Toyota's next MR2? GR Yaris M Concept returns as 400 hp mid-engined AWD coupe – or is it a Celica?

Unveiled at Okayama International Circuit during the October 24–25 weekend, the revised prototype retains the familiar GR Yaris headlights and taillights, but features an almost entirely new body and heavily revised chassis.

Originally introduced at the 2025 Tokyo Auto Salon, the M Concept was developed to test Toyota's new G20E 2.0-litre turbocharged four-cylinder engine, mounted behind the passenger compartment.

Almost 200 mm lower, and barely a Yaris anymore

Image: Car Watch

According to Japanese publication Best Car, Toyota has lowered the M Concept by nearly 200 mm while extending its wheelbase by approximately 100 mm.

The changes weren't simply cosmetic. Earlier prototypes reportedly suffered from a relatively high centre of gravity, unpredictable handling at the limit and aerodynamic issues caused by the hatchback roofline.

Airflow wasn't reaching the rear wing effectively, while heat management was also causing problems during prolonged driving.

Image: Car Watch

Toyota's solution was to redesign the body, lower the roof and improve cooling. The result just happens to look rather like a dedicated mid-engined sports car.

Interestingly, Toyota's engineers still insist it's a GR Yaris, despite how little of the original car appears to remain.

New G20E turbo engine produces around 400 hp

Image: Car Watch

The M Concept continues to use Toyota's new 2.0-litre G20E turbocharged four-cylinder engine, reportedly producing approximately 400 hp in its current development form.

The revised cooling system has helped address the heat-related power loss experienced by earlier versions.

Unlike the original MR2, however, the M Concept features all-wheel drive, with Toyota experimenting with different torque distributions.

According to Best Car, engineers have found that an approximately 20:80 front-to-rear torque split delivers particularly enjoyable handling.

Toyota chairman Akio Toyoda, also known as Morizo, has personally tested the car. The development team is apparently aiming for a driving experience where throttle inputs play a greater role in controlling the car through corners.

It hasn't been entirely straightforward, either. Japanese rally driver Norihiko Katsuta reportedly found the prototype challenging to drive initially.

Still, there's progress. Car Watch reported a best lap of 1:37.231 during Friday practice at Okayama, although comparisons with previous events aren't necessarily representative due to differing conditions.

MR2 or Celica? There's evidence for both

The mid-engine layout, compact coupe proportions and focus on handling make the MR2 an obvious candidate.

After all, every previous MR2 generation used a mid-engine, rear-wheel-drive layout, and the nameplate hasn't been in production since 2007.

But some Japanese publications have also suggested a connection to the Celica.

According to Best Car, the M Concept has undergone gravel testing and uses MacPherson strut suspension at both ends. Together with its all-wheel-drive system, these details bring to mind the rally-inspired Celica GT-Four.

There are also visual similarities between the M Concept and Toyota's coupe-shaped rally development prototype spotted earlier this year.

Could Toyota be developing components for both an MR2 and a Celica? It's possible, particularly with the G20E engine being developed for broader applications, but there's no official confirmation.

Toyota hasn't announced a production version of the M Concept, let alone its eventual name or launch date.

Still, this latest evolution suggests the project is progressing well beyond simply fitting a new engine into an existing GR Yaris.

Whether it becomes an MR2, a Celica or something else entirely, Toyota's experimental 400 hp mid-engined AWD coupe is certainly one worth keeping an eye on.