Honda Motor Co said on Wednesday it would launch a new low-cost, hybrid car in Japan, North America and Europe in early 2009.

Despite the pressure of record-high oil prices and concerns over climate change, fuel-efficient and low-emission hybrids still occupy a small niche in the global car market, partly due to their high costs for both consumers and automakers.

Japan's top two automakers -- Toyota and Honda -- lead the industry in the fuel-saving technology that runs on both electricity and gasoline, but Toyota has dominated sales with its immediately recognisable Prius model, which is only available as a hybrid.

"It is important to move hybrid vehicles from the current image-oriented stage to the new stage toward full-scale penetration," chief executive Takeo Fukui told a news conference.

By twinning a conventional engine and battery-powered electric motor, hybrids currently add $5,000 or more to comparable gasoline models, a premium Fukui hopes to bring down to around $2,000 in the next generation of hybrids.

Executive vice president Koichi Kondo said Honda hoped to price the hybrid-only car under 2 million yen ($19,290).

Honda now only sells one hybrid car -- a gasoline-electric version of the mass-volume Civic sedan which  starts at around 2.3 million yen -- after discontinuing its hybrid-only Insight two-seater in 2006.

In addition to the Civic hybrid, the new hybrid-only car and a planned sports car based on the CR-Z concept model, Honda will add a hybrid version of its popular Fit subcompact, Fukui said.

With the four models, Honda expects annual sales of 500,000 vehicles combined some time after 2010, or roughly one-tenth of its total fleet.

Honda had promised the hybrid-only car for launch some time in 2009, with projected annual sales of 200,000 units, after drastically reducing production costs and making them more affordable for consumers.

Announcing other details of the new hybrid-only car for the first time, Honda said the car would have five doors, seat five people and share a design concept with its sleek, FCX Clarity fuel-cell vehicle.

The car would use more compact and lightweight components for the hybrid system and have a newly developed vehicle platform that places the control unit and battery underneath the cargo space.

A new production line for electric motors will also be added at Honda's Suzuka factory, south of Tokyo, to more than double the production speed. The line would start operations at the end of 2008, raising annual capacity to 250,000 units from the current 70,000 units. Further expansion is possible to accommodate future growth in demand, Honda said.

Toyota is also racing to slash production costs for future hybrid cars. It has not disclosed when the third-generation Prius would be ready, although many expect a 2009 launch. - Reuters