Toyota Motor will begin selling "affordable" plug-in hybrid cars in 2011 to challenge General Motors and the Renault-Nissan alliance in the race for the lead in the field of rechargeable cars.

Toyota's first plug-in model, the Prius Plug-In Hybrid (PHV), adds an external charging function and more batteries to the popular Prius to enable longer-distance driving on electricity alone.

Because it can also run on petrol, the plug-in hybrid - such as GM's upcoming Volt due for sale next year - eliminate the "range anxiety" seen as one of the main shortcomings of battery-only powered electric cars.

Toyota said it aims to sell several tens of thousands of PHV cars at a price of around EUR33,700 according to executive vice president Takeshi Uchiyamada, Toyota's R&D chief and 'father' of the original 1997 Prius sedan.

The current Prius hybrid sells for around $22,400. Uchiyamada added that mass-produced PHVs may not take that car's shape.

Toyota has launched its European PHV demonstration programme with the hand over of the first of its new generation European Prius models. The project is managed in partnership by the carmaker, EDF, and Strasbourg.

The programme involves about 100 PHVs and is part of Toyota's pan-European PHV limited lease programme, through which about 200 vehicles will be provided to public and private customers in more than 10 European countries including France, UK, Portugal, The Netherlands, and Germany.

Uchiyamada said: "The plug-in hybrid technology is a key driver on our road towards sustainable mobility. PHV represents today the most practical way of increasing the use of electricity for personal transport. Now we need to investigate market acceptance of this new technology."

The project has received financial support from the research fund managed by the French environment and energy management agency ADEME. It is part of a global Toyota project involving 600 PHVs in Japan, the US, Canada and Australia.

Toyota's main objective is to investigate further the technology and performance of PHVs while EDF will evaluate different operational options for the charging infrastructure. The joint goal is to broaden consumers' understanding and acceptance, in preparation for broad commercialisation in the future.

EDF and its subsidiary Electricité de Strasbourg (ES) will participate in a technical and financial partnership and will set up several hundred charging points at users' homes, at the facilities of partners, in public parking lots and on public roads.

Some vehicles will be equipped with a innovative charging system developed by EDF, able to support communication between the plug and the vehicle, identification of the vehicle and invoicing of energy, while ensuring safe charging..

Strasbourg will lease five PHVs, support the set up of public charging points and provide a subsidy to the local car sharing company to lease three PHVs. The other vehicles will be leased to various public institutions and private companies.

The Prius PHV is Toyota's first hybrid to use lithium-ion batteries, which are costly but can store more energy than the nickel-metal hydride batteries used in most petrol-electric hybrid vehicles today.

The PHV can reach a top speed of 100km/h (62mph) in the electric motor mode and gets a combined EV and hybrid mileage of 57.0 km/litre (134 mpg). It emits just 59 grams of carbon dioxide per kilometre, as measured under European rules.

Despite carrying about 120 kg of extra batteries, the Prius PHV gets Japanese listed mileage of 30.6 km/litre in hybrid-only mode, slightly better than the regular Prius because the bigger battery can more efficiently capture lost energy during braking and coasting, Uchiyamada said.