Top News 5 Page  1    The Toyota Prius Hybrid Car, a Major Hit in the U.S. The Second-generation Prius Shows Enhanced Highway Performance    | NOV. 1. 2004 |    Toyota Motor Corporation's Prius, a hybrid car, is selling like hotcakes in the United States. Actors and even politicians became devoted fans of the Prius, which further intensified public interest in this car. It has created a phenomenal situation, and there is now a waiting list of about six months for delivery.    The original or "classic" Prius was released in Japan in December 1997. According to a Toyota executive, it remained unclear at the time as to whether the hybrid car would be accepted by the market. There is a tax incentive in Japan for compact cars that fulfill size specifications. The classic Prius was designed as a compact car to meet these requirements, and sales were initially restricted to Japan. The Toyota executive also said that in terms of the balance between the drive of the gasoline engine and electric motor as well as the efficiency of its brakes, the original Prius was not exactly at its best. Furthermore, the car cost 500 thousand yen more than other compact cars of the same rank. What was important at the time was to put forth a corporate image as a company focusing on the environment. Toyota Motor introduced a hybrid vehicle, the Prius, in December 1997.The second generation Purius launched in September 2003 Popularity Accelerated by the Hike in Gas Prices    Despite such disadvantages, the classic Prius sold steadily, and contrary to Toyota's forecast, annual sales approached 30,000 units. In 2002, twenty thousand Priuses were sold in North America, outstripping sales in Japan. It was under such circumstances that Toyota released its second-generation model in September 2003. The 2004 model showed many improvements over the original Prius, but what should be noted is that Toyota targeted the U.S. market during development of the second-generation Prius.    First of all, it ignored Japanese specifications for the compact car and designed the body into the size of an American midsize automobile. Toyota also made the car more powerful by increasing the drive ratio of the gasoline engine in comparison with the electric motor. The move to make the car more gas-engine intensive was to enhance highway performance since there is a strong demand in the U.S. to drive cars over long distances. However, the initial sales plan for the second-generation Prius was for slightly under 80,000 cars, divided pretty much equally between sales in Japan and sales abroad. The recent hikes in crude oil prices have created an all-new situation for Toyota. Is a New Round of Japan Bashing Imminent?    Although gas prices in Japan have risen by more than 20 percent, there has not been much decline in the amount of gasoline consumed. Reasons include the fact that Japan consumes less gasoline than America to begin with and as such has been a more energy-saving county than the U.S.    The average amount of gasoline consumed per car in Japan is less than half that of America. For one thing, the Japanese automobile market is centered on the more fuel-efficient compact car, and the country is also small so the distance driven is usually less. As such, it has been affected less than the U.S., which consumers more gasoline, through the hike in the price of crude oil. This can be said to be one of the reasons why the hybrid car is in a greater spotlight in America as compared with Japan.    Toyota expanded its production line for the Prius this summer by 60 percent, and it will be manufacturing 130 thousand Priuses per year. The company plans to allot half this number for sales in the U.S. market.    America's big three car manufacturers do not admit this, but it is now common knowledge in the automobile industry that the technological capabilities of Japanese car manufacturers have already surpassed the U.S. The leading positions Toyota and Honda hold in the development of hybrid cars is a prime example. No matter how popular they may be, there is still a danger that Japan bashing will rekindle in the U.S. if too many Japanese cars are exported to the United States. Toyota is waiting to see the run of events before making decisions related to future production hikes of the Prius. See the following for more details on Toyota's environment-friendly cars. http://www.toyota.co.jp/en/tech/environment/fchv/index.html