What's the difference?
This is probably the most important new car launch of the year.
The 2026 Toyota RAV4 needs to be bang-on exactly what customers want, because it’s not only Toyota’s most popular model globally, it was the most popular new car in the world last year.
It’s also Toyota Australia’s second-most popular model behind the Toyota HiLux the highest-selling non-ute in the nation.
Crucially, The HiLux has just been launched in a new generation albeit not a revolutionary change, and it somewhat overlaps with the generation changeover of the RAV4.
Toyota is also facing a significant sales dip, the first quarter of sales for the brand in 2026 is down 23 per cent compared to the same time last year. It’s a bigger dip than the industry as a whole, as its market share is down from 19.9 per cent to 15.7 per cent in the same periods.
The new RAV4’s launch must bring strong sales as the vast majority of the brand’s dip is thanks to the mid-size SUV’s changeover.
But as well as an influx of new competitors, the RAV4 must also contend with a lack of ANCAP safety rating for its first few months on sale.
Has Toyota done enough to convince Australia its family SUV is still worthy of its position as the best-selling passenger car getting around? We headed to its Australian launch in Tasmania’s north to find out.
There are around 30 different models fighting for your attention in Australia’s medium SUV segment. More than double that if you include premium options. In other words, there’s overwhelming choice.
Some of the most popular options include Toyota’s RAV4, the Mazda CX-5, Kia Sportage and Mitsubishi Outlander, with a bunch of Chinese brands climbing up the charts.
But have you ever considered a Mahindra? The Indian carmaker has been operating in Australia for close to 20 years and the product line-up has improved considerably.
Case in point, the MY25 Mahindra XUV700. A replacement for the unloved XUV500, it’s just come in for a refresh adding new interior trim and tech features and it’s still affordable.
But is it worth taking a chance on the up-and-coming brand? Read on to find out.
The RAV4 is undeniably better than the last generation, and brings with it a level of driving refinement the most popular car in the world should have.
It also levels up its tech without falling into the overcomplicated, messy systems newcomers to the market think will impress buyers. While the base GX is a sound option, the few extra mod cons in the GXL are worth the extra cash.
But its lack of ANCAP rating is surely a point of anxiety for Toyota, and while the safety systems seem sound, we can’t definitively say this RAV4 is as safe as Toyota claims it is.
If you’re willing to trust Toyota on that, you’ll find a very enjoyable car that’s uncomplicated and efficient. But if those five stars from ANCAP matter to you, give it a few months and see how the new RAV4 performs before you put your money down.
The Mahindra XUV700 is a solid, well-rounded family SUV. It has a practical cabin with a usable third row and a punchy turbocharged powertrain. The Indian manufacturer needs to address a few things like interior quality and some ADAS calibration and there’s more work to do when it comes to ride and handling. But overall this seven-seat SUV represents exceptional value for money against some pricier rivals and should be on more consideration lists.
Each RAV4 in the range is more visually distinct than before, but most variants feature a similar honeycomb grille that’s a departure from the ‘safe’ design language Toyota is known for.
The outlier is the Edge variant, which gets a more traditional front-end treatment as well as its 20mm wider wheel tracks to go along with the intended purpose of light off-roading.
Despite the fact Toyota has clearly tried not to change the new RAV4 too much in too many ways compared to the last generation (and why would you when it was already so popular), the new design feels a little more adventurous.
It includes elements of Toyota’s latest design language including the ‘c-shaped’ headlights and more streamlined tail-lights but retains the overall size and shape of the RAV4.
The RAV4 is 4600mm long, 1855mm wide and 1680mm tall, a very similar size to before and as such its interior feels similarly spacious.
Inside, the layout is tidy with a little more visual distinction for controls than the last-gen RAV4.
Updated, sleeker buttons and controls replace the ageing fixtures and large screens make the mid-size SUV feel much more up to modern standards.
The XUV700 is a reasonably handsome vehicle in the metal. It has a distinctive look that ensures it is immediately identifiable as a Mahindra. It is a clear evolution of the XUV500 it replaces, but far more coherent.
It has a typical SUV shape but in profile the bonnet looks short and it has a big glasshouse with a kicked-up window line from the C-pillar back.
Front on the unique headlights surround an appealing six-bar grille with the cool Mahindra badge front and centre.
The rear features stretched and pinched tail-lights and the XUV700 sits up high on the road.
Inside the cabin is neat and the dash has an uncomplicated layout. It’s not the world’s most visually appealing interior but it doesn’t get anything wrong. Although the steering wheel feels a bit cheap.
