Toyota dealers in Japan received 80,000 orders for the latest version of the carmaker's Prius petrol-electric hybrid ahead of its official launch yesterday, a much higher volume than expected as the company had cut prices to fend off a challenge from its emerging green-car rival Honda.

The enthusiastic response to the third-generation Prius, which Toyota will begin selling outside Japan in a few weeks, appeared likely to propel it to the top of the domestic sales rankings – a feat achieved for the first time by a hybrid last month, when Honda's revived Insight became Japan's best-selling full-size car.

Toyota has dominated the hybrid segment since it introduced the Prius in 1997, but its engineers have called the Insight, a redesigned version of a car Honda had scrapped in 2006, its “first real competition”. Honda is offering its car for Y1.89m ($19,600) for the most basic version, the lowest price yet for a dual-powered vehicle.