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"One question lingers after driving the 2006 Lexus RX400h: How did it come to this, that Toyota is now selling a hybrid gas-electric vehicle with no tangible fuel economy benefits?"

Hubby and I test-drove the Lexus RX400 and RX400h. Both are wooonderful cars, but we laughed our butts off at people willing to pay $10K more for the same car with about 30% better fuel economy but with less power.

5000 gallons of gas (roughly $10K) will put 130,000 miles on the road for the RX400.

There are no sound economics in hybrid cars.

Honda and Toyota went ahead with hybrids when Detroit decided to hold off because of the difference between the home markets in Japan and the US. Gas is much more expensive in Japan plus there's a sizeable market for much smaller vehicles among Japanese consumers. So it made sense for Honda and Toyota to pursue hybrid development. Though, Detroit probably should have pushed on it more because:
1) Such development would challenge their engineering staffs;
2) Much of the work into hybrids will probably be useful in other fuel efficient designs down the road;
3) Other markets are similar to Japan with higher gas costs and bigger markets for smaller cars;
4) Detroit should never have assumed that low gas prices would continue indefinitely;
5) For an industry that once flourished on selling cars on intangibles, ignoring the potential of greenies wanting to "save" the environment was a bit silly.

If you're buying an SUV for, among other things, its towing capacity, that extra power is vital. From that, due to the laws of physics, there inevitably comes lower gas mileage. My '04 Navigator gets about 15 mpg on the road when it's not towing my 7,500 lb. boat and trailer rig. When I'm towing the rig, mileage drops to about 7.5 mpg. There's just no way a hybrid will work for me.

The $9,500 premium a purchasers pays for a Prius is just too much to be economically recoverable at a $580/yr. gas savings. Not accounting for the time value of money (more about that later), it would take 16.4 years to recover that $9,500 through fuel savings. However, if that money was invested at an 8% annual return, it would double in about 9 years, meaning the gas savings will never enable the vehicle's purchaser to recover the $9,500. Even worse, the batteries need to be replaced about every four or five years at a cost of about $4,000, which is just about the price of a rebuilt engine. One of these things is nothing but a head up the behind feel good device for proving to one's neighbors how environmentally good one is.