Hybrid car sales cushion Toyota sales results

US sales of Toyota's hybrid cars have surpassed the one million mark, the Japanese car giant said today, highlighting the rising popularity of ecological vehicles.

It took seven years for Toyota, the world's biggest carmaker, to sell 500,000 hybrids in the US, but has taken just two years to sell the next 500,000, the Japanese company said in a statement.

However, Toyota's US sales have been battered by the ongoing slowdown, tumbling 39.8% from a year earlier in February.

The company delivered a blow to the UK car industry yesterday when it announced cuts in production and pay at its two UK factories minutes before the British government held a special summit to discuss the automotive crisis.

Petrol prices in the US, which surged during the first half of last year, have come down drastically, and it is unclear whether petrol-electric hybrids will continue to sell as briskly as they have in recent years. US sales of Toyota's Prius hybrid were down 33.6% on year in February.

Toyota is introducing the third-generation Prius later this year, but that is expected to meet intense competition from the Insight hybrid from Japanese rival Honda. The Insight starts at 19,800 (€15,535) in the US, where it will go on sale on March 24, as the cheapest hybrid on the commercial market.

Since going on sale about a month ago in Japan for 1.89m yen (€15,419), Honda has racked up 18,000 orders for the Insight, more than triple the 5,000 that Honda targeted. Toyota has not disclosed prices for the upcoming Prius.

Toyota, which also makes the Camry and Corolla sedans, introduced petrol-electric hybrids to Japan in 1997, and the US in July 2000, with its Prius. The Prius is still the world's top-selling hybrid.

"One million hybrids in less than nine years indicates how quickly American consumers have accepted this important technology," Jim Lentz, Toyota's top US executive, said in a statement.

Toyota controlled nearly 75% of the US hybrid market over the past decade, and cumulative worldwide sales of the company's Prius and luxury Lexus hybrids topped 1.7 million vehicles through January.

Toyota has sold 700,000 Prius cars in the US, more than half the 1.2 million sold worldwide.

The cuts it announced yesterday in the UK, the latest in a series of measures to cope with a slump in sales, will start next month at the company's sites in Burnaston, near Derby, and Deeside in North Wales and last for a year.