The Ford people at the Los Angeles Auto Show late last year unabashedly began lobbing bombs at Toyota – bombs in the form of T-shirts.
Ford had stacks and stacks of Ts emblazoned with these words: “Why waste your money on Camry or Accord? Ford Fusion gets more miles per gallon.”
And Ford has the numbers to prove it. The 2010 Fusion Hybrid does get substantially better fuel economy than the Camry Hybrid.
The Ford hybrid sedan ($31,999) goes on sale in a few weeks, about the time Honda launches its Insight hybrid, a five-door hatchback.
The Insight has already been launched in Japan and it's a hit. Honda's cost-cutting has made the Insight the least-expensive production hybrid in the world.
At the Japanese plant where the car is built, 600 hot-selling Insights are churned out each day. At 1.89 million yen in Japan ($19,800 in the U.S., though no Canadian price has been announced), the Insight – with 21,1000 advance orders as of this week -- is flying off dealer lots.
Now for the next volley in this hybrid war. The 2010 Toyota Prius goes on sale officially next month, with deliveries expected in June. Toyota Canada has not set a price publicly, yet, but expect a surprise. Perhaps a cut to something below the 2009 car's $28,710 price tag is in the works?
Or perhaps Toyota will continue to sell the old Prius while at the same time rolling out the new one. That's what is happening in Japan.
Various sources in Japan say Toyota Motor Corp. plans to keep selling the current, six-year-old Prius alongside the upcoming new version -- at least in the home market.
"They will have different engine sizes -- 1.5 litres and 1.8 litres -- and we figure there will be demand for the two to co-exist," Toyota president Katsuaki Watanabe told reporters this week.
Japan's Nikkei newspaper says the old Prius will be sold as a stripper version of the current model and it will be priced to go head-to-head with the Insight.
Again, what about Canada? No word yet. I imagine the debate over what to do is raging at Toyota Canada headquarters right now.
There is more to this story, too. Whatever happens with the Prius, Toyota would surely love to crush the Insight upstart with a new, smaller, less expensive hybrid than either the new or outgoing Prius.
"We are developing a low-priced hybrid vehicle like Honda's Insight," said Akihiko Otsuka, chief engineer of the third-generation Prius, in reports on www.just-auto.com. "We are going to compete by expanding our hybrid-vehicle lineup to smaller hybrids, in the class of the Vitz (sold in Japan) and Yaris."
Look for the Yaris hybrid in 2011.
Toyota is banking on the new Prius to be a big hit. The old one certainly was -- the best-selling hybrid in history with more than one million sold. The next million might not be so easy to move, though.
Still, in typical Toyota fashion, there is plenty of forethought in the 2010 version. The new Prius is more aerodynamic, more powerful and it shares a new platform with the Auris, which replaced the Toyota Corolla hatchback in Europe.
The 2010 Prius is a dramatic step forward in every way. It's more entertaining to drive, better looking, more comfortable and the hybrid technology works more smoothly.
Nonetheless, today's car buyer is being very careful with money. If Toyota Canada chooses to sell both old and new versions, the risk is that the once-outgoing model – the cheaper hybrid -- will steal sales of the new version.
One of the ad campaigns for the Honda Insight has the tag line, “Hybrid for Everyone.” That appears to be truer than any advertising copywriter could have ever imagined.
The cutthroat competition for hybrid buyers means prices will be under great pressure. That's good for consumers who have long wanted a green car, but balked at the price.
But for auto companies struggling to make profits in tough economic times, the “Hybrid for Everyone” wars may end up also turning into “Profits for No one” in the hybrid car business.
