March 28 (Bloomberg) -- Toyota Motor Corp., Japan's largest automaker, plans to increase domestic production of its Prius gas-electric hybrid vehicle by 60 percent by next year, Nikkei English News said, without citing anyone.

Toyota plans to increase capacity at two domestic plants to produce 450,000 Prius cars a year by 2009, Nikkei said. It made about 280,000 of the vehicles globally last year, the newswire said.

The automaker seeks to manufacture more than 500,000 hybrids worldwide next year as higher oil prices and environmental concerns boost demand for fuel-efficient cars, Nikkei said.

Separately, Honda Motor Co., which produces a hybrid Civic sedan, plans to introduce a low-priced small hybrid model in early 2009, Nikkei said.

To contact the reporter on this story: Nancy Moran in New York at nmoran@bloomberg.net

Last Updated: March 27, 2008 14:32 EDT