Toyota Motor Sales U.S.A. surprised many industry observers today by announcing that the third-generation Prius will be available in at least one version with a starting MSRP of $21,000, plus $750 delivery.
A hybrid pricing war could be on the horizon.
In a sign of what was a lengthy — and unplanned — marketing discussion inside Toyota on whether to respond to Honda’s aggressive pricing, the lowest priced model will not be available until later in the year. The latest move is also an indication that Toyota can no longer assume it can command a premium in the battered automotive market.
The Prius will be offered with five levels of equipment combinations, designated as Prius I through V. They will range in price from $21,750 up to $34,250, when optional packages are included. Versions II through V go on sale in late May. The 2009 Prius model ranged in base asking prices from $22,720 to $24,990. The newly added new base model, with an as yet unspecified lower level of standard equipment, is scheduled to be available later this year.
When the all-new 2010 model of the Honda Insight went on sale last March 24th, Honda reversed a premium pricing philosophy that it once held along with the Toyota Prius. With a manufacturer’s suggested retail price (MSRP) of $19,800, plus $670 for delivery and any other options, the Insight LX, is now the least expensive new hybrid available in the U.S., but only by a negligible amount – if Toyota’s low-priced model ever appears.
The third-generation Toyota Prius has EPA estimated mileage of 50/49/50 mpg on the city/highway/combined scales and it clearly wins the coveted advertising claim of 50 mpg. Prius is about two inches longer, wider and taller than the Honda Insight, which looks to be a scaled down Prius. (more…)