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2010 Toyota Prius
Honda's Insight isn't the threat that Toyota once thought

Toyota's third-generation Prius is a certified hit with consumers. While the Prius has been one of Toyota's more popular models in recent years, the 2010 Prius with its promise of 50 mpg has pushed sales and demand into the stratosphere.

At first, however, Toyota was a bit worried over how much damage Honda's cheaper 2010 Insight would do to the sales of its "green" poster child. The Insight has a base price of $19,800 which undercuts the Prius by a few grand. To combat the price gap, Toyota announced earlier this year that it would launch a "stripper" Prius I for just $21,000 to better compete with the pricing of Honda's Insight.

As it turns out, Toyota really had no cause for concern. The Insight hit U.S. streets and failed to generate the sales that Honda had hoped for its latest entry into the hot hybrid field. Most consumers didn't seem to care about the higher price of the Prius due to its better fuel economy (50 mpg combined vs 41 mpg combined), greater passenger/cargo space, better performance, and higher level of tech gadgetry on the options list.

So due to Honda's miss for targeting the second-generation Prius instead of the beefed up third-generation model and strong sales, Toyota has dropped plans to introduce the base Prius I for general consumers. The model will still be made available, however, for fleet customers.

In addition, Toyota is also bumping the price of the Prius II, III, and IV trim levels by $400. The new pricing will go into effect on October 18.

During the month of August, Honda was only able to sell 4,226 Insights in the U.S. However, Toyota managed to move a whopping 18,886 Prius hybrids during the same month.




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$400 isn't a lot
By amanojaku on 9/29/2009 10:48:20 AM , Rating: 3
But there's no explanation as to why the price increase. I've read different stories about the profits or losses on hybrids, so I don't know if this is to make up for losses on introductory prices or simply to take advantage of poor competition. Consumers like it when the price goes DOWN, so what gives?




RE: $400 isn't a lot
By KenGoding on 9/29/2009 10:51:58 AM , Rating: 3
Ever try to buy the hot new game console for Christmas? People will pay crazy amounts for one because they want it. People want the Prius, and most of them will gladly pay the extra money so they can it.


RE: $400 isn't a lot
By Reclaimer77 on 9/29/09, Rating: -1
RE: $400 isn't a lot
By Brandon Hill (blog) on 9/29/2009 11:00:45 AM , Rating: 5
I don't consider it a status symbol, I consider it a good vehicle with good fuel economy.

I've averaged about 27 mpg in my current car (right in line with the EPA combined estimates) for the past 10,000 miles. It'd be nice to have a car that is larger and has more cargo room for about $1,000 more than what I paid for my Mazda 3s Hatch.

In fact, it would make a nice vehicle to replace my wife's 2004 Honda Civic EX.

I, however, still have my eyes on a 2009 Audi A4 Avant Quattro :)


RE: $400 isn't a lot
By Motoman on 9/29/2009 12:02:13 PM , Rating: 3
...I sense a smug alert coming on...


RE: $400 isn't a lot
By Brandon Hill (blog) on 9/29/2009 12:04:41 PM , Rating: 4
Didn't you hear? I already ordered my "smuggy" to keep me nice and warm... snuggies are old hat ;)


RE: $400 isn't a lot
By Chudilo on 9/29/09, Rating: -1
RE: $400 isn't a lot
By Brandon Hill (blog) on 9/29/2009 12:30:36 PM , Rating: 5
Terrible acceleration? It's about on par with my wife's Civic EX with its pathetic 1.7-liter engine.

Terrible stability on the road? I've driven Prius' before and never had a problem with highway speeds.

Absence of grip? This is not an autocross car.

General lack of joy? Why do you think I said it's be a perfect car for my wife? :)


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:49:21 PM , Rating: 2
quote:
Absence of grip? This is not an autocross car.
Why does everyone always bring up racing to excuse piss poor handling or otherwise poor performance? The Prius handles and accelerates like crap and you don't need a race track or even to go over the posted speed limit to realize that. Yes, I've driven them and they indeed suck to drive but people don't buy them to compete with BMW's!! They buy them because they get fantastic gas mileage, have a decent amount of room, and a little prestige. They're as practical as a Camry but get WAY better gas mileage. Camry's and Accord's are boring too but people buy them by the thousands. It is what it is and quit making excuses for it.


