If you are looking for the absolute peak of modern automotive development madness, Toyota's Gazoo Racing (GR) division is currently putting on a masterclass.For months, the automotive world has been buzzing with rumors about a new mid-engined Toyota sports car. The immediate assumption across the industry was that Toyota was quietly plotting the rebirth of the legendary MR2. However, a massive new exclusive from Carwow's Mat Watson, who recently went to Japan to test Toyota's top-secret development mules, suggests something entirely different.Forget the MR2. Toyota is building a 400-horsepower, all-wheel-drive, mid-engined monster—and all signs point to it being the triumphant, radical return of the Toyota Celica.AdvertisementAdvertisementHere is exactly what Watson discovered behind closed doors at Fuji Speedway and the Shimoyama test courseThe "M Concept" Test BedAutomakers normally lock their sports car prototypes in hidden facilities for years. Toyota's GR division is doing the exact opposite. They are currently testing their mid-engine powertrain in plain sight, hiding it underneath the chopped-up body of a GR Yaris.Dubbed the "M Concept," this test mule features Toyota's brand-new 2.0-liter turbocharged four-cylinder engine (internally named the G20E) mounted directly behind the front seats."This is the new Toyota Celica, and it will blow your mind," Watson explained, introducing the heavily modified chassis. "It's a mid-engine sports car with over 400 horsepower, and we should see it arrive on sale in 2028"AdvertisementAdvertisementPutting an engine in the middle of the chassis screams MR2, but the actual drivetrain math doesn't add up for that nameplate."The MR2 has always been rear-wheel drive, not all-wheel drive," Watson noted, pointing out the major discrepancy. "And I've spoken to some insiders at GR, and they hinted that while nothing has been confirmed yet, the Celica name for the mid-engined all-wheel drive car is more likely".This makes perfect sense when you factor in the legendary Celica GT-Four rally cars of the 1990s, which were famous for their all-wheel-drive dominance on gravel and snow."Rotate, Rotate, Rotate": The Akio Toyoda InfluenceThe origin story of this layout didn't come from a boardroom spreadsheet; it came directly from the racetrack.AdvertisementAdvertisementToyota Chairman Akio Toyoda (who famously races under the pseudonym "Morizo") operates on a brutal testing philosophy that forces his engineers to constantly evolve their hardware."Every day I drove GR Yaris, every day I broke it, and every day I fixed it, and next day I broke it," Toyoda explained during a rare trackside interview regarding his hands-on testing approach.During his track sessions in the standard front-engine GR Yaris, Toyoda reportedly wanted a car that would instantly rotate in the corners rather than pushing wide. The engineering team's ultimate solution to eliminate that front-heavy understeer was to move the engine to the middle of the car.During Watson's ride-along on Toyota's demanding Shimoyama test course, the difference in chassis dynamics was violently apparent.AdvertisementAdvertisement"Right, this is different straight away, and it's sliding straight away," Watson yelled from the passenger seat of the M Concept. "This is wicked, it's like constantly rotating".Compared to the standard layout, the mid-engine weight distribution completely changes the cornering entry. "Like when the other car was pushing, this is rotating… no push, it's just rotating".Test, Break, Fix, RepeatPerhaps the most fascinating element of the M Concept is how Toyota is choosing to refine it. Rather than using sterile wind tunnels, Toyota actually entered the mid-engine prototype into the Super Taikyu 24-hour race at Fuji Speedway to battle-test it under extreme stress.While the M Concept finished at the back of the pack, the goal wasn't to win the race—it was to find the car's breaking points as part of GR's overarching ethos.AdvertisementAdvertisementEngineers noted that while the M Concept was actually faster on the straights than the standard GR Yaris race cars, its mid-engine layout made it incredibly twitchy. The team will spend the next few years dialing in that suspension geometry to find the perfect midpoint between a hyper-aggressive rotating track weapon and a drivable road car.If this 400-horsepower, mid-engined, all-wheel-drive weapon truly is the next-generation Toyota Celica, the 2028 model year cannot arrive fast enough.
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