2023 Toyota Corolla Hatchback XSE Review: A Fun Little Man

Looking around the dealer lots these days, there are plenty of trucks, crossovers, and SUVs to choose from. So many, in fact, that you soon notice the dearth of new sedans, coupes, wagons, and hatchbacks, especially on the low end of the budget scale. The U.S. automakers ceded this ground to the rest of the global automotive scene a while ago, preferring to mine as much gold as possible from the ongoing boom before it one day busts.

One of the few remaining players making hatchbacks of any size is Toyota, which recently turned their otherwise-chill Corolla Hatchback into the track-day special known as the GR Corolla. That ride comes in three editions, including one — the Morizo Edition — where the rear seats get chucked aside to make more room for 100 pounds of lightness and a bump in torque from 273 lb.-ft. to 295 lb.-ft. to the corners (plus a set of whatever race-ready tires and wheels are brought to the track).

Of course, the GR Corolla isn't for everyone, and it's a limited-edition piece, as well. For those without a competition license, the regular Corolla Hatchback offers plenty of fun on its own without that 300-horsepower hardcore turbo-three putting the fear of your deity of choice into your heart. But how much is that plenty, though? That's what I set out to discover in my week with the 2023 Toyota Corolla Hatchback XSE, the top-tier trim of this agile little man.

The 2023 Toyota Corolla Hatchback is the latest in a lineage of Corolla hatchbacks dating back (in the U.S. market, anyway) to the fifth-generation Corolla introduced in 1983. This generation not only included the last rear-driven Corollas ever made (the AE85 Levin and AE86 Trueno), but delivered the three-door, front-wheel driven hot hatch known as the FX16 GT-S, whose 16-valve 1.6-liter inline-four made 108 horsepower. Despite the fun the FX16 offered, neither it nor the five-door hatches were a big hit among U.S. consumers. Thus, the hatchback went away at the start of the sixth-generation Corolla's first appearance in showrooms for the 1988 model year.

Toyota

Fast-forward to the waning days of Toyota's youth-focused sub-brand, Scion. The last new model to carry the Scion badge prior to its dissolution in 2016 was the Auris-based iM, which went on sale in 2015 for the 2016 model year. Upon the death of Scion, the iM became the Corolla iM for the 2017 model year, a name it would bear until its replacement in March 2018 by the current Corolla Hatchback. 

Not much was changed with the new Corolla hatchback, aside from a smaller undercarriage shield to make replacing the now-spin-on oil filter easier at the local Valvoline Instant Oil Change shop. Sales in the U.S. peaked in 2017 at 20,501. Toyota still believed in a Corolla hatchback for the U.S., leading the automaker to introduce the 12th-generation Corolla in hatchback form at the 2018 New York Auto Show prior to launching the new generation as a hatchback first for the 2019 model year.

The Corolla FX16 had the 4A-GEC 1.6-liter inline-four. The Scion iM/Toyota Corolla iM moved the front wheels with the 1.8-liter 27R-FAE 16-valve inline-four, which is still used on the non-hybrid sedan version of the 12th-generation Corolla. For the Corolla Hatchback, the SE and XSE trims come with a bigger inline-four, the 2.0-liter M20A-FKS "Dynamic Force" engine. And how much "dynamic force" does the 2.0-liter provide? A grand total of 169 horsepower and 151 lb.-ft. of torque, all going exclusively to the front pair of 16- (SE) or 18-inch (XSE) alloys.

This all-aluminum alloy engine, introduced with the Corolla Hatchback in 2018, was developed for use with Toyota's New Global Architecture platform, and also powers the likes of the current C-HR, Camry, RAV4, Lexus UX 200, and Lexus ES 200. The new "Dynamic Force" engine family promises improved driving performance while also delivering excellent fuel economy along the way. It is refreshing to see the engine without a plastic cover, one of a few engines across manufacturers opting to expose its guts to the world rather than hide them under a pleasant — though not always loved — molded shroud.

As for how the power gets to the road, there is one transmission available: the K120 "Direct Shift" CVT, which possesses a physical first gear for launching off the stoplight, plus nine simulated gears that pick up where first gear leaves off once the Corolla Hatchback is up to speed. The six-speed manual was discarded for North American version of the Corolla in June 2022 for the 2023 model year (except for the GR Corolla, which uses either the EA67F or EA68F six-speed manual, depending on the edition chosen).

Step into the 2023 Toyota Corolla Hatchback, where there are some cool features awaiting you. The first, which confused me at first until I turned to YouTube to explain it to me, is the always-on cruise control. Instead of pushing the cruise control symbol down on the dial to activate cruise control, you can switch between regular cruise control and adaptive cruise control. 

