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
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
Prius hybrids during the same month.