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Toyota's rise in becoming the world's second largest automaker has been marked by the excellence of its luxury Lexus line and hybrid engine program, but this new, second-generation Yaris is a solid reminder that Toyota earned its way into this elevated position by building good, basic transportation.

The Toyota Yaris, however, is better than just good. This replacement for the unloved Toyota Echo boasts the good looks, suave road manners, perky performance, and well-tailored interior that establish new benchmarks in the entry-level game. And this will cause the increasing competition in that market many sleepless nights figuring out how to offset Toyota's deep well of talent, materials, and technology.

The Yaris combines the economies of an inexpensive sticker, outstanding fuel mileage, and the solid integrity that underlies every Toyota vehicle. Sure, certain aspects of the car, such as noise isolation and driving position, are far from ideal, but the Yaris owner will never feel as though he or she had to settle for second best, even if they didn't have to pay much to get the best.

The first generation of Toyota Yaris has been sold in Europe since 1999 and became Toyota's best seller there, and it also won many honors, including the 2000 Car of the Year. However, the Yaris that's coming to America is built off an all-new platform, and whereas the first Toyota Yaris was offered only as a three-door liftback, America's traditional indifference to the body style means we will also get a four-door sedan in the line-up.

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The Toyota Yaris is available both as a three-door hatchback ($10,950) and four-door sedan ($11,825). Just one level of liftback is being offered, but the sedan can also be ordered as a sportier S model ($13,325).

All Yaris models are powered through the front wheels by a small but sophisticated 1.5-liter engine with an output of 106 horsepower. A five-speed manual transmission is standard while a four-speed automatic is optional.

Despite being the least expensive Toyota-badged car sold in America, the Toyota Yaris boasts generous standard equipment and interiors that appear to be tailored for more expensive models. Because the liftback and sedan were designed separately, there are minor differences in such areas as interior trim and materials and dashboard layout, but each is similarly equipped with such standard items as air conditioning, power steering, a tilt steering wheel, intermittent wipers, rear center headrest, driver and passenger vanity mirrors, front and rear cupholders, digital clock, UV glass, and a map light. Differences are few: The liftback's front seats are adjustable four ways, while the sedan's chairs are adjustable six ways, the radio antenna is roof-mounted on the liftback and is placed in the rear window glass of the sedan, and the liftback's rear seat folds down while the sedan's rear seat is fixed.

The standard running gear consists of P175/65 R14 radials on 14-inch steel wheels, and the brakes are front ventilated discs and rear drums. The suspension is independent in front and torsion beam in the rear.

The Toyota Yaris sedan S package adds an AM/FM/CD player with MP3 capability and MP3 input jack, a 60/40 split fold-down rear seat, rear defroster, P185/60R15-inch radials on 15-inch steel wheels, and revisions to the exterior styling via a front under-bumper spoiler, rear under-bumper spoiler, side rocker panels, and unique badge.

Optional packages include a Convenience Package for the sedan that adds the AM/FM/CD stereo with MP3 capability and input jack, 15-inch wheels and tires, rear defroster, and 60/40 split/fold-down rear seats. The liftback's Convenience package is similar but does not include the split rear seats and adds a rear wiper.

The Power Package for the liftback contains anti-lock brakes, power locks/windows/mirrors, 60/40 slide/recline/fold multi-function rear seat. Options which can be ordered along with this package include anti-lock brakes, 15-inch alloy wheels, a rear spoiler, fog lamps and remote keyless entry. The sedan's Power Package includes anti-lock brakes, power locks/windows/mirrors, cruise control, unique interior trim and a tachometer (this also requires the Convenience Package). Additional options include 15-inch alloy wheels, a rear spoiler, fog lamps, remote keyless entry and an engine immobilizer.

Safety features include dual-stage driver and front passenger airbags, front seatbelt pretensioners, plus three-point seatbelts and head restaints for all five seating positions. Also available are front seat-mounted side-impact airbags for torso protection and side curtain airbags for head protection for front and rear passengers. We highly recommend these extra safety features, especially in such a small and lightweight car. Always wear seat belts as they are your first line of defense in a crash. Anti-lock brakes are optional for both models; ABS helps the driver maintain steering control in a panic stop.