In advance of the Paris International Auto Show in early October, Honda has released photos of its new entry-level hybrid car, which the press has (naturally) labeled the “Prius-fighter.” Reports indicate the Insight, a five-door family hatchback that is scheduled to hit dealership floors worldwide next year, is to be priced around $18,000, some $3,000 less than Toyota’s vaunted Prius gasoline-electric hybrid.

The new Insight will be powered by the latest iteration of Honda’s Integrated Motor Assist (IMA) hybrid technology, which will be significantly cheaper than its current systems, according to press reports. The IMA is a parallel hybrid system with an electric motor mounted between the engine and transmission to act as a starter motor, engine balancer and traction motor assist. The new, more cost-efficient powertrain accounts for the low price tag, making it potentially the most affordable hybrid model on the 2009 market.

The car itself, which is said to feature a roomy interior, shares styling cues with the company’s FCX Clarity, a hydrogen fuel cell-powered sedan that has garnered considerable green kudos of late. By 2010, Honda is expected to also launch a hybrid sports car and an all-new hybrid Civic.

It’s little surprise that Honda would fight back by coming out with a new Insight to vie with the Prius. The mid-size four-door sedan, has of course, been wildly successful. Its fuel-sipping prowess—46 mpg, according to the EPA—led to more than 180,000 sales in the U.S. last year. In the years since the Prius first went on sale in Japan in 1997 and was subsequently introduced worldwide in 2001, the car has firmly established Toyota’s environmental credentials.

Comparatively few remember that Honda, Toyota’s major Japanese competitor, brought out its own hybrid auto, the Insight, in 1999. Unfortunately for Honda, the all-aluminum two-seat coupe, which was rather cramped and odd-looking, did not sell well and was cancelled in 2006. The Tokyo-based carmaker also decided this year to stop building an unpopular Accord hybrid model. The reintroduced Insight is not doubt intended to get the company back on the green track.

That experience left a bad taste among Honda’s management, who considers their company’s green standing second to none. The Union of Concerned Scientists, for example, named Honda the ''greenest automaker'' in 2007 for the fourth straight time, because Honda's fleet had the lowest overall production of smog-forming emissions and global warming emissions.

Toyota, meanwhile reportedly will introduce several new hybrid models in the U.S. in 2010, including a reworked Prius, a minivan and a new Lexus, as well as some plug-in hybrids. These vehicles will likely get their power from an upgraded and lower-cost version of the firm’s Hybrid Synergy Drive, a powertrain that currently combines an electric drive, a gas engine and a continuously variable transmission.

Other car makers are also getting into the act: General Motors, for example, plans to introduce an early version of the Chevrolet Volt, a plug-in electric car, at its centennial party in Detroit next week. The Volt is scheduled for a 2010 market release. And Ford has a couple of mid-size hybrid models due out next year, while Nissan, Chrysler and several other car makers expect to unveil new hybrids of various types during the next few years.

For more: Are Hybrid Cars Too Quiet to Be Safe for Pedestrians?

photo of Insight courtesy Honda