Interesting read.

Danny you could have been right when you said both G2 Prius and new 2010 being sold at the same time at different price levels.

Bloomberg.com: News

By Tak Kumakura
Jan. 19 (Bloomberg) -- Toyota Motor Corp. will cut the price of the existing Prius hybrid when the company releases a redesigned model in May, Nikkei English News reported, without saying where it obtained the information.
The new Prius, which has improved fuel efficiency, may be priced at 2.5 million yen ($27,551), the report said. The price of the existing model will be lowered to about 2 million yen, the Nikkei reported, without providing the current price.
Toyota seeks to compete with Honda Motor Co., which will release the Insight hybrid in February with a starting price of less than 2 million yen, the Nikkei said.

Re: The existing Prius will continue to be available

And it looks like there are enough in inventory to last for a bit.

Tom

I hope the 27551 is not the base price with no extra's. If thats the case,I will be getting the G2. Also, I think Toyota would be giving Honda a big boost.

Re: The existing Prius will continue to be available

Hmm, true, it's not very explicit. An interesting idea, though; better to eat one's own lunch than to let someone else eat it.

It will be interesting to see if this is a short term plan or a long term plan. Is Toyota simply reducing the price of any remaining 2G Prius to move them and clear space for the 3G or are they intending to continue production of the 2G to compete with the Insight? Time will tell.

I don't expect to see a 2010 2G Prius for sale.

With only one factory making Prius, it would be difficult to mix models on the same line. The 2010 Prius has structural changes and a different engine. The frame drives what can be built. The quantities drives what can be installed to make a profit.

Bob Wilson

Interesting article. I knew it would be a good time to purchase a gently used Prius II mid-late 2009.

Re: The existing Prius will continue to be available

But this:

suggests continued production. "Simplifying the interior design" means a change, and there'd be no change if they were just selling off units already built. It would make little sense to take existing cars and rip out the insides to "simplify" them in order to reduce the price.

This bums me out a little. I was hoping to trade my 2008 in on a loaded 2010 but with the lowered value of the lower model and the increased price point on the new one it may put it out of my price range. Maybe if I sold it now I would do better than in May. Anyone want a #5 SPM with 11K?
G

I think it is a counter punch from Toyota to Honda Insight.
The cost reduction version of 2G Prius market will be taxi and fleet area.
Toyota to sell 2G and 3G Prius concurrently - Yahoo Japan
(Japanese Yahoo article)

Ken@Japan

I'm with Bob on this one.

They barely can produce as many Prius as they should now, with only one model. Ok, I know the last few months were not so great, but I doubt they can produce enough G3 to satisfy demand while holding part of the factory to produce 2G.

I can imagine a good price reduction offer to clear stocks of 2G, but this should not last more than a month or two perhaps.

Having the 2G and 3G being done at the same plant at the same time, with all the logistics that would require, seems too overkill to me.

If the 3G is starting at $27,551 in Japan, it likely will push $30k here in US due to import tarrifs and taxes.

Green Car Congress has the following report:

The Nikkei reports that Toyota Motor Corp. plans to lower the price for the existing Prius hybrid when it begins selling the more fuel-efficient third-generation Prius (earlier post) later this year to counter Honda Motor’s new Insight hybrid (earlier post).

"Japan’s top automaker will continue to sell the existing Prius after the new version’s release in May. While the new Prius, which will boast improved fuel-efficiency, is expected to carry a hefty price tag, Toyota plans to cut the price for the current model to around 2 million yen. Rival Honda is slated to release the Insight hybrid in February, with a starting price of less than 2 million yen.

The new Prius will come equipped with a 1.8-liter engine, compared with the current 1.5-liter version, improving the car’s fuel efficiency 10% to 36-40km per liter. With this improvement, the price is expected to rise to around 2.5 million yen. The remodeled Prius will be offered through all four of Toyota’s sales channels while the existing version will be sold only through two."

Toyota will position the current Prius as a low-end model targeted at corporate users, simplifying the interior design to lower its price.

Sales of the Prius in Japan in 2008 rose 25% from 2007, to more than 73,000 units.
Green Car Congress: Report: Toyota Will Cut Price of Existing Prius to Counter Honda Insight
(The bold is Green Car Congress quoting Nikkei)

I find two things interesting. First that they mention corporate users. This makes me wonder if the 2G will be available to the general public or only for fleets sales. I also wonder if this will be worldwide or only in Japan.

The second is that they are going to simplify the interior. I can't see how they can take much out of the interior besides the touchscreen. The rest is pretty bare-bones as it is. Normal guages and simple knob HVAC like the Yaris? Maybe they will take the radio out as they do on the base Yaris.

BTW, 2 million Yen is currently $22,000.

For the first time ever I leased a car, my current Prius, to protect myself against this sort of eventuality. Of course this was not my main concern, being in Canada I was concerned what the inevitable fall of the Canadian $ against the US $ would do to used car prices. But if the G2 Prius continues in production at a lower price and that affects used prices, I'm protected too.

The 09 G2 is already advertised $4000 off MSRP from the local Toyota dealers on newspaper.
Toyota just make it a permanent price reduction.

The $27K likely be the silver package. Like you can't buy a base G2, the minimum is package 2.

I believe there are two factories in Japan assembling the Prius. I can't remember the names. It was also mentioned in one of the threads in PC.