At the beginning of the 90s, Volkswagen started to invest more in the Spanish brand, and the Toledo was the first vehicle built on a German platform by SEAT.
With an increased demand for compact-sized sedans, Volkswagen saw the opportunity to use the Spanish brand to conquer new European markets. In addition, the labor costs in Spain were lower than those in Germany, so it had better chances to create a vehicle that was more affordable and able to compete against the Italian and French cars.
Volkswagen hired Giugiaro to pen the car and establish a new design signature for the Spanish brand. Thus, the Italian studio created a wedged-shaped vehicle with narrow, rectangular headlights that flanked a black plastic grille. The chromed badge took center stage, and soon it was recognized all over Europe. From its profile, the Toledo revealed the grab handles for the doors and the raked-forward rear C-pillars. Unlike the Jetta and the Golf, with which it shared its platform, it was a liftback. The rear windscreen opened along with the trunk lid, revealing a big loading area.
Inside, on the other hand, it didn't feature the same angular shapes on the dash, which was penned with a rounded shape over the instrument cluster. Still, there were rectangular-shaped air vents mounted on the center stack and on the sides. Depending on the trim level, the car also featured a driver airbag, a stereo-cassette player, and power windows. In the back, the split-folding bench allowed customers to increase the loading area.
Under the hood, the Toledo received a choice of gasoline and diesel engines, ranging between 68 PS (67 hp) and 150 PS (148 hp).