When you go to Vancouver (or if you live there of course) you see hundreds Toyota Prius taxi cabs. The little hybrid is a favourite with passengers and cabbies.

In stop-and-go city traffic nothing but all-electric vehicles give better fuel economy or produce fewer harmful emissions than a hybrid.

Vancouverites tend to be slightly green (pro-environment, not seasick) so they like riding in a hybrid. The cabbies like the fuel economy and the low operating costs.

A hybrid combines as small a gas engine as possible with a braking system that generates electricity for an electric motor rather than just heat. The re-gen braking also means that brake pads hardly ever wear out.

Brake jobs can be a couple of hundred thousand kilometres apart – that keeps money in a cabbie's pocket.

So Vancouver gets it, but what about Toronto? You never see a Prius taxi in Hogtown.

The reason, apparently, is that the current Prius, the Vancouver Prius, doesn't have enough trunk room to satisfy the omnipotent taxi licence regulators in the Centre of the Universe.

That is about to change because here comes the Prius v; it's a roomy, new, station wagon version of the car that started the hybrid movement.

After a decade, Toyota is finally hitting the sweet spot in the Canadian market with the Prius v (lower case – v for versatile). It's a five-passenger, four-door hatchback with a little 1.8-liter four-cylinder engine and two electric motors.

This is the perfect size and configuration for both hatchback-loving Canadian families and Toronto taxi cabs.

Car manufacturers seem to be of two minds when it comes to having their fine automobiles going around with a taxi light on top. All over Europe there are countless Mercedes-Benz E-Class sedans lined up in taxi queues in front of airports, train stations and hotels.

If an E-Class is supposed to be a classy car, then why is it a common taxi? One senior executive I know of at a rival German car company only refers to Mercedes as "the taxi company."

Mercedes, on the other hand, isn't reluctant at all to have the sales and the evidence that their cars are tough enough to do a million kilometres (with a roof light).

Toyota has been selling hybrids in Canada for 11 years. Toyota has done a lot of good for itself by being able to project an environmentally-friendly image as the leader in worldwide hybrid sales.

But in Canada hybrid sales have been miniscule. Toyota has sold a grand total of 23,000 Prius' since the year 2000, many with $2,500 discounts.

The main difference between the Prius v and the original Prius is that it's bigger and a little heavier. So if the licensing bureau wants luggage room in Toronto taxis the Pruis v might be the answer.

Toyota claims it has more cargo space than 80% of the small crossover/station wagons that are so popular today. When the back seats fold down it has just about the same cargo space as a larger Chevy Equinox or Ford Escape.

Power? Not so much. The engine sounds like it's going to throw a piston if you try to accelerate going up steep hills. Some cabbies I've ridden with seem to think they're in the Indy 500 so they won't like that.

But the great majority will like the 4.6 l/100km combined fuel economy that Toyota says it will get once all the government tests are done.

If the Prius v catches on as a cab in Toronto's largest city I think it just might lead to a breakthrough in sales generally. I don't think Toyota is worried at all that the taxi cab image might hurt the cachet of their most technically advanced car.

Besides it couldn't hurt. Selling 23,000 of something so good in 11 years isn't a reason to stop experimenting with a new approach.