Toyota Motor Corp. on Monday launched its much-awaited new Prius gasoline-electric hybrid to face off against rival Honda Motor Co.’s Insight hybrid released in February.

Officially priced, as expected, at ¥2.05 million, the new Prius has already sparked a flurry of buy orders. The previous model, equipped with a less powerful engine, carried a ¥2.33 million price tag.

Despite the economic slump, Toyota said it has received orders for more than 80,000 units, compared with the 18,000 orders Honda received for the Insight in its first month.

Toyota’s strategy to slash the price of the remodeled third-generation Prius is paying off, experts say, noting the sticker price is now closer to the Insight’s, which grabbed consumer attention with a price of ¥1.89 million.

“We will provide what is good for society and the people at a price that many customers feel like paying,” Akio Toyoda, the incoming Toyota president, told a news conference at the company’s Mega Web showroom in Koto Ward, Tokyo.

Toyoda, grandson of the automaker’s founder, is currently an executive vice president.

“I want more people to feel comfortable buying a Prius,” he said, adding that all of Toyota’s 4,900 outlets nationwide will sell the new Prius and provide followup service.

The Prius will soon debut in more than 80 countries, including in North America and other parts of Asia later this month, Europe in June, and Central and South America, Africa, Oceania and the Middle East in July. Toyoda said the company expects sales of 500,000 to 600,000 units of all its hybrid models for the year.

So far, 1.25 million units of the first two Prius models have been sold in more than 40 countries since 1997.

The car giant also announced Monday it will lower the price of the older Prius to ¥1.89 million, the same as the standard Insight model, mainly targeting corporate clients.

Competition between the Prius and Insight is the only bright spot amid the global consumption slump and the crisis facing U.S. rivals General Motors Corp. and Chrysler LLC.

New tax incentives introduced in April to further promote eco-friendly vehicles are adding fuel to the sales. The new and existing incentives lower the taxes by ¥164,000 to ¥216,000 for the new Prius, Toyota said.

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