Correction to This Article
The article incorrectly said that Americans began purchasing the hybrid vehicle in 1997. The Prius was not available in the United States until 2000.

Toyota Wants New Prius to Be America's Next Top Model

By Blaine Harden
Washington Post Foreign Service
Tuesday, June 9, 2009

TOYOTA CITY, Japan -- Memo to the beleaguered U.S. car industry: As the recession eases, torment from Toyota may increase.

Designers of the Prius, the curiously shaped hybrid that since 1997 has allowed up-to-the-minute Americans to advertise their eco-correctness, are going after the Average Joe.

The third-generation Prius is not just for "some special people," said Wahei Hirai, Toyota's managing officer for design. "This is a mainstream car."

The new model is more powerful than its predecessors, with more headroom, a bigger trunk, better gas mileage and a lower price. It is only now being rolled out in the United States, but judging from exceptionally brisk Japanese sales and effusive early reviews, the car looks like a hit. In May, the Prius was Japan's best-selling car.

To keep up with surging domestic demand, overtime has been brought back at the two plants that assemble the car. Workers have been transferred in from factories around the country. Production has grown to 50,000 cars a month, but customers in Japan must wait three to four months to drive home a new Prius.

The car's sudden popularity comes in a country where the recession has been roughly twice as severe as in the United States and where car sales have been slumping for years. Sales here have been helped by new tax incentives.

Yet, the real test for the new Prius is the United States, where sales of earlier models have historically dwarfed sales in Japan or Europe. As Toyota executives, engineers and designers explained to reporters during a two-day tour here, the world's largest car company has spent 4 1/2 years tweaking the Prius so it can become much more than merely an "eco-icon."

"We are not forsaking the people who want to make an environmental statement," said Paul Nolasco, a Toyota spokesman who helped lead the tour in and around Toyota City. "But the objective of the Prius is to get the family to the mall, not to see how far you can go on so many drops of gas."

The car is hardly a gas hog. It is rated at 50 miles a gallon, 10 miles better than its principal hybrid competition, the Honda Insight. The Insight was the best-selling car in Japan in April, costs less than the Prius and also seems likely to bedevil Detroit's comeback hopes.

A legion of Toyota brass explained during hours of PowerPoint presentations that the new Prius has been designed to elbow its way into the upper ranks of the U.S. passenger car market, where the No. 1 and No. 2 bestselling cars last year were the Toyota Camry and Honda Accord.

Toyota sold about 437,000 Camrys last year, while sales of the second-generation Prius lagged well behind, at about 159,000. Its buyers were mostly Americans in their 50s and 60s.

But even the new larger Prius faces tough challenges in the United States this year. Gasoline prices are running about $1.50 a gallon lower than last year, making hard-pressed consumers less likely to pay extra for a hybrid. And sales across the industry have been plunging. Prius sales in the United States fell to 10,091 in May, down 30.1 percent from May 2008. For the year to date, sales of the Prius in the United States have skidded to 42,753, down more than 45 percent from the first five months of 2008.

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