Honda's Cover Brand!

Right now, there are not many businesses loonier than the auto industry- unless you consider the sales gyrations of hybrid electric vehicles. For example, Toyota’s iconic Prius enjoyed cult status and brisk sales, especially when gas prices soared past $4-gallon. Now with fuel prices hovering just over $2, hybrids seem to be as fashionable as Nehru jackets.

If designing and producing new cars were as simple as men’s clothing, the swings in consumer demand wouldn’t be a big deal. But aside from the voracious amount of cash it takes to bring a new car to market, the lead-time is at least three years from pencil sketch to launch.

With this in mind, Honda’s very Prius-looking Insight will either become a brilliant strategy or one more new model in a crowded marketplace. The result depends upon how much higher Toyota prices its 2010 Prius and if gas prices decide to take another leap upward.

Perhaps the most surprising attribute of the new Insight is its rather modest ambition. Honda introduced the contemporary hybrid electric vehicle with a little two-door coupe carrying the Insight badge. And company executives were chagrinned when sales of Toyota’s Prius were far higher than its Civic Hybrid, and vowed to do something about it.

Some of us thought Honda would shoot for amazing fuel economy and Star Wars style. Instead, the Insight looks so much like its rival, that many people I encountered during a week’s driving thought it was the newest Toyota. Then when they discover that the newest hybrid Honda gets the same fuel economy as the current Civic, and less than Toyota’s current offering, many are truly perplexed.

So where’s the win? The Insight’s advantage is a sportier ride and crisper handling than its rival. Our test car had paddle shifters behind the steering wheel and performance around twisty roads that would leave a Prius in the dust. And the suggested retail price is nearly $2,000 less than a comparably equipped Prius. Honda’s betting that the price advantage will work in its favor and that gas prices will make a move up.