The Toyota Celica is edging closer to a comeback after nearly two decades away from the market, with Toyota developing an eighth-generation version of the iconic sports coupe. Production of the Celica ended in 2006 after seven generations spanning several decades. Toyota confirmed in November 2024 that it was working to revive the nameplate, when then-Toyota Vice President Yuki Nakajima said during Rally Japan: “We’re making the Celica.”

Since that announcement, additional signs have emerged pointing to progress on the project, including test vehicles spotted during development, as well as reports linking the upcoming sports car to the Gazoo Racing (GR) family and an all-wheel-drive system inspired by the Celica’s rally heritage.

2.0-Liter Turbo Engine Could Produce Up to 450 HP

One of the most significant developments surrounding the new Celica is Toyota’s G20E engine, a newly developed 2.0-liter four-cylinder gasoline engine featuring a turbocharger. The engine forms part of Toyota’s new-generation powertrain family and has appeared in test vehicles associated with Gazoo Racing projects.

Specialized reports suggest that the sports-car version could produce around 400 to 450 horsepower, while other sources have mentioned output exceeding 400 hp and torque of approximately 550 Nm.

However, these figures remain estimates and reports rather than official production specifications announced by Toyota for the Celica.

There have also been reports suggesting that versions of the engine could eventually produce significantly more power, potentially exceeding 600 hp in performance and racing applications. However, such figures should not be considered specifications for the road-going production Celica.

Will the New Celica Be a Hybrid?

This remains one of the key unanswered questions surrounding the project.

In March 2026, Autocar reported comments from Gazoo Racing marketing executive Mikio Hayashi, who said Toyota was considering a 2.0-liter engine because the 1.6-liter three-cylinder engine used in the GR Yaris may no longer be suitable for some markets due to emissions requirements. At the time, he also indicated that the company had not finalized whether the new model would use a hybrid or plug-in hybrid system.

As a result, reports currently point to different possibilities for the powertrain. Some suggest a 2.0-liter turbocharged hybrid system combined with all-wheel drive, while others indicate that Toyota could offer a conventional internal-combustion setup.

This means the final production powertrain has not yet been publicly confirmed.

All-Wheel Drive Revives the GT-Four Legacy

One of the most frequently reported details is that the next-generation Celica will use all-wheel drive (AWD), bringing back the spirit of the legendary Celica GT-Four and its rally heritage.

A Toyota spokesperson told Autocar that the company’s new sports car would use an all-wheel-drive system, while prototype vehicles associated with a new performance project have also been spotted during testing.

The Celica has a strong history in the World Rally Championship, with the GT-Four versions associated with Toyota’s rally successes during the 1990s. This is part of the heritage that Gazoo Racing is seeking to carry into the next generation.

Could Toyota Offer a Manual Transmission?

Some reports and leaks suggest that the new Celica could be offered with a six-speed manual transmission, alongside an eight-speed automatic gearbox.

However, Toyota has not yet officially confirmed this transmission lineup for the final production model.

Toyota’s continued focus on maintaining manual-driving technology within the Gazoo Racing family makes the possibility of a manual Celica plausible, particularly as the company continues developing performance-focused drivetrains and transmissions.

Two-Door Sports Coupe

Current reports indicate that the new Celica will return as a two-door sports coupe, preserving one of the nameplate’s defining characteristics despite potential changes to its engineering.

Some sources expect the model to join the GR family, potentially positioned below the Supra. However, Toyota has yet to officially confirm whether the production model will be called the GR Celica or Celica Sport.

There have also been reports linking the project to the next-generation Corolla from a platform perspective, but this remains unconfirmed and has not been officially announced by Toyota.

Strong Links to Gazoo Racing Projects

Development of the new Celica appears to be progressing alongside other Toyota and Gazoo Racing projects, particularly the G20E engine that has appeared in the GR Yaris M Concept.

Toyota is using this prototype to develop the new engine and explore drivetrain and performance technologies, while additional sports-car test vehicles powered by the new engine have been spotted undergoing development in Japan.

At the same time, Toyota is developing a new car for the 2027 World Rally Championship (WRC) season. Prototypes have appeared with a two-door coupe-inspired design.

Although Toyota has not officially confirmed that the WRC vehicle will be called Celica, reports have strongly linked the project to the name because of the Celica’s historic connection to rally competition.

It is important, however, to distinguish between the rally car and the road-going Celica. WRC regulations for 2027 allow different body styles, while the production road car could feature significantly different specifications from the competition vehicle.

When Will the New Toyota Celica Arrive?

Despite the frequent use of the name 2027, Toyota has not yet officially confirmed that the new Celica will be launched as a 2027 model year vehicle.

Recent estimates from several automotive sources suggest that the car could make its official debut during 2027, while some sources expect its market arrival to be closer to the 2028 model year.

These remain estimates rather than an official launch date announced by Toyota.

A Nameplate Absent Since 2006

Toyota discontinued the Celica after its seventh generation in 2006, following a history that began in 1970 and included several notable performance versions, most prominently the GT-Four, which combined all-wheel drive with a turbocharged engine.

The return of the Celica name is part of Toyota’s broader effort to strengthen its sports-car lineup, following models such as the GR Supra, GR86, GR Yaris, and GR Corolla, alongside other projects connected to the future of Gazoo Racing.

What Do We Know So Far About the New Celica?

What is confirmed is that Toyota is working on reviving the Celica nameplate, and that the sports-car project has progressed to the prototype testing stage. However, the final engine and production specifications have not yet been officially announced.

Current reports suggest that the new Celica could feature:

2.0-liter turbocharged four-cylinder engine

Approximately 400 to 450 horsepower

Around 550 Nm of torque

AWD all-wheel drive

A possible hybrid powertrain

A six-speed manual and eight-speed automatic, according to some reports

Two-door coupe body style

Possible market arrival in 2028

However, most of these figures and specifications have not yet been officially confirmed by Toyota, meaning they could change before the production car is formally revealed.

The New Celica Could Bring Back One of Toyota’s Most Iconic Sports Cars

If the reported specifications prove to be close to the final production model, the return of the Celica would give Toyota a significantly more performance-focused sports coupe than the previous generation, potentially combining higher output, all-wheel drive, and technologies derived from Gazoo Racing programs.

However, the most important details—including final power output, drivetrain configuration, hybrid or conventional powertrain, launch timing, and pricing—will remain unknown until Toyota officially unveils the eighth-generation Celica.

To stay updated with the latest car news and information, download the Dooz Cars app.