Honda is coming out with a Fit hybrid. Hence, this is Toyota's response.

English version:

REPORT: Toyota to build Yaris-based hybrid in France, go on sale in Japan in 2011 — Autoblog

"based on the next-gen Yaris platform and due to go on sale in Japan for 1.5 million yen ($15,760) by 2011 ... featuring a downsized four-cylinder engine that may make it even more fuel efficient than its larger sibling." (less mass, smaller engine should equal better mpg)
"It's expected that the new Yaris-based hybrid will go head-to-head with Honda's recently announced Fit Hybrid."

Prius vs Insight
Yaris hybrid vs Fit hybrid
MR2 hybrid vs CRZ hybrid
The hybrid wars are heating up!!!
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Will it be as stripped-down and no frills as the regular Yaris? Will it get poor crash ratings from Consumer Reports (like the regular Yaris)?

Just disappointed in the Yaris in general.

Seriously? (rhetorical) Right after I join Priuschat I see this.... and I've been waiting on this to happen for a while now.

It's a good response though, despite whatever downfalls Toyota might conceivably recieve, as in: like Honda having multiple hybrid offerings could take sales away from another or just be downscale and not appeal to upper middle class customers.

It seemed to me Honda had launched an assualt on Toyota though, by maintaining the Insight, Civic Hybrid and Fit Hybrid at the same time while announcing that in late 2011 there'll be a CRZ sport hybrid all for sale at the same time. Reviewers keep saying the marketing guys will have to juggle these models very carefully in order to ensure that one doesn't cancel out the other, but as we know they are each for different purposes and besides, it's Honda's intention to rack up overall hybrid sales and reap the benefits of the total number of hybrids sold.

That's how I see it. For instance the Prius was made for the purpose of showing how a hybrid could have room, comfort and decent performance while still getting good mileage; as opposed the first Insight which only got good mileage and didn't offer anything in terms of comfort. The new Insight is here to showcase Honda's ability to do something similar but there are still small hybrid offerings from both companies serving another purpose: good gas mileage for those who can't afford a $30,000 upscale car with bells and whistles.

My main concern is, is Toyota ready to put the Hybrid Synergy Drive into a mass-affordable car?

The Yaris is targeted towards thrifty buyers who can't afford bigger, more expensive cars, and if the Yaris hybrid is going to cost $3000 more than the standard Yaris, I doubt it will sell. And if it doesn't sell, it's would be a step backwards.

Personally, I'd rather see Toyota take its time to do it right rather than purely reacting to Honda's plans. Either improve the manufacturing process to cut costs so the HSD is cheaper to make (and thus significantly cut the "hybrid premium") or further refine the HSD to make the "hybrid premium" worth the money in the mass consumer's eyes.

I sure as hell hope so.

I drive a Corolla CE, the least expensive model, which had an MSRP of $14,999 (in 2004). I see an EQUAL number of Corolla-S models, which had an MSRP of ~$17,999. In other words, I see just as many $18K Corollas as I do $15K Corollas on the road. I drive a lot - I have 116K miles on my 2004 Corolla - and I get a very good sampling of what cars are on the roads (here in Southern California). I don't think the $3000 difference is going to cripple sales.

As far as reacting to Honda, I don't think Toyota is viewing the Insight as a threat in any way, shape or form. A Fit hybrid? Maybe. I say maybe due to a comparison of Civic sales to Civic hybrid sales, with consideration to Fit sales. But I don't think Toyota needs to worry about doing a rush job and getting things wrong. Toyota spent ten years evolving and improving their HSD technology while Honda was on the sidelines.

I think Toyota is an an excellent position to create and produce a Yaris hybrid.

Small hybrids -- I've been waiting a long time.
If systems like the Enginer.us plug-in pan out, we will be able to but PHEV lites for about $20k before tax credits.

I have my fingers crossed. This could be a tremendous fuel economy advance in not much more than 5 years.

I'm not so sure you can directly translate the Corolla trim level costs to the Yaris.