RE: $400 isn't a lot
By Brandon Hill (blog) on 9/29/2009 12:55:49 PM , Rating: 3
Acceleration of the Prius is in line with other 4-cylinder/fuel conscious vehicles out there, so it's really no shocker. Yes, the acceleration "sucks" in comparison to more powerful vehicles, but compared to other economy cars, it's par for the course.

As for the handling, again I wouldn't say that it's piss poor -- just "different". My previous car was an older Camry. It was softly sprung and very comfortable. My current car is a lot stiffer and is a much better corner carver -- but the ride is also poorer.

For those that that just use a vehicle for A to B transportation, I don't see what the big deal is about its "poor" handling.

It's all relative...


RE: $400 isn't a lot
By quiksilvr on 9/29/2009 1:32:35 PM , Rating: 1
Agreed, but I'd rather get a VW Jetta TDI.


RE: $400 isn't a lot
By Spuke on 9/29/2009 2:17:35 PM , Rating: 1
quote:
For those that that just use a vehicle for A to B transportation, I don't see what the big deal is about its "poor" handling.
It's not considering the vehicle but it still has poor performance. That's my point. No excuses have to be made, that's just the way it is with that type of vehicle.


RE: $400 isn't a lot
By ChuckDriver on 9/29/2009 1:09:24 PM , Rating: 2
Buy the car you want, but there are others with a lower total cost of ownership. Also, you may not consider the Prius a status symbol, but at least one person in the automotive industry does.

quote:
"It was clear that people weren't buying a Prius to save money on gas - gas was selling close to inflation-adjusted all-time lows. They were buying them to make a statement about the environment."

-- Martin Eberhard, founder of Tesla Motors
http://money.cnn.com/2008/07/10/technology/copelan...


RE: $400 isn't a lot
By consumerwhore on 9/29/2009 2:23:45 PM , Rating: 1
I fail to equate "make a statement" and "status symbol". I can wear a T-shirt that says "DailyTech is the shizznits!". That doesn't make it a status symbol.

And honestly, the Prius, a status symbol? Are all cars that cost upwards of 30k status symbols now? I missed that memo.


RE: $400 isn't a lot
By maverick85wd on 9/29/2009 5:50:33 PM , Rating: 1
quote:
It'd be nice to have a car that is larger and has more cargo room for about $1,000 more than what I paid for my Mazda 3s Hatch


My 94 Golf TDi gets about 43 MPG. My best friend's 2003 Passat was getting around 50 @ 95MPH (before he got rear-ended). I think hybrids are a great idea, and in some places petrol is cheaper/more accessible than diesel, but I'm about to move back to the States (currently in the UK) in a few months; I REALLY wish I had a selection of 2005-2007 used diesels to choose from when I get back after owning and driving one for the last year.


RE: $400 isn't a lot
By maverick85wd on 9/29/2009 6:08:29 PM , Rating: 2
if you don't like what I wrote and want to rate me down, that's fine... but I would really prefer an intellectual response detailing why what I said is in some way wrong or inaccurate (complete with facts backing said rebuttals, of course ;-).


RE: $400 isn't a lot
By Spuke on 9/29/2009 6:43:29 PM , Rating: 2
quote:
if you don't like what I wrote and want to rate me down, that's fine
There are a few Prius lovers out there that don't likely ANY anti-Prius talk whether or not it makes sense. If you would've said you were going to buy one when you got back to the States, you would've gotten a 6.


RE: $400 isn't a lot
By HotFoot on 9/29/2009 11:00:01 AM , Rating: 3
Did you also call the SUV drivers 'stupid freaks' during the SUV heyday? Of COURSE there's a type of status that's being marketed and sold in cars like the Prius. Welcome to marketing. It's not rational, it's emotional.


RE: $400 isn't a lot
By mmcdonalataocdotgov on 9/29/2009 11:11:20 AM , Rating: 2
How is great price, great fuel economy, great reliability, great room, great features an emotional appeal?


