HONDA'S new Civic hybrid is expected to go on sale for less than £15,000 when it reaches the UK in May.

It means the car will undercut its rival from Toyota, the Prius, by nearly £1,500. So far Honda and Toyota are the only manufacturers to have launched petrol-electric hybrids in the UK, Honda with the Insight and Toyota with the Prius.

Both are eligible for £1,000 grants under the PowerShift scheme, and the new Honda Civic IMA (Integrated Motor Assist), is also expected to qualify. Honda predicts combined fuel consumption of more than 50mpg with carbon dioxide emissions of about 120g/km for the Civic IMA.