There's finally a great alternative to the Toyota Camry hybrid: Mercury has rolled out a gasoline-electric version of its redesigned Milan midsize sedan for 2010, and it's quite a pleasant surprise.

With a starting price of just $27,855 (plus $725 freight), this beautifully styled car has ample room for five people, one of the best-laid-out interiors I've seen lately in a family sedan, and fuel economy that knocks the pants off the Camry.

The Milan hybrid is EPA rated at 41 mpg in the city and 36 on the highway, which easily beats the Camry hybrid's 33 city/34 highway ratings.

Milan even beats the new Honda Insight compact hybrid's city rating, which is 40 mpg, although the Insight does score a higher number for highway driving, 43 mpg. (Honda no longer offers an Accord hybrid, but when it last did - 2007 -- its mileage was paltry in comparison with the Milan -- 24 city/32 highway.)

Under the hood of the Milan hybrid is a combination of a 2.5-liter four-cylinder Atkinson cycle engine and an electric motor, while gasoline-only models offer a choice of a different four-cylinder or a 3.0-liter V-6.

Base prices of the gasoline-only Milan models range from $21,535-$28,155 (plus freight).

Even the four-cylinder Milan S outranks many compact and most midsize sedans on the market with its EPA ratings of 23 city/34 highway. That beats both the gasoline-powered Camry and Honda Accord models, EPA rated at 21 city/30 highway for the Accord and 21/31 for the Camry.

This year's redesign of the Milan is not considered a complete makeover because it still has the same basic architecture of the Milan that was originally introduced for 2006. But there were numerous exterior and interior changes, along with a lot of new technology.

The big satin-aluminum signature Mercury waterfall grille makes the car look more elegant, and there are more standard amenities even on the base model, giving the Milan the feel of a luxury car at a mass-market price.

Until this year, Ford's only hybrids have been the Ford Escape and Mercury Mariner compact crossover utility vehicles, which entered their second generation last year.

All of Ford's hybrids come with the new Atkinson cycle four-cylinder engine for better fuel economy. It's assisted by an electric motor, and power is transferred to the wheels by an electronically controlled continuously variable transmission.

The hybrid's gasoline engine is rated at 156 horsepower and 136 foot-pounds of torque. Ford developed the system on its own, but licensed some of the technology from Toyota because of similarities with Toyota's hybrids.

A continuously variable automatic transmission is used with the hybrid to seamlessly integrate gasoline and electric power.

This system allows the Milan to run at high speeds, up to 47 mph, in electric-only mode. The new Toyota Prius can go only as high as 25 mph before the gasoline engine kicks in. A smaller, lighter nickel-metal hydride battery has been developed for the hybrids, and can produce 20 percent more power over the previous generation of this battery.

Ford says the Milan hybrid has a range of up to 700 miles between refueling.

To get the best fuel economy, drivers can use the Milan's SmartGauge and EcoGuide system on the dash. It displays instant fuel economy, fuel economy history, odometer, engine-coolant temperature, what gear the transmission is in, and trip data.

Special features on the hybrid model include unique badges on both sides and the rear of the vehicle; 17-inch aluminum wheels; recycled seat fabric; and a standard 110-volt power outlet.

Four-cylinder gasoline-only models come with different 2.5-liter engine, rated at 175 horsepower and 172 foot-pounds of torque.

The gasoline models come in four trim levels - I4 S, I4, I4 Premier and V-6 All-wheel-drive Premier. A six-speed manual or six-speed automatic are the transmission choices.

The hybrid is offered only in one model, but it comes well-equipped, including leather seats, which accounts for part of the price differential from the base gasoline model. But I'm sure some consumers would prefer a lower-priced version without all of the premium amenities.

Standard on the hybrid model are dual-zone automatic climate control; tilt-and-telescopic steering column; eight-way power driver's seat with lumbar adjustment; auto-dimming rearview mirror; power door locks with remote keyless entry, along with a door-unlocking keypad on the pillar between the driver's side front and rear doors; power windows; heated power outside mirrors; Sirius satellite radio; the Ford/Microsoft Sync system that offers voice-activated control of iPods and Bluetooth connections; pleasant ambient interior lighting; LED taillights; and Ford's new cap-less fuel tank..

