Review: 2010 Lexus RX 450h

Up Front

In my opinion, we can take either of two basic approaches to improving the fuel economy of North American vehicles. The first is that we all go out and buy a 2010 Toyota (TM) Prius, far and away the most fuel-stingy and environmentally friendly production vehicle on the market. The second is to improve the mileage of every type of vehicle. If consumers insist that they need, say, an SUV, a big luxury sedan, or a full-size pickup truck, respect their wishes, but make sure those vehicles become far more efficient than they have been in the past.

Approach No. 2—which, obviously, is more practical than Approach No. 1—leads us to consider the new Lexus RX 450h, the hybrid-powered version of Toyota's popular Lexus RX 350 midsize luxury SUV. The new RX 450h is better than the RX 400h, the model it replaced, with more space, more power, and better fuel efficiency. Most people can buy one instead of a conventional gasoline-powered RX 350 without giving up anything—whether it be money, convenience, or performance. Also, as of this writing, no recalls have been announced on the RX 450h, so the model hasn't shown any of the braking glitches that have plagued the 2010 Prius.

With front-wheel drive, the RX 450h gets 32 mpg in the city and 28 on the highway, for an average of 30; with all-wheel drive, the numbers fall to 30/28 and an average of 29. That's excellent for an SUV—9 mpg better, on average, than a comparable 2010 RX 350. But it's still way behind the Prius' average of 50 mpg.

The RX 450h starts at $43,560 with front-wheel drive and $45,150 with all-wheel drive, about $5,000 more than a comparable gasoline-powered RX 350. However, the average American buyer keeps a new vehicle for about six years, according to the Power Information Network (PIN). With premium gasoline at around $3.00 per gallon, and likely to rise at least a little in coming years, most owners will recover most or all of the price premium in fuel-cost savings (more details later). The hybrid's CO2 emissions are significantly lower than the conventional model's, so you'll be going easier on the environment, too.

The RX 450h has a more powerful engine than its conventional cousin, with a 3.5-liter V6 gasoline engine and two (three with all-wheel drive) electric motors that generate a combined 295 horsepower, 20 more than the RX 350's V6. The only transmission offered in the hybrid is a continuously variable automatic, vs. a six-speed automatic in the RX 350.

The RX 450h doesn't yet have government crash-test ratings. However, it is probably about as safe as the RX 350, which has five-star ratings in every category except rollovers, where it earned four stars. The RX 450h comes standard with a full range of airbags, as well as stability and traction control and braking assist.

Lexus expects to sell about 18,000 RX 450h's annually, though sales are off to a slow start this year. Only 1,906 were sold in the first two months of the year, down from 3,058 RX 400h's sold during the same period in 2009. Lexus sold about five times as many RX 350s as RX 450h's in the first two months of this year.

Behind the Wheel

The Lexus RX 350 I recently test-drove had a number of annoying creaks and rattles in its cabin, and I couldn't get the rear hatch cover to stop rattling; even though the RX 450h's interior is almost identical, it had none of these problems.

I don't know why the hybrid feels better-built than the RX 350. Perhaps it's because my RX 350 had more miles on it (around 13,000 miles vs. around 8,000 for the RX 450h). Or perhaps it's because the RX 450h is built in Japan and the RX 350 I test-drove was built in Ontario. However, I had the same reaction when I test-drove the 2007 RX 400h: It seemed more tightly built than a Lexus RX 330.

I found both the RX 450h and the RX 350 quicker than Lexus says they are. In accelerating from zero to 60, the company rates the RX 350 at 7.4 seconds with front-wheel drive and 7.5 seconds with AWD. The hybrid is rated at 7.8 seconds with FWD and 7.4 seconds with AWD (which is weird because all-wheel drive adds weight and should make the vehicle slower). Then again, both my test vehicles had AWD and the RX 350 did zero to 60 in 7.0 seconds; the RX 450h, 7.2 seconds.

The 450h has almost exactly the same clean, crisp, and attractive interior design as the RX 350. Head, leg, and shoulder space are exactly the same in both models—which is to say adequate throughout except that leg space is a bit cramped in back. Cargo space is a voluminous 40 cu. ft. with the rear seats up, and 80.3 cu. ft. with the rear seats folded down. Maximum towing capacity is 3,500 lb. in both models—in both cases only with AWD and an optional towing package ($238). The hybrid comes with all the usual fancy options, including a navigation/rear seat entertainment system ($5,005), heads-up display ($1,200), and heated and ventilated seats ($640).

Setting aside their engines, the differences between the two models are minor: The hybrid is more than 300 lb. heavier, but its superior horsepower keeps performance about the same. Ground clearance is a tiny bit less in the hybrid (6.9 in., vs. 7.3 in. in the RX 350). The hybrid even has the same annoying design glitches as the RX 350: It's like dumpster diving to get at the auxiliary power plug, which is at the bottom of the cavernous storage bin in the center console, under a removable tray. The rear seat is too hard to be comfortable.

One minor downside of the hybrid: You're supposed to run the RX 450h at least once a week to keep its battery charged, an annoyance if you're out of town a lot.

Buy It or Bag It?

There's nothing else quite like the RX 450h on the market. The closest alternative I can think of is a loaded-up Toyota Highlander hybrid, but that really isn't a luxury model. German companies are coming out with some nice hybrid SUVs, but they cost more and aren't as fuel-efficient. For instance, Daimler's (DAI) Mercedes-Benz ML450 hybrid carries a $60,000 average price tag, according to PIN, has to be leased rather than bought, and only averages 22 mpg. Audi's new Q5 hybrid won't be out until later this year, or early next. Diesel-powered German SUVs are great, but their emissions are higher than a hybrid's.

Will you ever really recover the Lexus 450h's $5,000 price premium? The typical car buyer—who drives around 15,000 miles annually and keeps a new vehicle six years—would probably lose at least $1,000 on the RX 450h at the current price of premium gasoline (recommended in both the RX 450h and RX 350). But who really believes gas prices will stay at current levels? If premium averages, say, $4.25 (compared with $3.00 now), the average buyer will save $900 to $1,000 annually—and easily recover the hybrid's extra cost. You can plug annual mileage and gas-price projections into a calculator on the Energy Dept. Web site to come up with your own numbers.

Obviously, Toyota's recent recalls raise doubts about its products. But, so far at least, the RX 450h remains unaffected. And if you're worried about having to replace the hybrid battery (a $4,995 expense), don't. The battery is designed to last the life of the vehicle; it and other key elements of the hybrid system are covered by warranty for eight years or 100,000 miles. Owners have found that the batteries last 180,000 miles or more, a Lexus spokesman says.

The RX 450h is no Prius. But it offers SUV buyers better gas mileage and performance at no real cost to themselves.

Click here to see more of the 2010 Lexus RX450h.

Before it's here, it's on the Bloomberg Terminal.