Remember that the Yaris is targeted towards thrifty consumers who could not afford a bigger/more expensive car. If the prospective Yaris buyer has an extra $3000 to spare, he would most likely be looking at a roomier car like the Corolla instead of a Yaris hybrid!

That is why I am a bit skeptical about a Yaris hybrid selling well unless Toyota can drop the "hybrid premium" below $1000.

Right now the biggest hurdle IMHO to widescale adoption of hybrids is the consumer perception of the "hybrid premium" and that it takes years to recoup through gas savings. If Toyota can make the "Hybrid premium" a non-issue, then I can see the Yaris hybrid be a runaway hit.

I think: even if we don't assume this is a reaction to Honda it still makes sense for a lot of other reasons. I have always thought fuel efficient cars SHOULD be small and lightweight, as in 2,000 lbs. or less and that there are lots of 3,000 lbs. plus hybrids out there seemed like a fluke at first. Obviously it's not a fluke.

Hasn't Toyota put all different sizes of engines together with the Hybrid Synergy Drive, and done so successfully? So to me it makes sense that Toyota could use it's smallest engine or possibly even a small-bore derivitive of an already little engine together with the HSD to make a much lighter vehicle very efficient. You guys are the experts; I'm just guessing.

The smallest gasoline engine Toyota has mated to the Hybrid Synergy Drive is the 1.5-liter, used in the 1st- and 2nd-generation Prius. The same engine as the Yaris, as a matter of fact, except the Prius version uses the Atkinson cycle (Otto cycle in the Yaris). The Prius is definitely no lightweight though, at 2800 pounds (1st-gen), 2900 pounds (2nd-gen), and 3000 pounds (3rd gen).

I would imagine Toyota would stick with a 1.5L for a hybrid Yaris rather than use an even smaller engine so the 1.5L can run at lower revs for better fuel economy (same reason why they went to 1.8L for the 3rd-gen Prius).

At today's gas prices, your point is well taken. However, when we go back to $4/gal plus and more, the decision will change for all buyers, especially entry level buyers. I don't think there is any question gas prices will increase considerably again, but when is anyone's guess, I could believe anything from 1 to 5 years from now. What gas prices will do is the $64K question for all automakers.

Right.... because smaller isn't always better, especially if it has to work extra hard to get the job done.

There's no use in getting into the what if speculation game either.

My point was that there are just as many people that can [only] afford a 15K car as there are people that can [only] afford an 18K car.

You can disagree with me, but I think that there are a lot of people in the "18K" bracket that wish they could buy a new Prius for 18K, but unfortunately they cannot. These people really, really want a hybrid, but at their income level, they cannot afford one.
Although it would not be a $9999 car or a $15K car, at $18K it would be accessable to a far greater market than the $22K++ Prius. Maybe, down the road, say in 2016, a $15K hybrid may become viable. But until then, let's get this 18K Yaris on the production lines!

Think of a pyramid.

Yaris Diesel in Europe has a price premium of more than 1500 EURos over a petrol one or more than 2000 US Dollars. So if it makes sense to make a Diesel Yaris variant which sells quite well (I know as I owned two of them allready), it also makes sense to make a hybrid.

As emission standards go up in Europe and around the world and price of making a diesel up to standards (expensive particulate filters and deNOx catalitic converters in exhaust system), hybrid will be a very good alternative. Hybrid has a prospect of having even lesser consumption than diesel, yet much better emissions, less expensive maintenance and much higher reliability. Plus as hybrid components hit mass production hybrid version has a very good prospect of actually being less expensive to be manufactured compared to modern diesel variant.

Just my 5 Euro Cents.

Isn't it true that diesel is cheaper in Europe because gasoline is taxed a lot more heavily, which is why diesel cars account for 50% of all cars sold there?

I guess I'm wondering if that works against gasoline cars and gasoline hybrids (and by extension the prospects for success of a Hybrid Yaris).

So if this is true, then a diesel hybrid in Europe makes a lot of sense, right?
(especially, with fuel being very expensive in Europe)

I don't think a diesel hybrid will ever be made. It will not have lower CO2/km, but will have more reliability problems and of course be quite a bit more expensive.