By combining a gasoline engine and an electric motor and adopting a light aluminum body structure, the company has achieved the world's lowest fuel consumption for a mass-produced gasoline-powered vehicle.

The gasoline-powered vehicle is expected to run 35 kilometers per litre, it claimed.

Honda said the main power source in the hybrid-engine technology, called the Honda integrated motor assist system, is a light-weight, compact 1-litre lean burn VTEC gasoline engine, Kyodo News Agency reported.

The new lightweight aluminum body structure offers high rigidity and advanced safety performance in a package 40 per cent or more lighter than a steel body, while electric motor helps the engine during acceleration and ensures optimal use of energy, Honda said.

It said the two-seater Insight will be priced competitively with Toyota's `Prius,'introduced in 1997 as the world's first mass-produced hybrid car.

The Prius has a price tag of 2.15 million yen.