TOKYO (AFP) - Toyota plans a low-cost hybrid to challenge Honda's success with the cheapest model on the market - a move that could spark a price war over the fuel-efficient cars, a report said Friday.
Toyota's new petrol- and electric-powered hybrid will have a price tag below two million yen (31,800 Singapore dollars) - about 20-30 percent cheaper than its Prius, the world's first mass-produced hybrid, the Nikkei economic daily said.
Toyota will initially launch the vehicle in Japan as early as 2011 with a smaller engine than the 1.5-litre Prius, it said without naming its sources. Toyota refused to comment on the report.
The company will reportedly also lower the price of the current Prius to the same levels as Honda's Insight, which costs as little as 1.89 million yen.
Honda said this week it had received orders for 18,000 second-generation Insight hybrids since its launch in Japan last month, more than three times its monthly sales target, in some rare good news from the crisis-hit sector.
The company is aiming to challenge the lead of Toyota, which has sold more than one million Prius vehicles since its launch about a decade ago.
