New Toyota MR2 rumored to launch in 2026 with 400 horsepower and all-wheel-drive fun

Discussions about the long-rumored next-generation Toyota MR2 are getting more detailed and widespread

Petrol fans are always chasing more driver-focused cars, and one that has always been at the top of their wish list is the long-discontinued new generation Toyota MR2. After years of speculation about its return, the latest rumors suggest Toyota may finally be doing more than just brainstorming.

Sources say they have finalized the engine, drivetrain layout, and possibly even a production date. If these rumors are true, we could see a 400-hp all-wheel-drive MR2 as early as 2026.

To be fair, rumors have been swirling ever since the MR2 ceased production 17 years ago and the third-generation model was retired in 2007. But just last year, Toyota launched the FT-Se (pictured), an electric sports car with some serious MR2 vibes in its design and proportions.

Earlier this year, we heard that a new rear-wheel-drive MR2 was coming, possibly with an engine similar to the one in the GR Corolla. Well, that’s obviously changed — but let’s not forget that we’re still deep in rumor territory, so take it all with a grain of salt.

MORE: Toyota thinks its upcoming turbocharged four-cylinder engine could outperform the legendary 2JZ

According to Japan’s BestCar, Toyota is currently planning to produce the next generation MR2 all-wheel drive model. On top of that, it will use a next-generation 2.0-liter turbocharged four-cylinder engine that produces nearly 400 horsepower (298 kilowatts) on the street and up to 600 horsepower in motorsport. The engine will apparently be mounted amidships, and the entire vehicle will likely end up selling for about $70,000.

All of this sounds very much in line with what Toyota might want to do with its technology. The auto giant has confirmed that it is developing a turbocharged 2.0-liter engine. The company is working with Mazda and Subaru to build this new powertrain, along with a new 1.5-liter engine.

On top of that, Best Car says its sources say the car will launch in some form in 2026. If true, it would give us another non-hybrid, non-electric, mid-engine sports car option—a rarity in today’s market. While it may sound a little crazy, Toyota is somewhat bucking the electric vehicle trend that many other companies are following.

In fact, Toyota Chairman Akio Toyoda made headlines late last year when he said people were “finally seeing the reality of electric vehicles.” All of this suggests that the small-displacement MR2 is likely to be approved for production. Does Toyota have the ability to compete in a segment that includes the Porsche 718 and Lotus Emira? Only time will tell, but we can’t help but support more cars like this.