Among standard safety features are automatic headlights; four-wheel anti-lock disc brakes; fog lights; front seat-mounted side air bags; side-curtain air bags for both rows; the SOS crash-notification system, which is similar to General Motors' OnStar; electronic stability control with traction control; tire-pressure monitoring; and a perimeter anti-theft system.

Extras on our tester included the "Rapid Spec 300A" package ($3,735), which added a power moon roof, Sony 12-speaker sound system, blind-spot detection system, a rearview camera, and a rear spoiler.

Also included was a navigation system ($1,775) and white platinum exterior paint ($495).

Total sticker was $33,925, including freight, options and a package discount of $660.

There is plenty of power with the hybrid drive system. With the electric motor used as a booster during hard acceleration, the car has the feel of a V-6 rather than a four-cylinder, but with that great hybrid fuel economy.

All-wheel drive is available in the gasoline-only Milan with the optional 3.0-liter V-6 engine (rated at 240 horsepower and 228 foot-pounds of torque).

The trunk on the hybrid model has just 11.8 cubic feet of space, compared with 16.5 cubic feet for the gasoline models. It has a pass-through to the passenger compartment for larger cargo, accommodated by the 60/40 split-folding rear bench seat.

While the car seats five, the rear seat is more comfortable with two adults and a child in the middle, rather than three adults.

The bottom cushion of the front bucket seats was a bit short to support my thighs sufficiently, and my wife had the same complaint on her side. Otherwise they were mostly comfortable.

While the cup holders are well placed, the bottle holders in the front doors are small and not easy to access. But overall, the interior is very well laid-out, and the instruments are large and easy-to-read with cool blue lighting.

The blind-spot warning system has lights in both of the outside mirrors, which illuminate an orange dot when there is a vehicle in the adjacent lane on either side. This is a great optional safety feature, especially during rush-hour freeway driving.

The automotive columns of G. Chambers Williams III have appeared regularly in the Star-Telegram since 1994. Contact him at 210-250-3236;

2010 Mercury Milan

The package: Midsize, four-door, five-passenger, four-cylinder, V-6 or hybrid-powered, front- or all-wheel drive family sedan.

Highlights: Mercury's midsize sedan has been redesigned for 2010, and a hybrid version has been added to the mix.

Negatives: Trunk space is limited on the hybrid model because of the battery pack.

Engines: 2.5-liter inline four cylinder; 3.0-liter V-6; 2.5-liter four-cylinder and electric motor (hybrid).

Transmissions: Six-speed manual or six-speed automatic (gasoline models); continuously variable (hybrid).

Power/torque: 175 HP./172 foot-pounds (2.5-liter, gasoline); 240 HP./228 foot-pounds (3.0); 156 HP./136 foot-pounds (2.5, hybrid).

Length: 189 inches.

Curb weight: 3,308-3,699 pounds (gasoline models); 3,729 pounds (hybrid).

Brakes, front/rear: Disc/disc, antilock.

Trunk volume: 16.5 cubic feet (gasoline); 11.8 cubic feet (hybrid).

Side air bags: Front seat-mounted, roof-mounted side-curtain for both rows, standard.

Electronic stability control: Standard.

Fuel capacity/type: 17.5 gallons (front-wheel drive); 16.5 gallons (all-wheel drive); 17.0 gallons (hybrid), all unleaded regular.

EPA fuel economy: 22 mpg city/29-31 highway (2.5-liter, manual); 22-23/31-34 (2.5, automatic); 18/27 (3.0, front drive); 18/25 (3.0, AWD); 41/36 (hybrid).

Major competitors: Volkswagen Passat, Honda Accord, Toyota Camry, Nissan Altima, Kia Optima, Hyundai Sonata, Chrysler Sebring, Dodge Avenger, Mitsubishi Galant, Chevrolet Malibu, Mazda6, Ford Fusion, Suzuki Kizashi, Subaru Legacy.

Base price range: $21,535-$28,155 (gasoline); $27,855 (hybrid), plus $725 freight.

Price as tested: $33,925, including freight and options (hybrid).

On the Road rating: 9.3 (of a possible 10).

Prices shown are manufacturer's suggested retail; actual selling price may vary.