Road Test: Lexus IS 300h F-Sport 4dr CVT Auto

Set against the almost tediously uniform competence of the German Three's compact £30,000 saloons, the all-new Lexus IS300h is as fascinatingly patchy as an Eighties Alfa Romeo. Well, kinda: the areas in which it's great (quality, refinement, cost of ownership) and the areas in which it's frustratingly deficient (engine charisma) are an exact reversal of what owners of old Alfas ‘enjoyed'. Even so, the Lexus is a car that demands its buyers are sure exactly what they want from a car, and what drawbacks they are prepared to suffer in pursuit of those aims.

The new IS really is all-new on top and mostly new underneath. But Lexus's ambition does have limits. They know that in Europe more than two-thirds of the 3-Series/A4/C-Class stranglehold is taken up by two-litre diesels. And they're also charmingly frank that they don't have the diesel expertise to match the opposition. But since low CO2 ratings are the main reason all those diesels are sold, they decided to stick to their knitting: a petrol hybrid. (They offer an IS250 with a V6 petrol too, but no one will buy it, just as no one much in Europe buys petrol six-pot BMWs and Audis and C-Classes anymore. Plus it's an old, thirsty engine, and it's for America really.)

Actually, the new IS nearly didn't happen. Back in 2008 when no one knew how far the world car market would collapse, many people in Toyota were rooting for a cut-price solution to Lexus development. In the US, they have a car called the ES, a rebodied Toyota Camry. It's as big as the GS, but has FWD and is no fun, yet in the US (Lexus's prime market), it outsells the GS four to one. The case for killing the GS looked clear. But Toyota got a petrol-head new boss, and a new rear-drive GS got the nod. I was driving that GS a few weeks ago, and it's an engaging car.

The GS's suspension, powertrain, hybrid system architecture, electronics and much more have been transferred to the IS. More than one senior Lexus person has told me there would have been no RWD IS without that GS. I guess we'd have had a rebodied Avensis instead, so help us.

The IS's chief engineer Naoki Kobayashi is a bit of an enthusiast himself. He had been assigned to do a new Supra - go Google the FT-HS concept - but, in between the resources being poured into the Toyota GT86 and the development-hell Lexus LFA, that car was canned and he got to do this IS instead. (The story later took another twist, since Toyota and BMW are now working together on a sports car in roughly the Supra space.)

The new IS has some of the body structure of the old one, but it has several new braces underneath. Kobayashi still didn't think that was enough and wanted to use adhesive-bonded body seams. He knew the management would say no, because that needs expensive factory investment. So, under the radar he built a seam-glued prototype and then got the boss to drive it. Sure enough, the investment was approved.

As I say, Lexus is good at hybrid. This one uses a mostly new 2.5-litre engine, with lots of friction-reducing measures. It runs direct injection, and is tuned to work best at medium revs, with the electric motor filling in the gaps. On-paper acceleration is OK, with 0-62mph in 8.3 seconds, but top speed is limited to 125mph because it uses a simpler geartrain for the electric motor than in the GS hybrid, to cut weight and friction. For most of us, 125 is just fine.

The IS300h slips beneath the magic 100g/km CO2 line, at least the narrow-tyred base version does, and so company car tax is super-cheap. We were driving the F-Sport on broad rear treads, but even so it manages a scant 109g/km. All versions do 0-62mph in 8.3secs. Worth noting is that Lexus's hybrid has automatic transmission integral to the system, whereas for most rivals you have to pay extra, both in price and CO2/fuel.

Wrapping all this is a body that's similar in outline to the last one, but has stronger curves and haunches. It's also punctuated by a grille like a big digital figure-eight, and sharp L-blade LEDs separated from the main lamp clusters. The tail-lamps emerge as if from a slash in the bodywork. The body is also 70mm longer in its wheelbase, to the good mostly of rear-seat space, though if you were sat there for long you'd still call it a bit compact for a four-door.

From the front, the interior's a success. It's an unusual and rather fetching three-dimensional dash shape, clad in either leather or a facsimile thereof that had me fooled. Since it's a Lexus, the quality of materials is pretty fine and the list of equipment goes on and on. The F-Sport version has similar reconfigurable clocks to the ones in the LFA, and excellent sports seats too. Many versions have a plethora of radar eyes and blind-spot systems, and satnav capable of online searches and even Google Street View (which shows you a screen giving you the option of street view of your current position. Why not just look out of the window instead of staring at the screen?)

This stiff body and sophisticated suspension do reap rewards, not just in handling but in ride and refinement, too. To all intents and purposes, the IS steers as precisely and as sharply as any of the opposition. Especially in the F-Sport version, which has a slightly stiffened chassis, the handling's slop-free, and the whole assembly has a happy hunger for bends and roundabouts, with a reassuring, if slightly one-dimensional, mild understeer when it's all out. The ride's good too, without much banging or thumping, even though it is, on the F-Sport, slightly on the taut side of the average.

So far then, you're thinking Lexus has hit a bit of a bullseye in making an attractive, enjoyable and thrifty sports saloon. But that's because we haven't got to the hybrid system, and the way it drives. If you like curving roads with lots of speed changes, this is a bit of a stinker. Not because it won't change speed, but for the way it does it.

The 2.5-litre petrol engine and hybrid motor together make 220bhp at peak. Good on paper; more power than the rival 2.0 diesels anyway. But the Lexus/Toyota hybrid system depends for its efficiency on the engine revving up and down in a way that's almost entirely unrelated to road speed. Deprived of auditory hints on the way into a corner, you have spookily little idea how fast you're going. Then as you accelerate away again, its answer to the accelerator sounds squidgy and unsatisfying. Not sporty, then.

But Kobayashi has a partial - and rather sneaky - answer. A little switch activates a loudspeaker that emits a synthesised ‘engine' noise. Its pitch is proportional to road speed. It even has six frequency registers controlled by steering-wheel paddles. To stress: it has nothing whatsoever to do with the true rpm, it's entirely synthetic. But it does offer your ears a clue to your rate of acceleration or braking. You can play games: while braking do a ‘downshift' and hear the synthesised sound rise in pitch, while the real rpm on the tacho keeps falling. It's gimmicky, but sometimes it helps you engage more with the IS. Pity they didn't sample the LFA's V10 howl - or even that of one of those Eighties Alfa twin-cams on twin Dell'Ortos.

Anyway, thrash a hybrid like that, and it gets thirsty. These CVT petrol hybrids shine in gentle driving, especially in cities. In that situation, they're probably more economical and definitely far quieter than diesels, especially for the surprisingly frequent times when you dribble along under electric power alone. The IS is civilised on the motorway too. I wish Lexus had binned the idea of it being sporty and softened off the suspension, playing to the powertrain's strengths.