Toyota is not a frivolous attention seeking company. Everything that the company does needs to be justified by strong business rationales, supported by market demand data. And yet, Toyota hosted the Southeast Asian debut of the fifth generation Toyota Prius in Bangkok earlier in March, despite having no immediate plans to launch the hybrid-exclusive model in this part of the world.

Nine months after the Bangkok Motor Show, Toyota Chairman Akio Toyoda’s privately owned OCR Rookie Racing team added a third car – a yet-to-be-launched GR variant of the Toyota Prius - to the entrants list for this weekend’s Idemitsu Super Endurance Southeast Asia Trophy at the Chang circuit in Buriram, Thailand.

The racing Prius is part publicity exercise, part development work for a new hybrid engine that runs on carbon neutral synthetic fuel, while retaining most of the standard car’s hybrid hardware.

Akio Toyoda will be racing the Prius under his Morizo pseudonym, sharing driving duties with Kachorn Chiaravanont, a family member of the clan behind Thailand’s conglomerate Charoen Pokphand (CP) Group, which has since become a partner of Toyota’s carbon neutrality projects. The CP Group will supply hydrogen fuel to Akio Toyoda’s other race car, a hydrogen combustion engine GR Corolla. The hydrogen fuel is generated from the CP Group’s massive chicken farm’s manure.

Behind the Rookie Racing pit garage lay an expansive exhibition area where not one, but two Priuses were put on display - a standard Maximum Yellow colour Prius, the same car that debuted in Thailand in March, and a modified Prius 24 hr Le Mans Centennial GR Edition, shown for the first time outside of Europe.

The ASEAN debut of the Prius in Bangkok in March 2023 was thought to be a one-off, for reasons best known to Toyota. The second appearance of a Prius, the one racing this weekend, may be a coincidence. But when you have a third and fourth appearance, the two Priuses on display, this can only be seen as a pattern. Toyota is not a company that will put multiple units of the same model in the same location if they are not serious about introducing it.

Like Malaysia, Thailand never got the fourth generation Prius, and the third generation model was the only Prius that was sold there. The fifth-generation Prius’ sexy body has generated a lot of interest from the public, and judging by the exhibits, it’s an interest that Toyota is actively stoking further.

When asked by the Thai press if the Toyota Prius will be launched there, Chairman Toyoda mischievously said, “Maybe it depends on the results of this race, please cheer for us.”

It’s not the answer many expected, but the important thing is that he didn’t say ‘No.’

At the same time, we need to remember that Akio Toyoda has since stepped down as President and in his current position as Chairman, he no longer has executive powers, so we shouldn’t take his comments on day-to-day operations of Toyota too seriously.

We then posed this question to Masahiko Maeda, Toyota’s CEO for Asia Region.

“All this (high interest in Prius) started with the wonderful reaction and feedback we received from customers in Thailand when we displayed it at the motor show. And this is a very good example of where we get our source of energy, and what motivates us to work very hard," he said.

However, Maeda also tempered expectations by saying, "But when you really think about marketing something, launching something, the production phase in ASEAN, any new product will have to be thought through very thoroughly from many perspectives, including government policies in each country or region, as well as the taxation framework.

“For the product to gain popularity and attract many users, it's very important that it be affordable. In that sense, hybrids are more affordable than BEVs (before it’s skewed by taxes). Obviously, when it’s more affordable, we will have more users, and the collective aggregate performance (in carbon reduction) we will be able to contribute to carbon neutrality more. The unfortunate backdrop is that in many governments, we are seeing that they have selected BEVs as the only solution,” said Maeda.

Maeda’s comment can be interpreted as:

1. Thailand may likely launch the Toyota Prius between the near- to mid-term. It’s not yet confirmed but the demand is obvious. There are still some issues to work through, but these are not insurmountable issues.
2. In some countries like Malaysia, which continues to impose high taxes on hybrids, especially imported ones, it wouldn’t make sense to launch the Prius there because taxes have reversed the order of affordability, resulting in higher cost but tax-exempted BEVs to be sold cheaper than lower cost hybrids.

Malaysia ended its tax exemption for imported hybrids on 31-December 2013 and in 2022, waived import, excise, and road tax for battery EVs (BEVs).

Meanwhile, Thailand continues to support hybrids even as it slashes taxes for BEVs. Hybrids emitting less than 100 g/km of CO2 have their excise tax cut from the regular 25% to just 4%, while those emitting between 101 to 150 g/km are taxed at 8%. BEVs have an excise tax rate of 2%, half as much as the lowest tax bracket hybrid.

The fact that fuel is unsubsidized RON 95 petrol is priced at RM 4.84 per litre (today’s rate, Shell) also means that Thai customers don’t need a lot of convincing to go hybrid (or BEV).

This explains why recent models like the Toyota Yaris Cross are launched in Thailand exclusively as a hybrid, while the Toyota Corolla Cross is offered as a hybrid 3 of the 4 variants. Only the cheapest variant is a non-hybrid.

Ultimately, Toyota must make a business decision. A Toyota Prius can only be launched in a country where there are enough buyers to welcome it.

In terms of the customer’s impression of the product, a Toyota Prius cannot be priced higher than a Tesla Model 3. In the US, a Tesla Model 3 starts at USD 28,490 (~RM 132k), after a series of massive price cuts. The Toyota Prius starts slightly lower, at USD 27,650 (~RM 128k). For reference, the Toyota Camry 2.5L starts at USD 26,420 (~RM 122k).

However, you may also want to know that unlike the heavily discounted Tesla Model 3, very few Toyota Prius are sold in the USA at their listed price. USA is a free market and due to the extremely strong demand for the latest generation Prius, most Priuses are sold there above the listed price, sometimes up to 30% higher.

Anyway, that’s the situation in USA, not here. Realistically speaking, buyers in Southeast Asia have not reached a point where they can accept a Prius to be more expensive than a Tesla Model 3.

The fifth generation Prius is available with 3 different powertrain options – all with a new fifth generation hybrid system. The entry 2ZR-FXE 1.8-litre is using the same engine as before, but with lighter and more compact fifth generation hybrid hardware. One rank up is the M20A-FXS 2.0-liter Dynamic Force engine variant. It makes 196 PS. The highest range PHEV variant (same 2.0-litre engine) makes 223 PS, and is capable of sprinting from 0-100 km/h in a rather un-Prius-ly 6.7 seconds.

If a Prius is supposed to be priced above a Camry and an imported-from-Thailand Camry is already priced in Malaysia at RM 219,800 here, expect the imported-from-Japan Prius to be priced close to RM 250,000, so it’s clearly dead-end for Malaysia. Isn’t that sad? Just look at the car’s gorgeous body!