Insider: Toyota-Subaru joint RWD could be on sale in Europe by 2011

The Big 3 Detroit carmakers have been capturing the world's headlines with their economic and product woes for the past several months, but the truth of the situation is that the whole industry is struggling. Toyota recently announced its first operating loss in 71 years, and then decided to push back development on its RWD sports car joint project with Subaru. But the project, feared dead, is in fact still simmering. According to an anonymous project planner on the sidelines of the Geneva Motor Show, the car would be on European streets by 2011.

Developing the information further, the source told Automotive News that the car would sit in about the same market space as the old Celica used to occupy. Subaru's parent company, Fuji Heavy Industries, has been working with Toyota on the development of a new RWD sports car for about a year now, but the continuing soft market and poor 2009 outlook led the companies to shelve work on the car. Saving production costs in a cash-strapped market is part of the reasoning, but also introducing a new car right now would almost certainly doom it to sales failure.

Another reason for the delay is the need to add D4S direct injection to the car's boxer-four for better power and efficiency, Toyota told the press at the Tokyo Auto Salon last month. The car's chassis and body development are finished, with the project bearing the code-name '086A' - a possible nod to the classic AE86 Corolla/Trueno that the joint project has been compared to so often.

But the Toyota-Subaru joint project isn't alone. All new production projects are being reviewed in an effort to help realign investment and development budgets with newly reduced profit forecasts. Last November the Japanese carmaker cut its future profit figures by 56% thanks primarily to poor sales in Europe and the U.S.

Earlier reports had pegged the 086A to begin production in March, 2012. Original plans had previously put the car's launch in late 2011, branded as a Scion in the U.S. The price target for the car is still intended to make the ¥2,000,000 mark, though whether it will sell in the U.S. for the equivalent $21,300 is up for debate.