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2012 Toyota Prius

The stunning reliability of the Toyota Prius hybrid is matched only by its taxi-cab design. That's the truth of it. Toyota Motor knows it and Toyota's rivals know it, too. And now we have a better idea of what Toyota is going to do about it.

Last week in the aftermath of the interesting news that Ford Motor is pulling out of its hybrid partnership with Toyota, the world's No. 1 car company by sales unleashed a barrage of news about the company's future hybrid plans. For a company always reluctant to chat about the product pipeline, the announcements were shocking.

Toyota managing officer Satoshi Ogiso said the next-generation Prius expected in the first half of 2015 will usher in all-new and improved hybrid technology. Toyota also says that between now and the end of 2015, the company will introduce 15 new or redesigned hybrid vehicles globally. The next Prius will not only be lighter and more compact, it will also have better fuel economy, improved performance, and a "lower cost." Indeed, Toyota already is selling the Prius at a lower cost – at least a $3,000 cash discount on 2013 models.

The new Prius design – more aerodynamic – will ride on a new global platform called the Toyota New Global Architecture. It will be lower, sleeker, roomier inside and have a more robust body structure, says Toyota. Long-needed refinements in the car's interior will finally arrive, too.

Toyota, though, is being coy about the battery technology planned for the new Prius. The company said research into both nickel-metal hydride and lithium-ion batteries will continue. This suggests that Toyota may stay with nickel-metal hydride, when all the world has already moved on to lithium-ion. On the other hand, Toyota also said it is researching new "battery technologies like solid state and lithium air, as well as devoting resources focused on chemistries beyond lithium, such as magnesium and other low-valence materials."

Personally, I'd be shocked to see Toyota take any risks with battery technology. A key piece of the Prius brand is reliability. The car, introduced in the U.S. in 1999 and Canada a year later, is bullet-proof. Rest assured, Toyota will battery-up only with proven technology.

On the other hand, Toyota has plenty of expertise in electric motors, which will be smaller in the new design. And the output of the drive train – power density – will jump to 40 per cent from the current 38.5. I would never doubt Toyota's ability to refine a product with a track record and so expect the hybrid system to operate seamlessly and the electric motors to be quiet, strong and efficient.

Good for Toyota to recognize that its hybrid leadership is under siege. Yes, Toyota has sold more than five million Toyota and Lexus hybrids worldwide, but it's clear now that the company's competitors smell blood in the water. Toyota still dominates the hybrid market, with its U.S. share at 70 per cent and even higher in Canada. That said, Ford Motor has grabbed 16 per cent of the U.S. electrified vehicle market, notes Automotive News. Ford says its models now beat Toyota's in every segment where the two companies compete head-to-head.

2013 Ford C-Max Ford Ford

If you want to see why buyers are showing greater interest in Ford's hybrids, test drive a Ford C-Max wagon against a Toyota Prius v wagon. The Ford is refined inside and out, the performance is flawless and the C-Max is far, far more satisfying to drive. The Prius v, by contrast, looks dated, the power train output lags the C-Max mightily and the interior is rough and unrefined – with unsupportive seats and hard plastics everywhere.

Moreover, the C-Max starts at a lower price ($27,199 versus $27,425 for the Prius v) and the Ford's hybrid system is rated at 188 horsepower, while the Prius v comes in at a paltry 134 hp. Most important of all, the base C-Max hybrid in city fuel economy is rated at 4.2 litres/100, versus 4.3 for the Prius v.

Sure, that's a small difference, but Ford has bragging rights now. That's a sure sign that Toyota needs to update its hybrids.

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