Toyota has announced new details about its upcoming Yaris Hybrid supermini, and Honda won’t be happy. The small Toyota will undercut Honda’s Jazz Hybrid on price, while also delivering a far superior result on official emissions and economy tests.

While the Jazz Hybrid range runs from £15,995 through to £19,305, depending on specification, Toyota has announced that the petrol-electric Yaris range will start at under £15,000 — making it the cheapest hybrid on sale in the UK.

What’s more, Honda’s smallest hybrid scores a lacklustre 104g/km under combined cycle CO2 tests — just missing out on a basket of benefits including zero road tax and exemption from the London Congestion Charge. The new hybrid Yaris will, by contrast, breeze past the crucial 100g/km barrier with a remarkable score of 79g/km. It’s a similar story with official economy, where the Honda’s 62.8mpg rating is comprehensively eclipsed by the Toyota’s 80.7mpg.

Today’s news will be particularly galling for Honda given that its hybrid technology is much simpler than Toyota’s.

Honda has often stated that its goal is to offer the benefits of hybridisation at an affordable price point. Toyota’s hybrid system is much more complex and therefore more expensive to build, but is more effective at cutting fuel consumption.

Assuming Toyota is not selling its cheapest hybrid at a loss, it will have achieved economies of scale by fitting essentially the same hybrid powertrain to multiple models. The Toyota Prius, for example, has donated its engine, motor and batteries to the cheaper Auris Hybrid and the more lavish Lexus CT200h.

Similarly the Yaris Hybrid will presumably share its running gear from the upcoming US-market Prius C and Japanese-market Prius Aqua. If that’s the case, the European Yaris Hybrid will combine a 72bhp 1.5-litre petrol engine with a 54kW (60bhp) electric motor, offering a pooled peak of 99bhp. The nickel-metal hydride battery that feeds the motor squeezes under the rear seat, alongside a smaller fuel tank than you’ll find in other Yaris models.

No doubt planners at Honda will be wrestling with their spreadsheets to see if they can afford to trim the Jazz Hybrid’s price. Meanwhile Toyota customers can order a Yaris Hybrid today, with the first deliveries due early in July.