The lovely dark grey interior is broken up with a light grey upper half and there’s stitching on the seats, dash and steering wheel. There are plenty of piano black inserts but it's not overdone.
But despite the sleeker look inside the new RAV4, Toyota hasn’t fallen into the trap of shoving as many digital features into the system as possible.
Many newcomer brands create confusing digital environments by having menus upon menus filled with options and features, but Toyota has avoided this by retaining a simple, almost siloed system.
In the multimedia display, navigation, media, phone and settings are the key shortcuts visible down the side of the screen, though a customisable home screen allows you to make the system your own.
It’s far preferable to the many sub-menus and confusing layouts some manufacturers (especially newcomers) use, and means you’re able to focus on driving.
There are also still plenty of physical controls for the key functions of the car, no need to go into digital settings to sort your drive mode or climate.
The new system, dubbed 'Arene' by Toyota, is a much-needed update for the RAV4, bringing it into the current decade when it comes to tech.
Its voice command system is still a little too keen to interrupt, but the general function is extremely easy to get acquainted with.
The interior is also physically extremely sensible, with good vision and light thanks to a low dashboard and large windows, well-considered ergonomic positioning, comfortable seats and storage options.
The centre console storage bin lid is also able to be opened from either side, or removed and flipped between a hard plastic surface or cushioned elbow rest, though a bit of non-slip surface on the plastic side wouldn't go astray.
Behind the front seats, the second row passengers don’t have a massive amount of amenity, but are far from cramped. The vents, armrest with cupholder, bottle storage in the door and document holder on the backs of the seats are all quite standard, though the outboard seats are heated in the top spec Cruiser.
Behind that, a huge 705L of space in the boot includes a netted pocket if you opt for the Edge grade, plus there's a proper spare wheel under the boot floor. Wins all round.
The Mahindra boasts a versatile, practical cabin - not something all mid-size seven-seat SUVs can claim.
This grade has electric ‘smart’ door handles that pop out when the car is unlocked. They’re not super easy to grab and feel a little gimmicky.
The sunroof has a solid power-operated blind, unlike an increasing number of models that come with a flimsy sheer blind or no blind at all, which is unimaginable in our hot Australian climate. Thank you, Mahindra!
Another cool feature is the extendable sun-visors that are great at blocking out sun at the front or side, especially on longer drives.
A chunky rear centre headrest impedes rear visibility, but it is easily removed. However the rear outboard headrests are also big and that impacts vision out the large rear side windows.
Great to see Mahindra has retained physical controls for the air conditioning, although if you want to adjust anything digitally, you can via the central screen.
Sitting under that and the air vents are buttons for the reversing camera, hazard lights and other controls, then there’s a wireless phone charger, an extra little slot for your phone and two USB-A ports. No USB-C up front in the XUV700.
There’s decent storage up front with two compact, squarish cupholders in the console, a small central bin with a handy rubber key holder, while the glove box is a decent size and will fit more than just the manual.
Bottle storage in the front doors is excellent. The tall CarsGuide bottle fits easily and there’s extra storage for a bunch of other items.
The front seats are on the firm side but the side bolstering is good, helping you feel nicely secured. The base makes you feel like you’re sitting on the car rather than in it. There’s not a great deal of adjustability - you can’t extend the under-thigh cushion - but the Mahindra has Mercedes-Benz-style controls on the door.
The multimedia screen houses a lot of functions. If you tap the bottom of the screen the climate controls including seat heating pop up. There are more functions if you tap the top of the screen like sound, camera view and the like.
The multimedia screen homepage has tiles, one says ‘Fun in XUV700’ (for Android Auto, Apple CarPlay and radio) and the other says ‘Fun with XUV700’ (vehicle performance).
Driver assist functions are accessible via the driver’s instrument display using the steering wheel-mounted controls and you can change the intensity of cruise control and lane keep assist or turn off functions like traffic sign recognition and smart pilot assist.
There are a few cons up front. The indicator sound is awful and makes it feel cheap. There are some quality issues, like the flimsy panel to the lower right of the steering wheel that’s home to the auto stop-start. It feels like it’s going to fall off. And some of the fabrics don’t quite line up.
The device charger could do with a fan as my phone gets super hot charging on the pad, while the ‘Siri’ talk-to-text function of Apple CarPlay is patchy.
