New Toyota Yaris will be offered in a hybrid
Everyone in business knows that selling on price is a downward slope to non-profitability, but with profit out of reach for many automakers these days, ignoring price-oriented marketing is pure folly.
In this respect, Toyota appears to be in a conundrum. Its Prius, the darling of eco-minded consumers everywhere and by far the best selling hybrid electric vehicle (HEV) anywhere in the world, finds itself a bit overpriced now that Honda has shown up with its similarly styled and configured, albeit smaller sized Insight. Starting price for the Insight, when it goes on sale globally on April 22, Earth Day not coincidentally, will be a mere $19,800 in the US. That's $2,200, or about 10-percent less, than the US-market Prius – Canadian pricing has yet to be announced.
Currently, a Canadian-spec Prius will set its buyer back $27,110, so factoring in a 10-percent savings, if Honda Canada adopts the US pricing model, would slot the new Insight into the burgeoning hybrid market at about $24,999, a significant savings. Some are speculating that the new Insight will sticker closer to $22,900, which would make it a slam dunk from a pricing perspective, but we haven't heard from Toyota about the pricing of its all-new 2010 Prius yet, and of course, there is more to overall value than merely a lower initial sticker price, including standard features at the front end and residuals at the back. Most consumers see the base price first, however, and factor in other details after driving the car at their local dealer, and by then, if the salesperson knows their craft, it's too late.
Rather than reduce the price of its already value-packed Prius, Toyota may have another solution, or so says industry insider Automotive News. The Detroit-based news service is reporting that Toyota is planning a Yaris hybrid to undercut Honda's newest HEV, information garnered from Toyota's chief engineer Akihiko Otsuka via an interview with Japan's Nikkei newspaper. Other associated news stories are already talking about a hybrid "price war", but really, Toyota and Honda have been battling out their pricing strategies for years, to the benefit of consumers everywhere.
When the current Prius debuted in 2003 as a 2004 model year product, it stickered at $29,990, the identical price to the much less capable outgoing model, the original Prius. The new savings was in value, a lot more for the same price. Interestingly, Honda's Civic Hybrid had already been introduced the year before, for only a thousand and a half less at $28,500, and to most the larger standalone hybrid from Toyota appeared like the better value despite the slightly higher price, and so sales of the Prius soared while those of the ultra-green Civic were comparatively moderate. Honda brought out an all-new Civic Hybrid simultaneously with the totally revamped Civic in the 2006 model year, a much better car for a base price of $25,800 (now $27,350... yes more than the Prius), a massive savings over the old model, initially. Toyota responded with a mid-cycle upgrade to the Prius that included numerous improvements, and the price since then has dropped to the aforementioned $27,110, or approximately 10-percent off of 2004 model-year price.
source: autos.canada
