Honda's 70-MPG 2011 Fit Compact Car Will Be Lowest-Priced Hybrid Sold in Japan

Honda's 70-MPG 2011 Fit Compact Car Will Be Lowest-Priced Hybrid Sold in Japan

Kyodo News reports that Honda Motor Co. has decided to sell its new hybrid car for around 1.59 million yen (about $18,600), which will be the lowest price for a gasoline-electric vehicle sold in Japan, according to company sources.

The Japanese publication said the price of Honda's new Fit compact car (pictured), to be released in October, will be some 300,000 yen ($3,492) lower than the 1.89 million yen ($20,960) price tag for the cheapest model of its Insight hybrid put on sale in February last year.

The move is expected to accelerate competition in the development and sale of environmentally friendly vehicles between Honda and Toyota Motor Corp., which is expected to release a new compact hybrid next year that will achieve 40 kilometers per liter (94 mpg U.S.) on gasoline and have a price tag of around 1.5 million yen ($17,460), Kyodo News reported.

The new Fit will feature a 1.3-liter engine and electric motor, with fuel economy of 30 kilometers per liter (70.6 mpg U.S.).

Analysts for IHS Automotive, in an email to Green Car Advisor, noted that this will be Honda's fourth hybrid offering in the Japanese market after its Civic, Insight and CR-Z models.

They also noted that the Fit hybrid will be priced almost 300,000 yen ($3,492) lower than the segment's top-selling Toyota Prius hybrid. However, the model will be almost 400,000 yen ($4,657) costlier than the existing Fit subcompact.

With the launch of the Fit hybrid, Honda intends to increase sales of its hybrid vehicle line-up in Japan following lackluster demand for its Insight hybrid in the country over the last several months. Honda sold only around 26,000 units of its Insight hybrid in Japan during January-July, almost one-tenth of the 204,882 units sold of the Prius hybrid  during the same period.

Scott Doggett:  is an AutoObserver.com Associate Editor.