The dire straits of the auto industry notwithstanding, the "hybrid war" between rivals Toyota and Honda appears to be full on! Both the automakers are going all out to promote their hybrid cars, as they launch in quick succession.

With each of the two - Honda and Toyota - committed to upping the sales of their respective gas-electric models, the related proceedings are more than interesting, what with Honda's new Insight pitted against Toyota's soon-to-be-released third-generation Prius.

The arguably `fun to drive' Insight boasts of fuel economy - with 40 miles per gallon for city driving and 43 mpg on the highway - and a less than $20,000 sticker price. In comparison, the latest Prius is not just bigger than its Honda rival, but also boasts of better mileage, and an EV mode, whereby the driver can direct the car to run solely on battery power - all this at a higher US sticker price, starting at around $23,000!

However, to compete in the Honda Insight price range, Toyota has come up with an unusual move of selling an economical, sub-$20,000 Prius version alongside the new one, as announced by Toyota CEO Katsuaki Watanabe. At the unveiling of the new car for the Japanese market, Watanabe said: "That Honda has come out with a wonderful car like the Insight gives us a big impetus to try to be more competitive!"