Since the iconic Toyota Prius hatchback launched in 2003, Toyota hasn’t really seen too much in the way of competition with the exception of the Honda Insight and Ford C-Max, and even then, those models probably haven’t cost the automaker too much sleep. With the fourth-gen Prius expected to debut later this year, Hyundai is hard at work coming up with a dedicated hybrid hatchback that can finally give the Prius a run for its money.

Codenamed the “AE HEV,” Hyundai’s new hybrid was recently spotted testing in Germany, and this car – along with its camouflage – doesn’t seem to have changed all that much since the prototype was last seen in January while being transported to the Arctic Circle. Those spy shots gave a unique vantage point of the hybrid’s undercarriage, but this latest round of spy shots shows some up-close details and even a quick shot of the interior.

Some of the more interesting design elements that can be made out from these photographs include horizontal grille slats, blue-tinted headlights and vertically arranged LED running lights. At the rear of the car, we can make out a similar vertical accent in the rear fascia, taillights that are positioned high on the body and what appears to be a big spoiler mounted to the liftgate. Normally, we would think this spoiler was just part of the camo to obscure the sleek shape of the car’s rear end, but the existence of a wide, LED brake light suggests this will be a production item.

It is believed that this new Hyundai model will ride on the same architecture as the next-gen Elantra, and it will pair a 1.6-liter four-cylinder gasoline engine with an electric motor powered by a lithium-ion battery pack. Output is unknown, but to be competitive with the Prius it would almost certainly have to outperform the current Prius’ EPA fuel economy ratings of 51 mpg city and 48 mpg highway.

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Why it matters

Hyundai hasn’t even confirmed the existence of such a model, but it is clear that a dedicated hybrid hatchback is on the way to give the Toyota Prius its biggest challenge yet. This Prius-fighting Hyundai hybrid is expected to debut in late 2016 for the 2017 model year and eventually offer an expanded lineup that will include a plug-in hybrid and various body styles.

Hyundai Prius Fighter - spy shots

Hyundai Prius Fighter Caught Testing In Germany: Spy Shots Exterior Spyshots
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Hyundai Prius Fighter Caught Testing In Germany: Spy Shots Exterior Spyshots
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Hyundai Prius Fighter Caught Testing In Germany: Spy Shots Interior Spyshots
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You can check our speculative review of the model here.

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