TOKYO — If you've recently read a story or two about the delay, or even the demise, of the compact sport coupe that Toyota and Subaru are jointly working on, don't believe it. That's the message from knowledgeable PR sources in Japan, who tell Inside Line that this intriguing sports car program is still very much on track.

Last April, Toyota and Subaru confirmed they were working on a new compact, rear-wheel-drive sport-coupe project for 2011, the car the industry has since fondly come to know as the "Toyobaru."

To be built by Subaru and based off a new Subaru-developed platform (converted to rear-wheel drive), the sports car will also run with Subaru's prized boxer 2.0-liter engine. There will be both Toyota and Subaru versions of the car, each looking different but with the same normally aspirated flat-4 engine under the hood.

Japan's influential Nikkei business newspaper ran a headline story in December, meantime, claiming that in the wake of the severe market meltdown, the Toyobaru was being postponed.

Toyota and Subaru had decided to delay the start of production, the paper claimed, with production now "likely to be postponed to 2012 or later."

Both representatives from Toyota and Subaru's press offices in Tokyo have recently denied the story. "The project is still on track, according to the info I have on hand," says a Toyota spokesperson.

What has changed is the production site. The original idea was for Subaru to build a completely new factory in Oizumi, in Japan's Gunma prefecture, to build the car. But the economic crisis has now prompted Subaru to can that project, so the Toyobaru, when it is built, will be made inside Subaru's long-serving Gunma main plant, which is now due to be refurbished.

REPORT: Toyota reviving Celica name for joint Subaru RWD car


The last report about the on again/off again sports car being developed jointly by Toyota and Subaru was that it's on again. Today comes word from L'Automobile in France that not only is the rear-wheel-drive Toyubaru going to happen, but it will arrive bearing the Celica name sometime in 2010. If Wikipedia is to be believed, this would be the eighth generation of the Celica, which traces its roots all the way back to 1970 when it debuted in Japan as an inexpensive rear-wheel-drive sports car. Through the years it switched to front- and all-wheel drive, with the final seventh generation Celica sold from 2000 - 2005 being a strict cart puller. L'Automobile claims that Thierry Dombreval, Toyota's VP of sales and marketing in France, spilled the beans on reviving the Celica name, so we won't consider this news solid until a second source comes forward or Toyota officially confirms it, neither of which is likely to happen. So for now all you Celica fans should just sit tight and light a few candles for your cause.