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I WAS SHOCKED.

The young woman called the Mercury Tracer “cute.” A Mercury Tracer station wagon.

“Cute?”

“Cute,” she said.

She was wearing a newly minted high school ring. I figured the kid was just happy to be graduating. Maybe she was in some prolonged state of euphoria when everything and everyone looked cute, even her high school principal.

But several other young women gathered ’round the 1997 Mercury Tracer LS wagon, a pearlescent green thing with wraparound headlamps and oval body. They all declared it “cute” or “smooth” or some such thing. A little STATION WAGON! A MOM-POP MOBILE!

I drove home perplexed. I parked the Tracer in the driveway and spent some time staring at it. Was I getting old, or was Ford Motor Co. getting hip? Easy answer. Ford was getting hip. I just needed these kids to bring it to my attention.

Background: Is it possible that Ford has created the first economy station wagon that appeals to teenagers, something that could become a cultmobile for the truly young? I’m not willing to say “yes” to that — not yet, anyway. But Ford definitely has done something different with its Tracer — and it’s done a heck of a lot more than change the looks.

The new Tracer, also sold as the Ford Escort, actually feels tighter than its square-bodied, early-1980s predecessor. The feel is more than subjective. The body of the new Tracer/Escort is one piece — a single shell — to which everything else is attached. That means better-fitting doors, windows and, in the case of the wagons, rear lift gates.

Better fits mean fewer rattles.

To further reduce noise from wind and road, the new Tracer/Escort also has more standard sound-deadening materials, including larger weather strips for side doors.

Inside, the 1997 Tracer/Escort has more room for heads, legs, hips and butts than in the earlier cars. The instrument panel, a work of oval grace, is easier to see, touch and use. Overall visibility, helped by a wider windshield, is improved.

The new Tracer/Escort also comes with a new engine — a 2-liter, overhead-cam, inline four-cylinder job rated 110 horsepower at 5,000 rpm, with torque rated 125 pound-feet at 3,750 rpm. That’s 25 more horsepower than the previous Tracer/Escort four-banger.

A five-speed manual transmission is standard, which is odd, because most Tracer/Escort buyers in the United States buy automatics. A four-speed automatic is optional for $815 more.

Standard brakes include power-assisted front discs/rear drums. Anti-lock brakes by Kelsey-Hayes are optional for $570 more.

All Tracer/Escorts are front-wheel-drive, five-passenger vehicles available either as sedans or wagons. Sedan cargo space is 12.8 cubic feet, compared with 30.6 cubic feet in the wagon. Yes, dual front air bags are standard.

Complaints: Why make a popular item “optional” when most people buy it as “standard?” Ford needs to look at its U.S. sales numbers and make Tracer/Escort automatic t ransmissions standard, which is the way most of its buyers want it in this country.

Also, for all of the tightness in the new car, the lower plastic bumper molding on the right side of the test wagon warped a little after constant exposure to 97-degree heat.

Praise: Excellent redesign of a popular economy car. Exceptionally competitive in its category. The Tracer/Escort should be on the shopping list of everyone looking for a small sedan or wagon. Kudos!

Head-turning quotient: “Cute,” of course.

Ride, acceleration and handling: Triple aces. Will match or beat the best competitors in all categories. Braking was excellent. The tested Tracer LS wagon was equipped with the optional anti-lock brake system.

Mileage: Very good. About 28 miles per gallon (12.7-gallon tank, estimated 343-mile range on usable volume of regular unleaded), combined city-highway, running with two occupants and light cargo.

Sound system: Four-speaker AM/FM stereo radio and cassette installedb Ford. Very decent econosound.

Price: Surprise! Ford has lowered the base prices on its 1997 Tracer/Escorts. Base price on the tested Tracer LS wagon is $12,220, about $65 less than the base price on the 1996 model, according to the California-based Automobile Invoice service.

Dealer invoice price on the test wagon is $11,412. Price as tested is $16,410, including $3,775 in options and a $415 destination charge.

Purse-strings note: Compare with Toyota Corolla and Subaru Impreza wagons.