The article incorrectly said that Americans began purchasing the hybrid vehicle in 1997. The Prius was not available in the United States until 2000.
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Toyota Wants New Prius to Be America's Next Top Model
Moreover, Honda has crafted an ad campaign designed to appeal to younger car buyers, an audience Prius has had trouble reaching. The campaign -- whose slogan is "The hybrid for everyone is here" -- features popular music and images young people driving to an outdoor music concert or to the beach.
Prius engineers and designers said that cracking open the family-sedan market in these environmentally stressful times is not yet a job that an all-electric car can handle.
Battery technology has not developed to the point where it can provide most commuters with the range, acceleration and comfort they demand, said Masatami Takimoto, an executive vice president in research and development.
"Fundamental issues are unsolved," he said, noting that Toyoto sees gasoline-electric hybrids like the Prius -- not all-electric, plug-in cars -- as the "core" of its future, at least until there are significant breakthroughs in battery development.
The company, though, is hedging its bet by investing heavily in a joint battery project with Panasonic, and it plans to sell a small all-electric car by 2012.
While Toyota sees the hybrid as its main meal ticket for the medium-term, General Motors is hoping to move beyond hybrid technology with the Volt, which it calls an "extended-range electric vehicle."
Its batteries can take the car 40 miles between charges and a small back-up gasoline engine can take it more than 300 miles. But the estimated cost of the Volt, which GM expects to bring to the market late next year, is about $40,000. The third-generation Prius is selling for between $22,000 and $28,000, depending on options.
In its all-electric mode, the Prius can go 1.2 miles.
Toyoto, in effect, says so what?
Its designers say they have made a gas-sipping, low-emission car that's fun to drive, accommodates large people in the back seat and has room in the trunk for three golf bags.
If the Prius proves as popular in the United States as it seems to be in Japan, Toyota does have a problem, company officials acknowledged. Collapsing U.S. car sales in the past year forced Toyota to put off plans to open a factory in Mississippi that could assemble the Prius.
"Yeah, supply is going to be an issue," said Nolasco, the company spokesman.
Staff writer Steven Mufson contributed to this report from Washington.