Toyota dealers nationwide are complaining about product shortages, especially with the popular Prius model.

“We had three- to six-month waiting lists for the Prius in March,” says Chris Abrahms, general sales manager at Toyota of Hollywood (CA), the country's largest-volume Toyota hybrid dealership. The wait is now down to about two months.

His dealership is the place where Hollywood celebrities from Julia Roberts to Tom Hanks shop for “green” cars.

The dealership is part of the L.A. Car Guy Family of Dealers group, which sells Toyota, Lexus, and Scion brands. The group also sells Audi, Volkswagen, Lincoln-Mercury, Mitsubishi, Hyundai and Porsche brands.

Toyota technology and marketing leaders admit they're working through challenging times as hybrid demand, especially for Prius, outstrips current production capabilities.

“Dealer inventory is in the single digits, and with the passage of the tax credits in the Federal Highway Bill and the Energy Policy Act of 2005, demand for Prius has grown even stronger,” says Celeste Migliore, national manager, advanced technology vehicles, Toyota Motor Sales USA.

Explaining Prius sales declines in March, Toyota says the chief culprit is that the HEVs are produced in only two plants in Toyota City, Japan; and the advanced hybrid technology is more labor-intensive than regular mass-produced vehicles.

“Combined annual capacity is 180,000 units a year for worldwide consumption, with about 100,000 units destined for the U.S. market, Migliore says of production capability.

Toyota plans to bring relief to dealers.

Last summer, Toyota made a significant investment for additional Prius production, Migliore says. She calls it “an unprecedented decision” because it was in the middle of a product life cycle.

Toyota plans to start shipping more products, especially the Prius, to the U.S. market this fall.

Toyota also in late fall begins production of the new Camry hybrid at a plant in Georgetown, KY.