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Rumor had it that Toyota sent the Corolla back to the drawing board once it got a glimpse of the new Civic last year. There's been no news since there. Motor Trend seemed to get its hands on what could be next gen:

http://www.motortrend.com/future/spied_vehicles/112_0509_2008_toyota_corolla/

Personally, it reminds me too much of the late and definitely not lamented Echo.  

geez, toyota really needs to find a new designs for some of their cars...

the echo, the prius, the yaris, the matrix = ugly  

it looks to tall and short, but its just a sketch so, who knows could have some potential.  But nothing like the design of the new civic.  Which in my opinion is beautiful  

Granted this is probably very preliminary.  Nonetheless, if this is what the next Corolla will look like then it's just average.  For one thing, it reminds me to much of the Yaris, with that little bulge stemming from the protruding Toyota logo, and the face in general is just too similar to the wimpy Yaris.  The backside looks unfinished, much like today's Saturn Ion sedan.  On the bright side, the wheel arches provide an agressive stance never incorporated into previous American Corolla's, the nose is a nice take from the tC, and would you look at those handsome Z4-looking headlights!  It's ok, probably will be just as rock-solid in reliability, but it won't beat the Civic.  But it won't quite lose to it either.  

it looks like the front end of the prius, the back looks like a hatchback with a trunk sticking out of the rear, i hope the real thing doesnt loook like this thing  

I agree with the list!  

okay, for outside appearance the Honda is pretty sweet, the dash is something else. What is up with a seperate digital gauge for the speed and what is the point of having an RPM tach in the centre ? It seems that Honda is trying to grab at speed and sporty rather than praticality. I did test drive the new Corolla. Not bad. Tried and true.  

I agree.