Toyota Australia has dropped a bombshell, announcing the new Toyota 86 hero car will cost just $29,990.
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Read CarAdvice's review of the Toyota 86.

The razor sharp price is for the entry level GT model, while the luxury GTS version will come in at $35,490.

These prices are for the six-speed manual version of both grades. Toyota will charge an extra $2500 for the six-speed automatic, which is available for both the GT and GTS.

CarAdvice reported exclusively earlier this year that the Toyota 86 would be cheaper than a $38,490 VW Golf GTI three-door, while rival sites have continued to speculate a circa-$40K figure, though the sub-$30,000 starting point is unexpected considering the company had said it was hoping to begin pricing with a '3'.

While the 86 was jointly developed with Subaru, there is no word yet on where that company will position its BRZ version. It is very likely that the Subaru Australia is waiting on the announcement of the 86 pricing before locking in its final position.

The base 86 GT model has cloth seats, manually controlled air conditioning, cruise control, seven airbags, five-stage Electronic Stability Control and traction control (which can be turned off completely) and 16-inch alloy wheels. Tilt and telescopic steering wheel adjustment is also standard, along with Bluetooth phone connectivity, voice recognition, CD sound system with AUX and USB input, information display, a folding rear seat back, electric folding wing mirrors, a full size steel spare wheel and a rear foglight.

Stumping up the extra cash for the GTS adds leather-accented front seats with alcantara (with heater function), dual-zone climate control air conditioning, a six-inch information display screen with satellite navigation, aluminium-look pedal covers, LED daytime running lights, auto-levelling HID headlights and 17-inch alloy wheels.

It also includes smart entry and start (using a transponder key), front foglights, carbonfibre-look trim sections for the interior, a frame-less rear-view mirror, a digital speedo, full-size alloy spare wheel and paddle shift buttons on the steering wheel for the automatic version.

The manual GT, manual GTS and automatic GTS get a limited slip differential, but the automatic GT misses out.

Both cars have the same engine and transmission combination. The GT and GTS also have front ventilated disc brakes, but the discs are different sizes: the GT has 277mm diameter fronts and 286mm rears, while the GTS has 294mm diameter fronts and 290mm rears.

Toyota has also revealed the 86 is covered by the Toyota capped-price servicing plan, which means the first four scheduled services will cost $170.

The company says it was determined to make the 86 as affordable as it could.

“The 86 is meant to be enjoyed by as many driving enthusiasts as possible, and our pricing will extend its appeal to people who never imagined they could afford such a fun car,” says Toyota Australia marketing manager Matthew Callachor.

Toyota 86 chief engineer Tetsuya Tada added: “We developed an authentic sportscar so that ordinary people can experience the joy of exciting driving.”

The pricing of the 86 means it dramatically undercuts every possible logical rival. It is significantly cheaper than Volkswagen’s Golf GTi at $38,990 and Subaru’s turbo WRX at $39,990, the Mazda3 MPS at $39,490 and Renault Megane RS at $41,990.

Toyota has also confirmed the 86 will be reasonably efficient, with an official average fuel consumption figure of 7.8L/100km for the manual, while the automatic version drives the number down to just 7.1L/100km. The emission numbers stand at 181g/km for the manual and 164g/km for the automatic.

While it promises to be fun to drive, the 86 is not a straight-line weapon, with a 0-100km/h time of 7.6 seconds for the manual. The automatic takes an extra 0.6 seconds.

It is nice and light, with a kerb weight of 1222kg for the base specification car.

The 2.0-litre boxer four-cylinder engine, which is based on a Subaru design with Toyota direct injection technology, generates 147kW at 7000rpm and 205Nm between 6400 and 6600rpm.