Getting Greener The most fuel-efficient cars of 2011

While 2010 was a year for reinventing the auto industry, carmakers continued to reinvent the automobile. Electric cars, such as the Nissan Leaf and Chevrolet Volt, have created a new, uber-efficient caste in the green hierarchy. More EVs are coming later this year -- the Mitsubishi i and electric versions of the Smart Fortwo and Ford Focus.

Sales will be limited to certain areas, and at prices of $30,000-plus, the new technology will be limited to early adopters with deep pockets -- although a $7,500 tax credit from Uncle Sam will help ease the sting.

Government regulations will soon require all vehicles to use energy more sparingly: By 2016, automakers' fleets must average 35.5 miles per gallon. Despite the considerable hype for EVs, manufacturers are taking a multi-pronged approach to fuel efficiency -- hybrids, plug-in electrics, diesels and more-efficient internal-combustion engines.

For the traditional gasoline engine, downsizing is the trend. Turbocharging and direct injection help increase efficiency without compromising power. J.D. Power forecasts that a fourth of light vehicles will have turbocharged engines by 2015, and a third will have direct injection. Transmissions with more gears and CVT transmissions boost fuel economy, too.

Hyundai's new Sonata exemplifies these trends perfectly. The redesigned 2011 model forgoes a six-cylinder version altogether -- unheard of in the midsize market. With its 2.4-liter, four-cylinder engine, the Sonata achieved best-in-class efficiency of 35 mpg on the highway while beating the power of its four-cylinder midsize competition. Rodney English of Chevy Chase, Md., gets 37 mpg on the highway in his leased Sonata with no trade-off in power or roominess. For $219 a month, he says, "the driving experience for the price is very good." The Sonata is also available as a hybrid and in a powerful, 2.0-liter, direct-injected, turbocharged version.

The 2011 lineup brings several other new hybrids: the Kia Optima, Lexus CT 200h, Lincoln MKZand Volkswagen Touareg. Federal tax credits for hybrids and diesels expired at the end of 2010, and as long as gas prices stay below $4, savings at the pump are unlikely to pay back a hybrid's price premium.

In Kiplinger's annual buying guide, we choose the most fuel-efficient vehicles based on annual fuel costs, using gasoline prices of $3.10 for regular, $3.25 for premium and $3.35 for diesel and assuming 15,000 miles of driving each year.

Green is still a red-hot buzzword in the auto industry, with carmakers competing to showcase their commitment to fuel savings. Not every winner is a paragon of green technology, but each vehicle we spotlight is the least thirsty in its class based on annual fuel cost.

The annual fuel cost assumes 15,000 miles of combined city and highway driving each year and fuel prices of $3.10 a gallon for regular, $3.25 for premium and $3.35 for diesel. Models must make our top 25 to be eligible, and no model can win the award if another trim level of that model has won in a previous category. Let's go for a spin.

Top Five 2011 Best New Car Values: Most Fuel-Efficient

Most Fuel-Efficient: Under $20,000

Honda Insight
Sticker price: $18,950 (base) 
Invoice price: $17,934
Fair Purchase Price: NA
Five-year service cost: NA
One-year insurance cost: NA
Resale value after 3 years: NA; 5 years: NA
MPG city: 40; highway: 43

The namesake of the original hybrid gets a value trim for 2011, dropping its starting price by $1,700. In addition to being ultra-green, with a combined fuel economy of 41 miles per gallon, the compact hatch is ultra-safe -- it has standard stability and traction control and six airbags.

Most Fuel-Efficient: $20,000-$25,000

Toyota Prius
Sticker price: $23,810 (Prius II) 
Invoice price: $22,427
Fair Purchase Price: $23,572
Five-year service cost: $3,454
One-year insurance cost: $1,133
Resale value after 3 years: NA; 5 years: NA
MPG city: 51; highway: 48

Our perennial Most Fuel-Efficient winner is the category’s Best in Class winner as well. Combined fuel economy is 50 miles per gallon, making the Prius number one on the EPA’s list of Top Ten Fuel Sippers. Annual fuel cost is just $937.

Most Fuel-Efficient: $25,000-$30,000

Lexus CT 200h
Sticker price: $29,995 
Invoice price: NA
Fair Purchase Price: NA
Five-year service cost: NA
One-year insurance cost: NA
Resale value after 3 years: NA; 5 years: NA
MPG city: 43; highway: 40

The littlest hybrid from Lexus enters the premium compact market with more than superb fuel economy on its resume. Though it claims 43 mpg in the city, more impressive is its roster of safety equipment: eight airbags, including knee airbags for front passengers, front seats designed to avoid whiplash, a brake override system and an optional collision-warning system.

Most Fuel-Efficient: $30,000-$45,000

Lincoln MKZ Hybrid 
Sticker price: $35,180
Invoice price: $32,472
Fair Purchase Price: $34,476
Five-year service cost: $3,249
One-year insurance cost: $1,408
Resale value after 3 years: 45%; 5 years: 27%
MPG city: 41; highway: 36

The all-new hybrid variant of Lincoln’s MKZ wins Most Fuel-Efficient, beating closest competitor Lexus HS 250h by 6 city mpg. One reason: The MKZ Hybrid can go up to 47 miles per hour in pure electric mode. It also wins Best New Car, has the lowest service costs in its segment and carries the same price as the gas-engine model.

Most Fuel-Efficient: Over $45,000

Mercedes-Benz E350 BlueTEC
Sticker price: $51,775 
Invoice price: $48,212
Fair Purchase Price: $50,740
Five-year service cost: NA
One-year insurance cost: NA
Resale value after 3 years: 53%; 5 years: 32%
MPG city: 22; highway: 33

Terrific mileage for the diesel version of this luxury icon gives it an annual fuel cost of just $1,941 -- 22% cheaper than the gas-engine model. The E-class sedan won Best New Car last year, and the addition of a turbocharged diesel engine helped it clinch Best in Class for 2011.

Click here for the full list of 2011’s Best In Class Models

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