RE: $400 isn't a lot
By HotFoot on 9/29/2009 11:22:39 AM , Rating: 5
I'm not saying it's irrational to buy a Prius. I'm saying that the marketing for the 'green' or 'eco-friendly' movement is largely based on emotions, as marketing always has been. A Hummer is sold as much on the image/status of it as anything else, and my point is that unless we also scoff at everyone that drives an over-sized gas guzzler, it's hypocritical to scoff at people hopping on the eco bandwagon.

I think all this does is expose how uncomfortable it makes some people that, when faced with similar choices, others might go for such a vastly different option as one's own preference. Too often I see the same people defending their right to do as they please and drive their guzzling muscle car if they G*d d**n want to, and then turn around and label Prius owners as having some kind of hidden agenda to force the eco movement on the rest of the free world. Get over it! We each have equal right to choose our own vehicle preference.

BTW I'm not ranting directly at you mmc I'm just trying to clarify what I was getting at earlier.


RE: $400 isn't a lot
By DEredita on 9/29/2009 11:42:44 AM , Rating: 2
Because people who buy it usually feel like they are being environmentally friendly. Or, it can also be so they get that special access to the HOV-lanes in California to bypass all the traffic. ;)


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:12:13 PM , Rating: 1
quote:
How is great price, great fuel economy, great reliability, great room, great features an emotional appeal?
Reasons for buying a car vary. But the Prius is indeed a status symbol. A status symbol is not necessarily indicative of excess.

http://en.wikipedia.org/wiki/Status_symbol#cite_no...


RE: $400 isn't a lot
By randomposter on 9/29/2009 12:28:08 PM , Rating: 3
Gold coins may be a status symbol for one person, and they may be a survivalist tool for a different person.

A vacation to Thailand may be a status symbol for one person, and it may be a simple exercise in destressing for a different person.

A Toyota Prius may be a status symbol for one person, and it may be basic, practical transportation for a different person.

etc.

etc.

etc.


RE: $400 isn't a lot
By Spuke on 9/29/2009 3:08:01 PM , Rating: 2
quote:
Gold coins may be a status symbol for one person, and they may be a survivalist tool for a different person.
A Mercedes Benz may be a status symbol for one person, or simply a fast, comfortable car for a different person.

etc.

etc.

etc.


RE: $400 isn't a lot
By randomposter on 9/29/2009 3:33:01 PM , Rating: 2
Exactly.

Sounds as if we are in agreement then that a Prius may or may not be a status symbol depending on the motives of the purchaser.


RE: $400 isn't a lot
By Spuke on 9/29/2009 5:20:57 PM , Rating: 2
quote:
Sounds as if we are in agreement then that a Prius may or may not be a status symbol depending on the motives of the purchaser.
I agree but my original point was:
quote:
A status symbol is not necessarily indicative of excess.
A Prius can be status symbol just like anything else.


RE: $400 isn't a lot
By consumerwhore on 9/29/2009 6:02:42 PM , Rating: 2
Why don't you go read that Wikipedia page you're linking to. You just may learn a thing or two.

Nobody envies Prius owners for owning a Prius.


RE: $400 isn't a lot
By Spuke on 9/29/2009 6:44:55 PM , Rating: 2
quote:
Why don't you go read that Wikipedia page you're linking to. You just may learn a thing or two.
Why don't you take some classes on reading comprehension?


RE: $400 isn't a lot
By consumerwhore on 9/29/2009 8:13:46 PM , Rating: 2
Thank you for admitting you lost that argument by replying with a "Can you read?" post.


RE: $400 isn't a lot
By randomposter on 9/29/2009 11:02:57 AM , Rating: 3
... or an alternate explanation is that Toyota has a hit on their hands with a vehicle offering a good blend of space, utility, and fuel economy, so people are snapping them up because they like the complete package and want to save a few thousand bucks in gas every year.

In other words, Toyota is offering value. What are you offering besides bitterness and a vacuous prattle?


RE: $400 isn't a lot
By MaulBall789 on 9/29/2009 11:09:36 AM , Rating: 2
quote:
You can't put a price on what stupid ecofreaks will pay to feel good about themselves.


Except there are obviously way more of these ecofreaks than you will care to admit. This is nothing more than a supply/demand capitalist decision. Demand is more than high enough for these vehicles, and not just ecofreaks are buying them. People who value bang for the buck, for instance. These cars save a lot in fuel costs over the average passenger vehicle. People of all backgrounds appreciate that fact.


