The Toyota iQ city car platform could be used for a larger car.

The iQ concept was first shown at last year’s Frankfurt motor show. It is a city car just three meters long, which will be positioned between the Fiat 500 and BMW Mini.

According to Autocar, a larger model would make sense because, although it will be sold as a premium model, the iQ will struggle to achieve economies of scale to make it cost effective. A larger car would help achieve total sales for the platform of around 500,000 units.

Autocar says that a bigger car would be in direct competition with the VW Up! It adds that its Toyota sources say there will not be a hybrid version as there would be no room for a battery pack in such a small car. It would also be heavy and undermine weight saving efforts.

The iQ will go on sale in early 2009. There will be a choice of two petrol engines and one diesel engine.

So it was not a great surprise when the sources confirmed that a bigger version of the iQ was possible. Such a move would also put the Toyota in direct competition with the VW Up! range.