Also, Toyota designed the A series engine for the Tercel, attempting simultaneously to achieve good fuel economy and performance and low emissions.

The name "Tercel" was derived from the Latin word for "one third", with "tiercel" referring to a male falcon which is one-third smaller than its female counterpart.

All Tercels were assembled at the Takaoka factory in Toyota City, Aichi or by Hino Motors in Hamura, Tokyo.

[2] The Tercel was introduced in Japan in August 1978,[1] Europe in March 1979 (Geneva Motor Show)[4] and the United States in 1980.

Models sold in the US were powered by a 1,452 cc SOHC four-cylinder 1A-C engine producing 60 hp (45 kW) at 4,800 rpm.

This made for a taller package than usual, making the beltline higher as well, but Toyota felt that traditionalists might be scared off by a transverse setup.

[12] In August 1980, the Tercel (and Corsa) underwent a facelift, with considerable changes to the front and minor ones to the interior and rear.

[7] This engine eschewed the TGP lean burn design used on the 1A, instead depending on a catalytic converter to meet the ever more stringent emissions standards of the time.

In Japan, a four-wheel-drive sedan was also available; it, too remained in production alongside the wagon version even after the introduction of the third generation Tercel.

In Japan, power outputs were as follows: North American Tercels were all fitted with the 1.5-litre engine, producing 63 hp (47 kW) at 4,800 rpm.

The four-wheel-drive models (chassis code AL25, only with the 1.5 litre engine) could be equipped with six-speed manual transmissions, and could be shifted from two- to four-wheel drive without coming to a stop.

The EL gear generates a 17.6:1 final drive ratio, giving the driver the torque needed to extract the vehicle from conditions which otherwise may have trapped it.

Also included with better equipped four-wheel-drive models was an inclinometer above the radio and air conditioner that measures the tilt of the car.

There is no conventional center differential, so the four-wheel-drive system can be used only on loose or slippery road surfaces (such as snow, gravel, or sand); otherwise the drivetrain experiences severe wear, and handling is compromised.

This is not the same as the low-range power option found in a truck or conventional SUV, as the Tercel lacks a high-range-low-range transfer case.

In Japan, the top trim package Tercel Retra GP-Turbo came installed with Toyota's four wheel independent suspension, labeled "Pegasus", along with their "Lasre" branded multi-port fuel injection, using the 115 PS (85 kW) 3E-TEU engine.

[22] The wagon version continued to be of the previous generation, as did the four-door sedan (which was not exported to most countries), until it was moved to the Corolla's underpinnings in 1988.

The variable venturi carburettor reportedly has some problems, especially in the earlier models, such as a too rich mixture, which is caused by the too thin Teflon coating of the fuel-metering needle, which erodes over time due to friction.

Colour-keyed bumpers, full wheel covers and folded rear seat were optional on the DX, standard on the LE.

The 1993 model had a minor exterior redesign to the front and rear fascias and the addition of a standard driver's side airbag (the non-motorized two-point passive passenger-side seatbelt is retained) and available anti-lock brakes.

It was brought along the Canadian-spec Corolla to meet the new emission standard since no Latin American version of either was yet available with a catalytic converter.

Due to the higher trim level of the Canadian-spec versions, the Tercel was initially marketed as a successor of the Corolla E90, which had just been discontinued.

Designed between 1991 and 1992 by Shinichi Hiranaka and Yasuhisa Hamano, Toyota introduced an all-new Tercel in September 1994, for the 1995 model year.

The new Tercel featured a redesigned exterior and new engine, offering a stiffer body[citation needed] with better handling and was one of only a handful of cars in the US to have OBDII in 1995.

[30] In Japan, the Tercel was again also offered with the Corsa and Corolla II nameplates, for sale through parallel marketing channels.

The new 5E-FE engine gets 45 mpg‑US (5.2 L/100 km; 54 mpg‑imp) on the highway with a five-speed manual transmission, making it the most fuel-efficient four-cylinder car of its time in the United States.

[31] For 1997, all North American market Tercels were available only in the CE trim level and incorporated many of the standard and optional items from previous base and DX models.

The RedHawk and WhiteHawk editions were introduced in addition to the BlackHawk trim already offered, which came standard with air conditioning, 185/60R14 tires on custom wheels, a rear spoiler with integrated brake light, and hawk symbols to identify the special model.

The facelift occurred in December 1997 for the Japanese market, and covered all three lines (Tercel, Corsa, Corolla II).

The Tercel's rear styling was also enhanced with redesigned composite tail lights and updated bumper molding.