In the second row, the legroom is decent and while there’s not acres of room I don’t feel cramped sitting behind my 183cm (six-foot) driving position. A tiny transmission tunnel means good centre seat legroom. There’s a lever on the front passenger seat back allowing rear passenger behind to move that seat forward.
Headroom is also decent without being ample. There’s about an inch between my head and the roofliner.
The window line is low enough for small children to see out but not so low you feel like you’re sitting on the car.
The rear seating row is comfortable enough but the backrests - which recline - are flat.
You’ll find rear knee-level air vents, one USB-C port (the only ‘C’ port in the car) and a pair of map pockets, a phone slot under the vents, a centre armrest with two cupholders and loads of door storage for big bottles and more.
For child seats, the two outboard seats have ISOFIX anchors and there are two top tethers as well.
Access to the third row is much easier than I expected for a mid-size seven seater. The passenger-side single outboard seat tumbles flat then up, leaving plenty of space to get into the rear. There’s even a grab handle to assist.
Headroom isn’t great back there for me, but again, I am six-foot tall. A kid will be fine. There’s a surprising amount of legroom and toeroom.
Third-row occupants have access to cupholders and air vents on both sides, a fan speed dial, speakers and a 12-volt outlet that is also accessible from the boot when the seats are lowered.
The fact the curtain airbags cover the third row is a big tick. Overall, a solid third-row experience.
There’s a handy plastic lever on the rear of the seats to lower and raise the third row easily. They don’t quite fold flat into the boot floor so they sit up a little, but don’t intrude on boot space.
It looks like there is a cargo cover option but it wasn’t fitted to this example of the car. There are lots of hooks in the boot to hold bags, but note there is no power tailgate - it’s a manual operation in the Mahindra.
You also get a temporary spare wheel housed externally on the underside of the car.
One thing I can’t tell you unfortunately is the boot volume. Mahindra doesn’t provide those figures. I can say that when all three rows are in place, there is not much room behind the third row. Just enough for three backpacks or a few bags of shopping in a row. When the third row is lowered, there’s ample luggage space.
The RAV4 is more expensive than it was before. Of course it is.
That’s because it comes with more stuff, and it’s got new oily bits and more software to play with, plus everything gets more expensive anyway, right?
There are five trim levels, most with 2WD or AWD options and the base GX starts from $45,990, before on-road costs, in 2WD guise - a few thousand more than before.
Standard kit isn’t mind-blowing compared with a lot of newcomers to the market, but for an established model like the RAV4 it’s expected.
The GX (which can be had in AWD for $49,340) comes with 17-inch dark grey alloy wheels, LED headlights, dual-zone climate control, a 10.5-inch touchscreen display for multimedia, a 12.3-inch digital instrument cluster, fabric upholstery, six-speaker audio and five USB-C ports plus wireless Apple CarPlay and Android Auto.
If you opt for all-wheel drive, you also get downhill assist control and 'Trail' and 'Snow' drive modes.
Importantly, the RAV4 comes with a spare wheel, though on the GX it’s just a space-saver which costs $300 to upgrade to a full-sizer.
The $48,990 GXL adds 18-inch alloy wheels, privacy tinting, an eight-way powered driver’s seat, rain-sensing wipers and a wireless smartphone charger. That one’s $52,340 in AWD guise.
The Edge is $55,340, comes in AWD-only, and has its own front-end design plus 18-inch dark matt grey metallic alloy wheels on a 20mm wider track, plus a larger 12.9-inch touchscreen, premium trim, heated seats, illuminated entry and a power tailgate. It’s the variant Toyota says is more aimed at light off-roading than its siblings.
The XSE is also AWD-only and starts at $58,340, with 20-inch black alloy wheels, better LED headlights, a surround view parking monitor and two-tone paint. It also has synthetic leather and suede sports front seats with contrast stitching and three-stage front seat heating and ventilation, plus a sunroof. Front and rear bumpers feature integrated skid plates on the XSE.
The Cruiser is available as a 2WD from $56,990, or AWD from $60,340, and adds 20-inch machined black alloy wheels, high-grade LED headlights, leather-accented seat trim, a head-up display, digital rearview mirror, heated outboard rear seats, powered tailgate with kick sensor, another wireless smartphone charger and a premium nine-speaker JBL audio system.
The Mahindra XUV700 is offered in two model grades, both powered by the same petrol engine. It all kicks off with the AX7 from an affordable $39,990, drive-away.
The focus of this review is the AX7L which tops the range at $42,990, drive-away, which is still great value.
