New Corolla takes shape: 2026 Toyota Corolla to bring improved hybrid and plug-in hybrid power to battle the Mazda3 and electric cars like the MG4 and BYD Dolphin

Toyota is preparing its new Corolla small car, which is expected to arrive in 2026.

The new Corolla is expected to bring some much-needed upgrades with new hybrid powertrains.

Japanese outlet, Best Car, has given us a glimpse of the new Corolla with some digital imaginings.

At the heart of the new Corolla is expected to be the new 1.5-litre four-cylinder engine, which is being developed along with a 2.0-litre unit.

These new engines are being prepared to better accommodate electrification and will be at the heart of the brand’s new range of vehicles.

The next-generation Corolla will be available with this new hybrid engine and is expected to boost power to about 110kW, up from 103kW.

Improved fuel economy is the main aim of these engines and the new Corolla is expected to beat its current 4.0L/100km range and reduce its CO2 emission.

This is a vital improvement as the New Vehicle Efficiency Standard (NVES), which sets CO2 thresholds in Australia and fines carmakers that miss it, starts to bite from 2027 onwards.

The new Corolla is also expected to be fitted with plug-in hybrid tech.

There has been speculation the Corolla could use plug-in hybrid tech borrowed from BYD, but that is becoming increasingly unlikely.

Instead Toyota could use an updated version of its plug-in hybrid system used in its Prius Prime and RAV4 Prime overseas and based on its new family of engines.

This means the 1.5-litre engine could be paired with a more potent electric motor and a circa-15kWh battery to deliver meaningful electric-only range.

BestCar reports the next-gen Corolla will be available in a range of body types including hatchback, sedan and wagon. 

Toyota isn’t expected to bring the wagon version to Australia with the majority of small-car buyers gravitating towards hatchbacks.

The current-generation Corolla first went on sale in 2018, so is due to be replaced in 2026. Keep an eye out for the reveal at the 2025 Tokyo motor show in October.