RE: $400 isn't a lot
By Reclaimer77 on 9/29/2009 12:39:23 PM , Rating: 2
If demand was that high there would have been no subsidies for Hybrids. If demand was that high the government wouldn't be creating fuel shortages, purposely not drilling our own oil to create a "dependency" to keep fuel prices artificially high. If demand was that high market conditions wouldn't unatturally stacked in Hybrid's favor purposely.

And even after all that, Hybrid sales are still pathetic by any objective measure.


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:53:05 PM , Rating: 2
quote:
And even after all that, Hybrid sales are still pathetic by any objective measure.
Sales are not pathetic, the Prius is in the top 20 sales every month. It's not Ford F series or Camry sales but it's still pretty good.


RE: $400 isn't a lot
By DEredita on 9/29/2009 11:39:08 AM , Rating: 2
If more people buy a Prius instead of an SUV, then in theory, the demand for gasoline drops, which makes the price of gasoline decrease. I'm all for that. I'll drive what I want to drive, whether it's a turbocharged Subaru or a Mustang, or an SVT Raptor.


RE: $400 isn't a lot
By 67STANG on 9/29/2009 1:28:30 PM , Rating: 2
I wouldn't bank on it... Lately when oil prices drop due to lack of demand 1 of 3 things happen.

1) OPEC announces cuts to production.
2) Refiners operate at a lower capacity to artificially inflate prices.
3) Both.

Last I checked, oil prices where still <$70 barrel and I'm still paying $3.00 gallon (in California).


RE: $400 isn't a lot
By kamel5547 on 9/29/2009 11:48:38 AM , Rating: 2
The difference being that quite a few people commute 60-80 miles roundtrip everyday (based on where people live in our office in downtown LA). Fuel economy actually makes sense at that point, rather than a status symbol it represents around $1500 a year in lower fuel (costs based on current prices in CA).

Sure a new car is more expensive than a used car, but if you are buying a new car the Prius isn't as bad a purchase option as you might think it is for people with longer commutes (of course I prefer the train to sitting in traffic).


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:20:42 PM , Rating: 2
quote:
rather than a status symbol it represents around $1500 a year in lower fuel (costs based on current prices in CA).
The Prius is also a status symbol. See my post above.


RE: $400 isn't a lot
By HotFoot on 9/29/2009 10:57:35 AM , Rating: 2
I think it's as simple as the article states. Toyota under-estimated demand for the new Prius, and had placed their bets at a lower price for maximum profit. Higher price makes sense to counter the higher demand. The cost of manufacture is irrelevant. "Everything is worth what the purchaser will pay for it."

Still, I don't like this move. A Prius isn't in my plans, but I think Toyota loses a little face by doing this. They now look like the bad guys gouging their customers during a fragile economic recovery. I think the prestige of their company would be better served by maintaining the original price and if demand is high, they can brag about how many people they have on a waiting list for Prius shipments as they work hard to expand production capacity.


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:28:47 PM , Rating: 2
quote:
I think the prestige of their company would be better served by maintaining the original price and if demand is high
A publicly traded company exists to make a profit, period. They are obligated by LAW to at least make an attempt to do so in the US. They do not exist to make people feel good. If you happen to feel good about this company, all the better to them (and you). If demand is high for the Prius, it makes perfect sense to a publicly traded company to increase the price. $400 is not a lot to the individual but multiplied by ~19,000 cars (last months sales), it adds up.


RE: $400 isn't a lot
By MozeeToby on 9/29/2009 11:00:31 AM , Rating: 3
If they're selling every Prius that rolls off the line in a matter of weeks, why wouldn't they up the price a bit? The price is what the market will bear; ussually that means lower and lower prices as supply goes up (new competitors like the Insight) and demand goes down (as Prius lovers already own one) but that isn't always the case.

It seems that the Prius is its own little sub-market within the Hybrid market, people that want a Prius don't want other Hybrids or at least are willing to pay a premium for one over the compitition with similar feature set. $400 might not seem like much, but they sell almost 300k Priuses a year, that increases revenues by more than $100 million. And it's 100% profit if their sales stay the same.