At this price the Mahindra undercuts most mainstream medium SUVs like the Toyota RAV4 and Mazda CX-5 and lines up more closely with the GWM Haval H6 and MG HS from China.
But unlike most of the mid-size SUV set, the XUV700 has a third seating row. The only other offerings in this category to boast that option are the Honda CR-V, Mitsubishi Outlander and Nissan X-Trail, - all of which are more expensive for an equivalent seven-seat grade when factoring in on-road costs.
For the model year 2025 update, both Mahindra XUV700 grades gain all-black interior trim, while the AX7L updates to wireless Apple CarPlay and Android Auto, as well as ventilated front seats with memory settings for the power function.
Standard gear in the AX7L includes a panoramic sunroof, dual 10.25-inch screens, synthetic leather trim, keyless entry and start, a 12-speaker audio system, wireless charging and a leather steering wheel.
You also get a 360-degree surround-view monitor, Bluetooth, rain-sensing wipers, dual-zone climate control, 18-inch alloy wheels and an electronic park brake.
The only option available is premium paint at $495 extra, including the 'Midnight Black' shade on our test car.
This isn’t top-grade luxury car levels of standard gear, but there's very little that’s missing and for $43K, that’s impressive.
The 2.5-litre four-cylinder engine with series-parallel hybrid is less powerful than before, but Toyota says it did this for better efficiency and has made up for it with improvements to the battery and electric motors.
The figures are now 143kW and 221Nm (in 2WD and AWD variants), the power down from 160kW in the last generation. All RAV4s still use a continuously variable transmission (CVT).
Basically, lower numbers, but performance on par with the current RAV4 Hybrid according to Toyota.
The XUV700 is powered by what Mahindra calls its ‘mStallion’ 2.0-litre, four-cylinder, turbo-petrol engine delivering 149kW of power and 380Nm of torque. These are solid outputs and the only petrol-powered mainstream rivals that come close to those figures are the Kia Sportage/Hyundai Tucson mechanical twins, with their 1.6-litre turbo punching out 169kW/350Nm.
The Mahindra’s engine is paired with a six-speed automatic transmission driving the front wheels only, so no all-wheel-drive option here.
The new RAV4’s efficiency is of much interest, obviously, and with figures claimed at 0.2L less per 100km over the last RAV4, it’s another case of incremental improvements.
The 2WD comes with a claimed 4.5L/100km, the AWD with 4.6L. During testing we saw numbers as low as 6.8L and 6.9L, respectively, and that was giving it the beans in some pretty twisty mountain roads.
Keep in mind the RAV4 needs 95 RON minimum now, rather than the 91 RON it could deal with before.
The XUV700 is only available with that petrol engine so no fuel-saving hybrid or plug-in hybrid options for now.
It’s also on the thirsty side with an official combined (urban/extra-urban) cycle fuel use figure of 8.3 litres per 100 kilometres. That’s more than petrol versions of the Mitsubishi Outlander and Nissan X-Trail.
After a week of mixed but mostly urban driving, the trip computer showed an average of 8.5L/100km, but my own calculation based on real-world use at the fuel pump came out at 11L, so a bit of a discrepancy there.
Put it this way - the RAV4 doesn’t feel like it’s lacking power. Despite the lower output, the new generation car doesn’t seem to struggle with having enough pick-up to keep moving along, even in spirited driving.
The first time I properly took off it surprised me with how punchy the response was. And from there on the new RAV continued to impress.
It’s one of a few things that, dare I say, makes the RAV4 rather fun to drive.
Like its predecessor, it’s built on the 'TNGA' platform, which underpins pretty much everything Toyota builds these days.
It’s a well-sorted basis for a car, making even this relatively large family SUV feel nimble.
Some changes to the suspension help here, too. New geometry and spring and damper rates mean the RAV4 is sharper and better controlled than before.
That control comes with the trade-off that it’s not always cloud-soft, but given Australian preferences and the need to keep the rubber on our rough as guts roads, Toyota has the balance right here.
It also hasn’t seemed to matter massively whether the RAV4 is front- or all-wheel drive even in the wet on twisty Tassie roads. The 2WD requires a little more care being flung into corners but the mid-sizer holds its own well enough.
There’s clearly more ability in the RAV4 than it’ll make known, almost as to keep the driver behaving safely just in case, while being confident in knowing the RAV4 is more capable than many will ever find out.
It’s handled high speeds, sharp corners and unsealed roads to a higher degree than anyone would reasonably expect of a family SUV.
