TOKYO: Toyota Motor Corp. on Monday rolled out its revamped Prius hybrid, which will cost less in Japan than its predecessor model as competition heats up with Honda's rival hybrid, the Insight.

Toyota aims to sell 300,000 to 400,000 of the new Prius worldwide a year.

The Japan price for the Prius, which starts at 2.05 million yen, or about $21,600 at current exchange rates, is cheaper than the previous model sold here.

But in an unusual move aimed at competing against the Insight, Toyota also said it will continue to sell the current Prius in Japan - and cut its price. It targets rental and corporate customers, and will sell for 1.89 million yen, the same price as the Insight.

Toyota started its global launch of the world's top-selling hybrid in a ceremony in Tokyo where the automaker's incoming president, Akio Toyoda - grandson of the company's founder - drove onto stage in the new Prius.

He said the model embodies his company's hopes for what a more ecologically conscious world may demand in a car.

"We are resting the future of cars in this model," he told a packed crowd at a Toyota showroom.

Toyota had already given the U.S. prices for the 2010 Prius - starting at $22,000, unchanged from the base price for the 2009 model. It is also promising a more basic U.S. model as well for later this year starting at $21,000.

The Prius, now in its third generation since its 1997 introduction, and the executive in charge of the debut event, are both symbolic of Toyota Motor Corp.'s pursuit of a turnaround from its worst annual loss since its 1937 founding.

Toyota - which also makes the Camry sedan and Lexus luxury models - has long been the leader in the hybrid market, having sold a cumulative 1.256 million Prius cars in more than 40 nations and regions, making the model the top-seller among hybrids.