You also get wireless Apple CarPlay and Android Auto on an 8-inch touchscreen on all trims, wireless charging, and a 7-inch TFT gauge cluster on the XSE trim (SE trim has a 4.2-inch multi-information display and no wireless charging), and either a six-speaker audio system or an eight-speaker JBL premium audio system. And of course, the Corolla Hatchback comes with a ton of safety features via Toyota Safety Sense 3.0, including automatic high beams, road sign assist, lane departure alert, and pre-collision with pedestrian detection.

Cameron Aubernon/SlashGear

One thing I unfortunately discovered was my inability to see what the OEM navigation looked like. As you can see above, you'll need to subscribe to Toyota's connected services in order to make use of the OEM nav. Those connected services include Service Connect, Safety Connect, Drive Connect, Wi-Fi Connect and Remote Connect. The first two are standard on both trim levels as a 10-year trial, while Drive Connect — the one with the navigation — is available on a 1-year trial before asking for $15/month. 

As vehicles last longer on the road, manufacturers are looking to make money through service subscriptions ranging from heated seats (BMW) to extra horsepower (Mercedes-Benz). The question, then, is whether consumers will either protest such strategies, or begrudgingly accept them as time moves forward.

No matter whether you choose the SE or XSE, the 2023 Toyota Corolla Hatchback has plenty offer as far as comfort goes, with some differences to make each trim stand out just a bit. On the XSE I drove, the seating for five is draped in SofTex with fabric inserts, the front seats of which are heated and come with sport bolstering. The driver gets eight ways to adjust their seat, the front passenger just four ways. 

Both trims share a leather-wrapped steering wheel, lots of storage, automatic climate control (the XSE gets dual-zone control), and a couple of USB 2.0 charging ports and a 12V auxiliary port. You can even remotely start the Corolla Hatchback SE and XSE with the Smart Key System remote keyless entry system. This Corolla's no ultra-basic econobox hatchback, that's for sure.

Cameron Aubernon/SlashGear

Hatchbacks by their nature are handy for most of life's errands, and all without the bulk and size of nearly crossover and SUV (not to mention their fuel economy numbers). This Corolla Hatchback XSE is equipped with the XSE Package, including a set of roof cross bars (a $298 option) for carrying anything that can't fit in the backside of the compact (or things you wouldn't want in there, like a painter's ladder). With the 60/40 bench up, there's 17.8 cubic-feet of cargo space for all the groceries you can carry from Whole Foods. Drop the bench down, and there's 23.0 cubic-feet of room for IKEA runs and visits to the big box electronics store.

Draped in two-tone Blue Crush Metallic with a Midnight Black Metallic roof, this 2023 Toyota Corolla Hatchback XSE was a joy to drive. The visibility out of the windshield is up there with my own 1997 RAV4 despite the wide gulf between the glass and the driver. It handled every turn down from my usual photo stop like the sporty little man it is. Fuel economy was excellent, as well. Rated at a combined 33 mpg (30 city, 38 highway), my in-town driving topped out at 26.7 mpg, in line with the city MPG rating. It's not going to light up the dragstrip or the track — that's the GR Corolla's job — but it will leave a smile on your face on every errand run and big road trip.

The only real problem I found — aside from the subscription navigation surprise — was not with the vehicle itself, but with the wireless charging. For some reason, my iPhone repeatedly lost its connection with the Qi pad, as noted by the blinking orange light. Moving it around fixed it for a moment, only for the connection issue to come up again. Perhaps the pad wasn't as grippy as it should have been to keep my phone in place, as I haven't experienced this issue with other Qi-equipped vehicles.

The 2023 Toyota Corolla Hatchback XSE is a breath of fresh air amid the giants on the road today. It's not the barnburner the hot rod GR Corolla is, but it's not meant to be. The Corolla Hatchback is a fun machine with plenty of versatility and tech for anyone to enjoy. The price of admission isn't too bad, either: starting MSRP for the SE is $23,155, $26,580 for the XSE, $28,613 as-tested. 

The one major ding is the subscription-based tech packages. There's too much uncertainty with that business model, especially once an automaker decides to terminate the services down the road. What happens to a given vehicle then? Does it become completely useless? Will there be an aftermarket ready to crack open everything permanently locked away after the servers are shut down? Those thoughts can take some of the joy away from car ownership, especially with a car as otherwise fun as the Corolla Hatchback.