It helps that the steering, throttle and braking are all well-calibrated. Planting your foot brings urgency without a jolt, there’s no guesswork in the steering and the brakes won’t have you lurching at a tap but can pull you up rather rapidly if needed.
It’s easy to drive, which is pretty big compliment and surely one of the key goals for the engineering team.
On the road the Mahindra has some clear pros and cons. Overall, it’s a more polished performer than you might expect.
The turbocharged engine sounds good when pushed and is a punchy unit, delivering linear acceleration and getting to speed quickly, mostly without fuss. The 235/60R18 MRF Wanderer tyres have a tendency to chirp when accelerating hard and the XUV700 would benefit from higher quality rubber.
The six-speed auto transmission works well with the engine, delivering smooth shifts but it can hold gears on downhill runs.
Ride quality is a mixed bag. Those tyres have a high sidewall but you’ll feel bumps like road and bridge joins, while speed bumps aren't so smooth, either. The ride is on the firmer side but it’s no dealbreaker.
It’s a little top-heavy when cornering, so there is lateral movement in the car. A good reminder this is a family SUV, not a hot hatch.
Steering is overly light and a bit too sharp for this sort of vehicle. There’s nothing wrong with dull or slower steering in a family car because it’s less responsive if you accidentally turn the wheel when distracted by shenanigans in the back seat.
The brakes are also quite sensitive. Just a tap of the foot and you’re coming to a full stop.
A bit of road and wind noise creeps into the cabin, so it’s not the most hushed interior, but it’s not too dramatic.
Other points include a decent turning circle, making it more nimble than you might think in tight parking spots, and poor-quality, low-definition lane watch camera display. Also the remote lock and unlock is temperamental. You need to double check it’s locked.
Toyota doesn’t have an ANCAP rating for the RAV4 yet, which is a massive problem for the brand, especially for its fleet buyers.
The systems in place seem pretty sound, and the brand says it’s the safest RAV4 yet.
We have no reason to doubt that, but we can’t just take a manufacturer at their word, that’s why ANCAP exists.
Eight airbags, AEB pre-collision, emergency steering assist, full-speed active cruise control, front and rear cross traffic alert, lane trace, automatic high beam, parking support brake and blind spot monitor are all standard across the range, which is a plus.
It’s also all quite well programmed.
From behind the wheel, you’ll notice persistent but gentle steering wheel nudges when approaching the shoulder, and occasional chimes for driver distraction when using the main screen, but otherwise it’s very well calibrated and cements the experience Toyota has with making its systems easy to use.
The XUV700 is yet to be assessed by ANCAP so it currently doesn’t have a score.
The standard safety list is solid without being exceptional, and it includes seven airbags in this grade, with the curtain airbags stretching all the way back to the third seating row. However, it misses out on a front centre bag.
In terms of driver aids and advanced driver assistance (ADAS) tech, it also comes with adaptive cruise with stop & go, auto emergency braking, lane keep assist, lane departure warning, traffic sign recognition, tyre pressure monitoring, blind spot monitor and a pilot assist function. It lacks a rear cross-traffic alert.
The reversing camera lags when you put the car in reverse, taking a couple of beats to kick in. Not great when you’re trying to park on a busy street.
The adaptive cruise needs further calibration. When the system detects a car in front, it slows the Mahindra down a little too dramatically and takes too long to respond.
Toyota’s standard five-year/unlimited kilometre warranty is not just disappointing compared to other mainstream brands, but should be much higher given the brand is the biggest in the country (and world) and trades on its reputation for reliability.
The warranty can be extended to seven years from delivery if you maintain your logbook servicing with Toyota dealerships, but even then it falls short of Nissan and Mitsubishi’s 10-year (also servicing-conditional) warranties.
Capped-price servicing costs $325 per service and is available for five years or 75,000km, with intervals every 12 months or 15,000km.
Toyota boast a long-established national network of around 300 dealers covering all states and territories including major cities and key regional and rural centres.
Mahindra covers the XUV700 with a seven-year or 150,000km warranty which is generous but doesn’t match Kia’s seven-year, unlimited-kilometre term. It also includes seven years of free roadside assistance.
The servicing schedule has a few quirks. There’s a free service at 1500km or one month of ownership, then the next service is at 12 months or 10,000km, whichever occurs first. After that the term is every 12 months or 15,000km, so it’s a little confusing.
There’s four years of capped-price servicing that averages out to about $445 per service. That’s roughly $100 more on average per service than a petrol Mitsubishi Outlander.