's favorite compact. Toyota sold 104,517 of them this year through April, beating the No. 2 Civic by more than 5,800 cars. But Toyota has paid a price to get those sales. The Corolla's average selling price of $18,464 is the lowest of the five top-selling compacts, and it sells for almost $1,600 less than a Civic, according to the TrueCar.com auto pricing site. And Toyota is second only to Ford's Focus in discounts per car at $2,072.