The Toyota Corolla family tree is complex. In the U.S., it spawned the Matrix, while the Corolla stayed a sedan. In Europe, the hatchback that split off from the Corolla line became known as the Auris (while the larger Avensis sedan spawned the U.S. market Scion tC). So, it's all a bit incestuous, but the Auris hatchback is now finding its way to America as the Scion iM, and as sort of a spiritual successor to the now-departed Matrix.
The bottom line is that the Scion iM will be a Corolla hatchback for the U.S. market, for all intents and purposes. The only available engine is an undersquare 1.8-liter 2ZR-FAE inline-four making 137 hp and 126 lb-ft of torque—essentially, it's an updated version of the Corolla's base engine, and it's also used in the Corolla "Eco" trim, where bizarrely it makes 3 more horsepower than in the iM.
Two transmissions are available: a 6-speed manual and what Toyota calls a "7-speed automatic" but is really the company's CVTi-S continually-variable transmission. Those 7 virtual speeds are preset stepped ratios that can be actuated with manual selection on the console shifter. No flappy paddles for iM owners, thank you very much.
There's better news on the suspension front—the Corolla's inexpensive rear torsion beam has been replaced with a sportier double-wishbone setup in the iM, with front MacPherson struts and stabilizer bars front and rear. Unlike its new little sibling, the iA, it has disc brakes all around, and sensible 17-inch alloys are standard.
The iM is no featherweight. It's loaded-up Corolla siblings are all south of 2900 lbs., while the lightest iM clocks in at 2960 with the manual. The CVT rings in at 3045 lbs. Cargo volume isn't listed, but it appears to be reasonably generous even with the 60/40 folding bench seat in the up position.
All in all, the iM is shaping up to be a more competent, more functional, and marginally sportier Corolla. There aren't many wagons in this price range—around $20,000, Scion says—available with a proper manual. This is one of them. It'll have some fierce competition in the form of the Mazda 3 and Volkswagen Golf hatchbacks, though—the former starts at $18,945, and the latter $17,995, albeit with less standard equipment than the iM.