TOKYO (Reuters) -- Toyota Motor Corp. today said it would start taking orders in Japan for its first plug-in hybrid car, the Prius PHV, touting it as the world's most practical green car and aiming to steal thunder from pure battery-powered vehicles.
Unveiling the production-ready car ahead of the Tokyo Motor Show this week, Toyota said that the rechargeable Prius PHV would be priced from 3.2 million yen ($41,000) in Japan, higher than what it had flagged two years ago but cheaper than Nissan Motor Co.'s Leaf electric car, which costs 3.76 million yen before subsidies.
With Japanese government incentives, the Prius PHV will cost 2.75 million yen, Toyota said.
The car will be sold from next summer in Europe, at 37,000 euros in Germany. In the U.S. sales will begin next spring with a starting price of $32,000. Prices will vary across markets, Toyota said.
Toyota's new model adds an external charging function and more batteries to the popular Prius, to enable longer-distance driving on electricity alone. It uses high-capacity lithium-ion batteries that can be charged in 90 minutes using a domestic electrical source.
The batteries will be built in a joint venture with Panasonic Corp. and mark the first time that Toyota has used lithium-ion batteries in its cars. Previous Toyota electric vehicles have used nickel-metal hydride batteries.
Toyota aims to sell 60,000 Prius PHVs a year globally, including 35,000 to 40,000 in Japan, where deliveries will begin Jan. 30.
Because they can also run on gasoline, plug-in hybrids eliminate "range anxiety", which is seen as one of the main shortcomings of EVs.
Toyota said the Prius PHV can travel 26.4 km (16.4 miles) using only the electric motor, making a short commute possible on zero emissions. This is a significant improvement over the 2km range offered by the current model.
On a full charge and with a full tank of gasoline, the car could theoretically travel well over 1,000 km (620 miles).
According to the automaker, the plug-in Prius has a fuel consumption rating of 2.2 liters/100km (106.9 mpg US/128.4 mpg UK).
Its CO2 emissions of 49 grams per kilometer are almost half the emissions of the standard Prius.
"We believe it's the best-suited technology for widespread use," said Toyota Executive Vice President Takeshi Uchiyamada.
To test their viability, Toyota has leased more than 600 Prius PHVs since last year, mainly to governments and businesses in Japan, the United States and Europe.
Uchiyamada said one housewife in Toyota City who tested the car over three months drove on average 249 kilometers on one liter of gasoline, mainly using the car for shopping and other short-distance travel, and recharging it every time she returned home.
Strong Yen will hurt export sales
Toyota plans to introduce other plug-in hybrids as key vehicles for improving fuel economy and reducing emissions. It is positioning pure EVs as city commuters, with the first model due out next year.
Since introducing the first gasoline-electric car with the Prius in late 1997, Toyota has sold a cumulative 3.4 million hybrids worldwide.
The Prius PHV will be built in Japan, which could make it difficult to make money on exports. At current exchange rates, the car costs almost $10,000 less in the United States than in Japan. Toyota executives had said two years ago that the Prius PHV would be "affordable" and cost much less than 3 million yen.
The plug-in hybrid uses the same 1.8-liter gasoline engine and electric motor setup as the hybrid Prius.
In the summer, the plug-in Prius will join an expanded Toyota hybrid range in Europe that will include the Auris hybrid, the new seven-seat Prius+ and the Yaris hybrid.
With contributions from David Jolley