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Toyota CEO: Hybrid sales to pick up, here’s why

Sales of Toyota's flagship hybrid, the Prius, have faltered recently, but Toyota North America CEO James Lentz said Wednesday they are due for a rise.

Prius sales fell 10.9 percent last year as gas prices in the U.S. dropped dramatically amid oversupply in the crude market.

"We saw a decline; fuel prices are obviously a part of that, but in the case of us, we're 60 percent of the marketplace," Lentz told CNBC's "Squawk on the Street," but added that the Prius was at the end of its cycle at 5 years old, "so I think that had a lot to do with it."

He also said that gas prices are back on the rise, which will prompt more drivers to buy a hybrid.

"If you look at the price of gas, down in Texas, it was $1.39 [a gallon] just a couple months ago, it's almost up to $1.80. We all know that gas prices are going to fluctuate," he said.

On Wednesday, RBOB gasoline futures were down about 1 percent, but have gained nearly 20 percent in the last 3 months, according to FactSet.

Toyota also unveiled the Prius Prime, a new hybrid plug-in vehicle that will be available later this year.

"The Prime is our next generation of plug-in [cars]. This is a vehicle that will go 22 miles on all electric, have an overall 600-mile range vehicle, so it is the most advanced Prius we have ever built," Lentz said.

At 22 miles on electricity, the Prime pales in comparison to other similar vehicles, like the Chevrolet Volt, which can go 53 miles on electricity only. The Prime's 600-mile overall range, however, is well above the Volt's 420 miles.