Frugal Chic

Having conquered nearly every vehicle segment, Toyota Motor Corp. looks at one of its most important launches of 2006, the all-new '07 Yaris subcompact, as a chance for redemption from one of its few genuine gaffes.

On sale in April at a starting price below $13,000, Toyota would like the snappy Yaris — the second generation of the nameplate that won Toyota respectability in the European subcompact market — to erase memories of the profoundly dull Echo.

The Echo was based on the first-generation Yaris that took Europe by storm, but nobody here wanted that car. Toyota pitched the Echo amid the nation's love affair with cheap gas and Big-Gulp SUVs. Sales slid to a laughable 3,899 units last year.

Now, just in time for the new national consciousness about fuel economy, Toyota (as well as Honda Motor Co. Ltd. and Nissan Motor Co. Ltd.) are launching all-new subcompact fuel-sippers in the U.S.

There remains doubt as to whether Americans will embrace these subcompacts with more love than befell the Echo.

The Yaris will be sold in the U.S. as a 4-door sedan and a 3-door liftback, and both are more smartly styled than the white-bread Echo. But the 3-door liftback is truer to the edgy European-market favorite. Indeed, Toyota says it was sculpted at the company's European design studio.

The sedan, however, is expected to account for 70% of the ambitiously projected 70,000 first-year sales.

Subcompacts desperately need better styling, but equally important is price and fuel economy. Because what Toyota — and Honda and Nissan — really is up against is not just a populace averse to anything small but also the South Koreans, to whom the Japanese and U.S. auto makers essentially have ceded this segment. The best seller in the sector in the U.S. is the Chevy Aveo, a rebaged Daewoo.

The Yaris should be at least passingly competitive with the growing multitude of Hyundais and Kias, as is the fuel economy of 34 mpg (6.9 L/100 km) in the city and 40 mpg (5.9 L/100 km) on the highway for 5-speed manual cars. Either body style with a 4-speed automatic does 1 mpg (0.4 km/L) worse on the highway.

Sending all models down the road is the same variable valve-timed 1.5L DOHC 4-cyl. Toyota already employs in the Scion line.

It makes 106 hp and 103 lb.-ft. (140 Nm) of torque — not numbers that imply neck-snapping progress, but this mill is eager enough. It sounds coarse only when floorboarding the throttle to accelerate to highway speeds, and it does not hurt to be armed with the 5-speed manual that just 15% of buyers are likely to choose.

The Yaris sedan is shorter than the Echo by a couple of inches, but in all other major dimensions the Yaris is roomier.

Its grown-up role is best evidenced by the wheelbase of 100.4 ins. (225 cm), nearly 7 ins. (18 cm) up on the Echo. The 3-door hatch's wheelbase is 96.9 ins. (246 cm). And it is 19 ins. (48 cm) shorter overall than the Yaris sedan.

There are two shared trim levels, CE and LE, while a sporty-ish S trim tops the sedan lineup. Air conditioning, a tilt steering wheel and a host of other amenities are standard, but one has to step up for a convenience package to get power windows/locks and cruise control. Antilock brakes cost extra.

There are many thoughtful touches, including rear seats for the 3-door that slide fore-and-aft to provide a degree of cargo/passenger flexibility.

The Yaris interiors are handsome and acceptably rich in the context of the price. The steering, brakes and switchgear operate with a precise-and-tight fluidity the South Koreans have yet to master.

The Yaris is pleasing to drive, presentable to the eye and compatible with most budgets. Whether Americans will want it — and whether the Yaris and the new breed of subcompacts from Honda and Nissan can carve into the Korean auto makers' iron grip on the segment — will be one of the new year's more interesting storylines.