Toyota has the magic SUV formula figured out, and each segment has impressive options. Combining versatility, reliability, and affordability, the best Toyota SUVs are the RAV4 and the Highlander. Both options offer a top-notch driving experience without breaking the bank. With the brand’s combination of practicality, comfort, and a budget-friendly price tag, the 2023 Toyota RAV4 and 2023 Highlander stand tall as the best Toyota SUVs under $40,000.

What’s the best compact Toyota SUV under $40,000?

For those who want a compact option, the best Toyota SUV under $40,000 is the 2023 RAV4. The 2023 Toyota RAV4 LE starts at $28,275, while the fully-loaded RAV4 Limited is $36,580. Even if you go with the base model RAV4, it has plenty of technology and safety features.

Toyota equipped the 2023 RAV4 with a 2.5L four-cylinder engine and front or all-wheel drive. The engine gets 203 horsepower and 184 pound-feet of torque, which is plenty to propel the compact SUV around town. With front-wheel drive, the LE trim gets 27 mpg in the city and 35 mpg on the highway, but that varies.

Toyota Safety Sense 2.5 adds a Pre-Collision System with Pedestrian Detection, Full-Speed Range Dynamic Radar Cruise Control, and Lane Departure Alert. Automatic High Beams and Road Sign Assist are also included in the package. All of these helped the 2023 RAV4 earn a five-star overall safety rating from the NHTSA.

What’s the best hybrid Toyota SUV under $40,000?

For the best Toyota SUV with a hybrid engine, the 2023 RAV4 Hybrid is an excellent option. There are a variety of RAV4 trim levels with hybrid powertrains, such as the LE, XLE, Woodland Edition, XLE Premium, SE, and Limited trim levels. The base Hybrid LE trim starts at $31,225 up to the Hybrid Limited for $39,530.

The Hybrid RAV4 SUVs use a 2.5L four-cylinder engine paired with an electric motor for 176 horsepower. That helps increase the fuel economy to 41 mpg in the city and 38 mpg on the highway.

The best Toyota SUV with a hybrid engine also gets Toyota Safety Sense 2.5 and high marks from safety groups. This was enough to earn this year’s IIHS Top Safety Pick award. All hybrid options are under $40,000, so you get a solid blend of reliability and affordability in one compact package.

What’s the best midsize Toyota SUV under $40,000?

If you can swing the higher price tag, the 2023 Highlander is one of the best Toyota SUVs under $40,000. The base 2023 Highlander L starts at $36,620, but the LE trim slides in just under budget at $39,020. This best-selling SUV has room for eight passengers and plenty of space for everyone.

These Highlander SUVs have a 2.4L four-cylinder turbo engine with 265 horsepower and 310 pound-feet of torque. That works out to about 22 mpg in the city and 29 mpg on the highway with front-wheel drive. With 84.3 cubic feet of space in the back with the rows folded, the Highlander SUV is a fan favorite for a reason. The 2023 Toyota Highlander earned a Top Safety Pick Plus award thanks to all the safety features. It also earned a five-star overall safety rating from the NHTSA.

For the best Toyota SUV, these three options have you covered. The RAV4 and the Highlander have a modern design that catches the eye and optimizes fuel efficiency. Whether navigating through city streets or venturing off-road, the RAV4 and Highlander’s dynamic performance and responsive handling make both a joy to drive.