The fight between Toyota and Honda is taking a step forward: Toyota has a new ace in its hand: a new small hybrid car to take on the Insight. it will be based on the Yaris and will be cheaper than the Prius. Debut will be made in early 2011.

Akihiko Otsuka said in an interview with Automotive News: "We are developing a low-priced hybrid vehicle like Honda’s Insight. We are going to compete by expanding our hybrid-vehicle lineup to smaller hybrids, in the class of the Vitz [sold in Japan] and Yaris."

If the current Prius is using a nickel-metal hydride batteries, the future model will move to lithium ion because they are lighter and more powerful.

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Source: Automotive News

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