RE: $400 isn't a lot
By Spuke on 9/29/2009 12:36:41 PM , Rating: 2
quote:
but they sell almost 300k Priuses a year, that increases revenues by more than $100 million.
Closer to 200k a year but at $7.6 million a month that still represents a tidy increase in profit. Although, I think they would stand to make more by increasing the Corolla's price by that same amount. The Corolla's sales have increased, percentage wise, as much as the Prius but sells in much higher numbers.


RE: $400 isn't a lot
By Hiawa23 on 9/29/2009 11:15:52 AM , Rating: 3
Sounds like good business. Why reduce the price when you don't have to & if consumers are willing to pay more, raise your prices. Capitalism at it's finest.


RE: $400 isn't a lot
By Ratinator on 9/29/2009 11:39:41 AM , Rating: 2
It is taking a advantage. An article about 6 months ago indicated Toyota made $3300 in profit from every Prius sale. That is a solid $62 million profit in one month from just one line of vehicles. That extra $400, though it isn't all that much would generate another $7.5 million (based on the 18000+ sales they indicated for August).


RE: $400 isn't a lot
By Mojo the Monkey on 9/29/2009 12:37:04 PM , Rating: 2
quote:
But there's no explanation as to why the price increase. I've read different stories about the profits or losses on hybrids, so I don't know if this is to make up for losses on introductory prices or simply to take advantage of poor competition. Consumers like it when the price goes DOWN, so what gives?


Go search: "capitalism" on the intarwebz


RE: $400 isn't a lot
By The0ne on 9/29/2009 2:04:09 PM , Rating: 2
The only reason is demand. They are simply taking advantage of it to make more profit. They can toss BS reasons out there but this really is the only reason. Demand is very very very high.


By Bateluer on 9/29/2009 11:40:41 AM , Rating: 2
Highlight the cheaper price of the Insight and how the Prius costs more. Would likely lead to increased sales for them.




By Brandon Hill (blog) on 9/29/2009 11:52:55 AM , Rating: 2
They've already done that by pointing to its low price. It simply hasn't sold as well as the Prius because it's an inferior product -- and its priced accordingly.


By Spuke on 9/29/2009 12:56:46 PM , Rating: 2
quote:
It simply hasn't sold as well as the Prius because it's an inferior product -- and its priced accordingly.
And more than likely seen as "cheap" and probably why Americans aren't buying hardly any. Honda needs to directly compete with the Prius. They more than likely would see increased sales.


By kmmatney on 9/29/2009 2:09:36 PM , Rating: 2
If the Honda Insight was a better car, people would be buying it. I've heard the road noise is terrible and the ride is like a Geo metro. Might as well buy a civic, or pay more for a better car.


Test Drive
By n00bxqb on 9/29/2009 12:08:53 PM , Rating: 2
I've always wondered how many cars people test drive before they buy a Prius. The only reason why I ask is, having driven one, it was no fun, layed-out in an awkward fashion, and had terrible peripheral vision that would all deter me from buying it on the spot. At the very least, I would test drive at least another hybrid car to see if it were any nicer to drive.




RE: Test Drive
By Mojo the Monkey on 9/29/2009 12:48:35 PM , Rating: 2
most other hybrids which you would consider nicer, for the above reasons, are in another price category. (camry, altima, etc)


Volt
By andrinoaa on 9/29/2009 5:28:46 PM , Rating: 2
It will be interesting to see what will happen when the Volt is released. The Prius price increase/demand suggests that GM will have no trouble at all selling the Volt for $35-40,000. In some ways its a game change. It also means that sticker price alone isn't as big a deterent as it used to be to buying a car ie more people are prepared to pay more for "modern" new cars. ( for want of a better word)




RE: Volt
By Spuke on 9/29/2009 6:52:46 PM , Rating: 2
quote:
The Prius price increase/demand suggests that GM will have no trouble at all selling the Volt for $35-40,000.
They're only raising the price $400. To the consumer, we're only talking about a $8 a month increase in payments.


By drewsup on 9/29/2009 11:33:53 AM , Rating: 2
Easy,
Because they CAN! Supply and demand my friend, supply and demand.




Economics 101
By Titanius on 9/29/2009 11:35:58 AM , Rating: 2
With higher demand, the price is going to be higher. BTW in hindsight, this is a relatively small price increase.




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