The Avalon filled the gap left by the cancellation of the Toyota Cressida in the American market in 1992. While the Cressida was an upper-level midsize rear-wheel drive car with a straight-6 engine, the Avalon is front-wheel drive, powered by a V6 engine. (The Toyota Camry, which was slotted below the Cressida and Avalon, was initially a compact, but later was stretched to midsize; hence, the Avalon was introduced as a large car.)
The 1995 Avalon was a completely new model, built in the same plant as the Camry. It was positioned higher than the Camry, making it Toyota's flagship. The Avalon was based on a stretched Camry platform and had a 3.0litre V6 engine making 192hp (140kW) and 210lb·ft (285N·m) of torque. For 1997, the Avalon's power rating increased to 200hp (150kW), and torque increased to 214lb·ft (290N·m). Toyota made minor updates to the front and rear fascias in 1998.
The Avalon was available with a front bench seat for full six-passenger seating, and its column shifter was the first such feature in an American Toyota car since the 1982 Corona. Side airbags and seatbelt pretensioners were optional, as was traction control. The 1MZ-FE engine with VVT-i was used in the Avalon. Output was 210 hp (156 kW) at 5800 rpm with 222 ft·lbf (328 N·m) of torque at 4400 rpm. Early versions of the VVT-i 1MZ used a dual throttle body, cast aluminum intake manifold, and EGR block-off plates on the exhaust manifolds. Later versions used an ABS plastic intake manifold for further weight reduction and decreased cost. These versions may also have drive-by-wire (electronic) throttle control.
In 1999, Toyota sold the old tooling for the Avalon to Toyota Australia, which launched this Avalon as an "all-new" model in June 2000. The Australian Avalon therefore had an identical body to the original 1995 Avalon. The Avalon performed poorly in Australia; critics called the car "boring," and sales were tepid. It did not help that the car was front-wheel drive and available only as a sedan with a 3.0litre V6 and automatic transmission. By contrast, its intended rivals, the Holden Commodore and Ford Falcon, offered a wider range of body styles and engine/transmission options.