Toyota reveals new Prius

Japanese car giant Toyota unveiled its new Prius hybrid today saying it already had 80,000 advance orders amid increasing competition with Honda’s rival Insight car.

It said it hoped to sell up to 400,000 cars a year around the world.

“We are resting the future of cars in this model,” said incoming president Akio Toyoda, the grandson of the company’s founder, who drove the new model onto a stage at a Tokyo showroom.

Both Toyoda’s presence and the new Prius are symbolic of Toyota’s pursuit of a turnaround from its worst annual loss since its 1937 founding.

The Prius, now in its third generation since its 1997 introduction, is the best-selling petrol-electric hybrid in the world, selling 1.256 million in more than 40 nations and regions..

But now Toyota faces a challenge from Honda whose cheaper Insight has sold briskly since it was introduced in Japan in February. In April, the Insight ranked as the top-selling vehicle in Japan – the first time a hybrid clinched that spot.

Toyota said its Japan prices for the Prius would start at about £14,250 (€16,100).

But in an unusual move aimed at competing against the Insight, Toyota also said it will continue to sell the current Prius in Japan – and cut its price.

In Japan, Toyota is hoping to sell 10,000 of the new Prius a month, and an additional 2,000 of the cheaper old-style Prius.

The new Prius gets a combined 50 miles per gallon, compared with 46 mpg for the 2009 model, according to Toyota.

It does even better under Japanese government testing standards. Hybrids, by going back and forth between a petrol engine and electric motor, tend to offer better mileage in slow-speed and stop-and-go driving common on Japanese streets, rather than on main roads – just the reverse of standard petrol engine cars.

Although global demand for hybrid vehicles grew when oil prices were surging, that interest settled as prices subsided and a global slowdown squeezed car sales.