The price of the new Toyota Prius has been slashed in Japan, so it can more closely compete with the recently launched Honda Insight.
The base version of the third generation Prius will now start at 2.05million yen (£14,500), which is less than the 2.33million yen (£16,000) it originally planned to sell it for.
The Insight has been a sales success in Japan since it went on sale earlier this year for 1.89million yen (£13,000).
The new starting price for a base model Prius matches that of a mid-range Insight.
Toyota announced last week that it will continue to sell the second generation Prius alongside the new model, with its 1.89million yen (£13,000) price tag exactly matching that of the entry-level Insight.
UK prices for the next generation Toyota Prius, which goes on sale in July, have yet to be confirmed, but are expected to start at around £18,500.
That's £3000 more than the Honda Insight, but the Prius hasn't traditionally attracted budget-minded buyers. In the past year almost 60 per cent of UK Prius sales were for the top-spec model, with only 25 per cent of buyers opting for the base car.