The Fit Hybrid went on sale with a starting price of 1.59 million yen (19,000 dollars), cheaper than any other hybrid vehicle in Japan. The conventional Fit is priced at about 1.2 million yen.

Honda's Insight hybrid is also priced below the two-million mark, making it the second cheapest in Japan.

The Fit has been launched as a direct competitor to Toyota's Prius, which has been Japan's best selling vehicle since May 2009. The Prius sells for a minimum 2.05 million yen.

Prius sales fell 14.2 percent year-on-year in September, according to the Automobile Dealers Association as government subsidies to encourage the purchase of environmentally friendly vehicles expired.

The Fit Hybrid model runs 30 kilometres (18.6 miles) per litre (0.26 gallons) of gasoline.

First launched in 2001, the car has proved to be a hit, with cumulative sales exceeding 1.5 million in September in Japan alone.

Sales of hybrids have been brisk in recent years because of rising petrol prices and increasing public awareness of global warming.

The new Fit is expected to give a boost to Honda as carmakers face slowing auto sales as a result of the expired subsidy programme.

earlier related report
Opel talks with Chinese investors on Antwerp plant: union
Brussels (AFP) Oct 8, 2010 - German automaker Opel, owned by US car giant General Motors, has agreed to discuss with Chinese interests the future of its Antwerp plant, slated to close this year, a union official said Friday.

"Talks are going to get underway immediately with Chinese investors," said Rudi Kennes of the FGTB union after a meeting between the plant's works council and Opel head Nick Reilly.

Kennes did not want to identify the Chinese investors involved but did say that Geely, which recently bought Volvo Cars from Ford Motor for 1.5 billion dollars, was not a party to the talks.

Geely officials visited the Antwerp site earlier this week, indicating an interest in its future, as the Chinese company embarks on an ambitious global expansion drive.

Opel declined to comment on the matter when asked.

A source close to the matter, however, said that discussions on the future of the Antwerp plant between Opel, GM and the new investors were in hand.

Kennes said an accord could be reached by the end of this year, when the plant is due to be closed under an Opel restructuring plan.

The Belgian plant employs around 2,600 people and was founded in 1924.

Opel chief executive Reilly said late last month that the company might look for another investor for the plant, perhaps in the logistics sector.

GM wants to cut its European auto production capacity by 20 percent and eliminate around 8,000 jobs from a total 48,000 so as to focus on Opel and its British sister brand Vauxhall.

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