Pokemon Go is now introducing the second generation of Pokemon to Pokemon GO! Pokemon originally from the Johto region, such as Pichu and Togepi, along with select others, will be available by hatching eggs, and it is implied that more Gen 2 Pokemon will be released at a later date.
Additionally, through December 29th, Pokemon Go trainers will be able to encounter special-edition Pikachu dressed in a “festive hat” for the holiday season. These Pikachu will have increased spawn rates so they should be relatively easy to find.
UPDATE: Now that many people have been playing the game with the new update, we can confirm that Igglybuff and Cleffa can be found inside 2km eggs, Pichu and Togepi inside 5km eggs, and Elekid, Magby, and Smoochum inside 10km eggs. Togepi can also evolve into Togetic. The special-edition Pikachu also keeps his hat when you evolve it, making a Christmas Raichu.