Hybrid SUVs are hardly fuel-sippers

Does anyone crave a huge SUV hybrid that costs more than $50,000? I'm not so sure. I recently spent a week in the GMC Yukon Hybrid (sticker price for the two-wheel-drive version: $50,945), and although it's comfortable, roomy and carlike in its handling, the fuel economy I got was less than spectacular. Plus, it costs nearly $10,000 more than the gas-only model.

The big selling point of the Yukon Hybrid is that the two-wheel-drive version gets 50 percent better fuel economy than the conventional model in city driving. Of course, the 5.3-liter gas-engine Yukon gets only 14 miles per gallon in the city, but GM deserves credit for some impressive engineering.

The electric motor takes over at idle and at speeds up to 30 mpg — so fuel economy in stop-and-go traffic gets a boost. At higher speeds, when the gas engine kicks in, the transmission switches to fixed gears. The gasoline engine is a bruising 6-liter V8, but it can operate on just four cylinders when you're cruising at a constant speed on the highway.

During the week I drove the Hybrid, I took a crew of four adults and one 8-year-old to the cold, snowy woods of northern Michigan. Reviews from the passengers were positive. The seats are comfortable, even in the third row, and second-row seats tumble forward for easy access. The ride is smooth, and the DVD player (a $1,295 option) was a hit.

From the driver's viewpoint, acceleration is impressive, and handling, even in snow, is sure-footed. It helped that my tester was a four-wheel-drive model, which is rated at 20 mpg in both city and highway driving. At the end of the 440-mile journey, the trip computer registered 17 mpg.

But say you get the advertised 20 mpg. If you drive 15,000 miles and gas costs $3 a gallon, you'll save nearly $670 a year at the pump over the gas-engine model. You're also kinder to the environment: Carbon-dioxide emissions, linked to global warming, are reduced by nearly a fourth.

Still, there's that pesky $10,000 premium over the gas-engine, mid-trim-level Yukon SLT, which works out to a 15-year payback. Many hybrid owners don't mind paying a premium because they're more interested in the technology and the environmental benefits than in earning back every last penny in savings at the gas pump.

If you need eight seats and the ability to tow up to 6,200 pounds, take a hard look at the Yukon (or Tahoe) hybrid. But don't expect accolades from Al Gore. Clearly, the Toyota Prius deserves its green reputation, but the cost-benefit equation is fuzzier with a massive hybrid SUV.

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Mark Solheim is a senior editor at Kiplinger's Personal Finance magazine. Send questions and comments to moneypower@kiplinger.com.