Honda Motor Co. (7267) will end production of its Insight model, the first hybrid vehicle introduced in the U.S., after demand plunged and sales lagged behind Toyota (7203) Motor Corp.’s Prius.

Honda informed dealers in November that the current generation of the Insight will be discontinued this month and asked them to stop taking orders, Yuka Abe, a Tokyo-based spokeswoman for the carmaker, said by phone today. She declined to comment on whether there will be a new version of the model.

The Insight was the first hybrid vehicle in the U.S. market when Honda introduced it in 1999, seven months earlier than the Prius. The Toyota hybrid went on to become the best-selling dual-powered car of all time, with cumulative sales of 3.19 million vehicles as of January, according to the company.

By comparison, Honda delivered a cumulative 280,629 vehicles of the Insight globally as of the end of last year, of which 157,275 were sold in Japan. U.S. sales of the model plunged 18 percent to 4,802 last year, making it the second-worst selling car in the Honda brand lineup, behind only the CR-Z hybrid, according to researcher Autodata Corp.

Honda began this month with 237 days worth of supply of the Insight, according to Automotive News Data Center, almost four times the 60-day inventory that automakers generally consider to be ideal in the U.S. market.
Photographer: Haruyoshi Yamaguchi/Bloomberg

A visitor sits in front of a Honda Motor Co. Insight hybrid car at the company's showroom in Tokyo.

The Tokyo-based automaker stopped production of the first-generation Insight in 2006, before reviving it in 2009. Honda has five hybrid models in its lineup, including the Accord sedan and the Fit compact car.

It's been a rough ride for the Honda Insight, and now its journey appears to be at an end – word is that the five-door hybrid hatchback is going out of production.

The Insight nameplate was first introduced as a two-seat, three-door gas-electric hatchback just before the turn of the millennium, beating the Toyota Prius to market as America's first hybrid by over half a year. That original bantamweight Insight was discontinued in 2006, only to be revived in a larger, more Prius-like five-door form in 2009. But the new model never managed to keep up (let alone surpass) its rival from Toyota, which went on to become the best-selling dedicated hybrid car ever made.

As we reported just last week, Honda discontinued sales of the Insight (as well as its two-door counterpart, the CR-Z) in Europe due to lagging sales. But now word has it that the Insight is being discontinued altogether. The report from Bloomberg notes that the Insight hasn't amounted to even a tenth of Prius sales, and even then, well over half of those sold were in the Japan Domestic Market. Honda reportedly has 237 days' worth of inventory stockpiled, but dealers are said to have been told to stop taking orders.

We've inquired with Honda for official word on the Insight's fate here in North America, but have yet to hear back – we'll update you when we learn more. If the model is indeed dead, it won't be a surprise – we exclusively reported in December that it killing the model was on the table.

Of course, it's possible that the Insight will remain in production for a while to service other markets – potentially Japan only. The decision casts the future of the CR-Z into doubt as well, as the three-door model relies on a similar generation of Honda hybrid technology, and it's the only model in the automaker's lineup that actually sells fewer examples than the Insight. One way or another, Honda would still have its Civic and Accord hybrids to sell, not to mention the FCX Clarity fuel cell and Fit EV. Either way, it appears the Insight's days are numbered.

UPDATE: Honda spokesman Sage Marie tells Autoblog:

"The fates of Insight and CR-Z are not necessarily intertwined as they are very different models with very different missions. Moving forward, our hybrid vehicle strategy will focus on new hybrid models featuring expanded application of our innovative two-motor hybrid system with an eye toward significant volume growth. "

Honda Commits to the Expansion of Hybrid Vehicle Offerings in the U.S.

- Honda product strategy includes advancement of Earth Dreams™ Technology powertrains, including innovative two-motor hybrid system
- Strategy will include changes to existing lineup of environmental vehicles

TORRANCE, Calif., Feb. 28 – Honda is reinforcing its commitment to a clear product strategy focused on further advancing fuel-efficient and alternative-fuel vehicle technologies that are better aligned with customer needs and that strengthen the company's U.S. sales momentum.

Keyed to the continued rollout of a new lineup of Earth Dreams™ Technology engines, transmissions and electro-motive technologies, the strategy will be executed over the next three to four years and will include changes to the Honda lineup of advanced technology environmental vehicles, including the Honda Insight. The U.S. model Insight will be available at Honda dealerships nationwide through the end of the year, with production scheduled to end in summer 2014.

Honda's hybrid product direction in the U.S. will move forward with greater focus on expanded application of the innovative two-motor hybrid system. The two-motor system was introduced on the 2014 Accord Plug-In Hybrid and powers the EPA-rated 50 mpg city Accord Hybrid, which is the most fuel-efficient rating for a 5-passenger sedan in America.

"No manufacturer has more experience with electromotive technologies than Honda and we are committed to applying our expertise to a wide range of products in the coming years," said Michael Accavitti, senior vice president of auto operations at American Honda. "Our hybrid vehicle strategy will focus on new models aimed at delivering the class-leading fuel economy and performance our customers' desire in segments that represent significant growth opportunities."

The second generation Insight is the most affordable mass-produced hybrid vehicle on the market with a MSRP starting at $18,7251, and an EPA fuel economy ratings of 41/44/42 city/highway/combined2. It was introduced in the spring of 2009 and offered a unique blend of fuel-efficient hybrid performance, 5-door hatchback practicality, top safety ratings and a host of user-friendly features, including the first application of the Honda-exclusive ECO Assist™, a sophisticated feedback system that uses an adaptive color display to indicate overall driving efficiency. Long recognized as an affordable and practical hybrid vehicle choice for customers, the Insight was named a 'Greenest Vehicle' by the American Council for an Energy-Efficient Economy (ACEEE) for four consecutive years and a 'Top Choice' by Edmunds.com.