Does Toyota update Gen III mid year?

I'm in no rush to get a 2010, just by the end of the year. When TSB's start coming down do they make changes in production to eliminate those problems or do they wait for the 2011? There's talk that in September there will be iPod changes, would they make other updates as well?

What sort of iPod changes?

It isn't an iPod change, it's the release of an accessory USB iPod connector that works with NAV units.

And it's my experience that production improvements are ongoing, but particularly where a TSB has to address problems found in the wild, as it were. Based on the quality of the fit and finish of my Prius, I doubt there will be many TSBs by the end of the year.

Safety Connect and I think the debut of package I.

To my knowledge,the only change that has been announced has to do with the steering (for all cars but the Prius V, I believe). I think the change may be completed through a software revision, but I'm not certain.

The Safety Connect really is just a delayed debut, as opposed to a change. It was announced back in January, and even at that time Toyota said it would not be available until Fall 2009.

Yep, its part of the "Toyota Way" - [ame="http://en.wikipedia.org/wiki/Kaisen"]kaisen[/ame] (aka continuous improvement). An example is the change in the MFD in 2005 when they determined that there was an issue. Prius MFD

They don't wait until the next model year to make improvements. Some TSBs will list the VIN numbers that they apply to. (i.e. All 2004 models prior to VIN # xxxxxx)

I seem to remember a rumor that Prius III's with sunroofs (and nav) will be available later in the model year (2010).

It's not just Toyota--all car companies do this--they make running changes/modifications/improvements all the time, and introduce major changes in features/options/colors/etc. during the model year change overs.

What will they take out in the I? I assume the heated mirrors, cruise control, smart key entrance?

What if Ford had done this with the Pinto?

Ford Pinto - Wikipedia, the free encyclopedia

There may never be a prius I. I guess it just depends on how many sales Toyota thinks the insight is taking from them on the low end.

Uhmm.. You can currently buy a 2010 Prius III with Sunroof and Navi. (Maybe not in your area, but they are available across many markets in the US now.) List price, configured this way (assuming standard paint colors) is $27,350.