The controversy surrounding the true environmental benefits of hybrids is still raging, but as a piece of engineering the new Prius is superb. It marks a significant leap forward in refinement and driveability, although it’s still not much fun from behind the wheel. The sharper styling is an improvement, but aerodynamic requirements dictate the awkward-looking profile. It’s still not cheap, but with prices frozen over from the current generation car, loads of extra equipment and rock-bottom running costs, the Prius does boast real value for money.

Love it or loathe it, the Toyota Prius changed the car industry forever when it brought hybrid motoring to the masses back in 1997. Now in its third generation, the new Prius has already proved a huge hit in Japan, outselling every car on the market in its first month. But is it good enough to win over European customers?

The headline figures are combined fuel economy of 72.4mpg and CO2 emissions of 89g/km. That’s a 10 and 14 per cent improvement respectively, while combined power output has leapt by 24 per cent to 134bhp.

Video: watch CarBuyer's video review of the Toyota Prius

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Sharper creases in the bodywork and Nissan 370Z-style boomerang headlights have gone someway towards improving the previous car’s appearance. But in Toyota’s quest for a super-slippery drag-coefficient, the curved roof and lumpy rear proportions have been carried over.

Around 90 per cent of the mechanicals have been redesigned to be lighter and more efficient, but essentially the engine and electric motor combination works in the exactly the same way – providing power in tandem for the most part, and running off just the batteries at low speeds.

Drivers can now choose from three driving modes. EV allows electric-only driving for up to two kilometres, while Eco and Power adjust throttle response to either save fuel or boost overtaking ability.

On the move there’s a marked improvement in acceleration and refinement. The extra weight from the battery pack doesn’t inspire confidence in corners, but on the whole it’s a sure-footed and comfortable cruiser.

The completely redesigned interior features such gadgets as a fighter-jet style head-up display, adaptive cruise control and a touch-sensitive controls on the steering wheel. But if you really want to impress, there’s an option of a solar-panel roof which powers a fan to keep the cabin cool and a park assist system, which steers the car for you into tight spaces. Overall, the new Prius is by far the best hybrid on the market.

Rival: Honda Insight
Honda has really put the cat among the pigeons with the Insight - undercutting the cheapest Prius by £3,000. Unfortunately the cost-cutting shows in the interior and it can’t quite match the Toyota on fuel economy or emissions.