TOKYO - Honda Motor Co on Thursday launched the sporty CR-Z model, its second in a line of low-cost hybrid cars aimed at meeting stricter environmental regulations and expanding sales in the tough global car market.

Honda, Japan's No.2 automaker, has taken a different strategy for gasoline-electric cars from leader Toyota Motor Corp, choosing a simple, one-motor structure to keep costs down, while its rival uses two motors to achieve greater mileage.

The two-door CR-Z follows the Insight launched a year ago, with sales starting in Japan on Friday at 2.27 million yen ($25,340). The model will hit showrooms in North America and Europe from summer or later.

Honda said it has received 4,500 pre-sale orders in Japan, or 4-½ times its monthly sales target. It aims to sell 40,000-50,000 units annually worldwide.

Facing stiff competition from Toyota's newest Prius, Honda's Insight model has fallen short of an original global sales target of 200,000 in the first year of sales. Cumulative sales at the end of January stood at 136,000 units, although the model was rolled out outside Japan in stages from March.

While analysts say Toyota slashed the sticker price on the Prius at the expense of fatter profits, Honda said margins on its CR-Z were better than on the Insight.

When we launched the Insight, we said profitability was better than the Fit (subcompact), Executive Vice President Koichi Kondo said, referring to Honda's top-selling car in Japan.

The CR-Z's is better than the Insight's, he said at the car's launch in the posh Roppongi Hills district of Tokyo.

QUALITY SUFFERED DURING RAPID EXPANSION

Turning to Toyota's safety troubles, Honda Chief Executive Takanobu Ito said his company had also faced a quality crisis during a rapid expansion in the late 1990s, when recalls spiked to record levels and put Honda in the spotlight.

If we look back at our own history, in the late 1990s when the global market was expanding fast, we experienced a rise in the number of customer complaints, he told the news conference.

At the time, Ito said, then-president Hiroyuki Yoshino laid out a stern and forceful companywide directive to go back to the basics -- much like Toyota President Akio Toyoda has promised in past weeks -- and that those efforts had borne fruit.

Of course, we are doing business so we have to seek expansion ... , but we lost sight of what customers expected of us, Ito said.

Ito also said reports of unintended acceleration -- at the center of Toyota's multi-million-vehicle recall -- existed across all brands, and that getting to the bottom of the cause of each case was very difficult.

He said, however, that there had been no noticeable change in the proportional number of unintended acceleration cases before and after Honda switched to an electronic throttle control system from a mechanical one.

Many lawmakers and some safety experts have expressed fear that Toyota's electronic throttle system can be subject to electromagnetic interference. Toyota has repeatedly said numerous tests have determined that that was not the problem.

Electromagnetic testing is required by law, and we routinely carry out tests far beyond what's mandated, Ito said.

(Editing by Chris Gallagher)

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