Toyota's new subcompact will use Mazda's Skyactiv engine

[Kal-El]

There's certainly a possibility that the transmissions will be shared. Would make sense to mate the same transmissions with the same engine across models. Remember also that the platform itself is being shared.

You do have to wonder why Toyota is going this route in the first place. Toyota sells more small cars world wide than any other company. There's numerous options for Toyota to use for a North American subcompact. They would "simply" need to outfit a factory in the US or Mexico or even Canada to build it. Building the Yaris in Japan and shipping it here is why it makes no money. Why would they need to use a tiny company (compared to Toyota) to build their subcompact? I'd expect this to be the other way around (Toyota building Mazda’s subcompact).

[why?]

Originally Posted by Kal-El

There's certainly a possibility that the transmissions will be shared. Would make sense to mate the same transmissions with the same engine across models. Remember also that the platform itself is being shared.

You do have to wonder why Toyota is going this route in the first place. Toyota sells more small cars world wide than any other company. There's numerous options for Toyota to use for a North American subcompact. They would "simply" need to outfit a factory in the US or Mexico or even Canada to build it. Building the Yaris in Japan and shipping it here is why it makes no money. Why would they need to use a tiny company (compared to Toyota) to build their subcompact? I'd expect this to be the other way around (Toyota building Mazda’s subcompact).

Yea, but Mazda already had the factory and the ability to make the engines. That is cheaper than building an entire new factory, plus Toyota has shared parts with almost every single other car company at one point or another. I'm surprised they are even bothering though, it would make more sense to keep the Corolla and the Prius C as the bottom of the line. That is unless the new car's price can go back to reasonable again.