Toyota Cuts Price of Prius In Response to Drop in Federal Tax Credit
Toyota Motor Corp. is adding a 2008 model of its Prius gasoline-electric car priced 5.5 percent less than the current base version, as U.S. tax credits for the hybrid decline and regulators reduce its fuel-economy rating.
The new ``standard' Prius starts at $20,950, a drop of $1,225 from the lowest-cost 2007 model's $22,175 base price, Toyota said today in a statement. The new model doesn't include features such as cruise control and heated rearview mirrors that are standard on this year's base version, said Bill Kwong, a spokesman at the company's U.S. unit in Torrance, California.
``They've had a tremendous run with Prius and don't want to jeopardize that,' said Dennis Virag, president of Automotive Consulting Group in Ann Arbor, Michigan. ``This kind of pricing change is a smart adjustment on their part. It's also a bit of a marketing ploy because it's good to advertise a cheaper Prius.'
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