Over the past several years, 40 miles per gallon has become a sort of high water mark for compact cars, with a long list of special efficiency-focused models aiming to meet or exceed that number.

Yet for those vehicles, we're talking highway mileage. The 2013 Toyota Avalon Hybrid, on the other hand, can hit that magic number in the city. And it's a comfortable, quiet, luxurious sedan with room for five, a big trunk, and loads of premium convenience features.

Toyota still expects more Avalons to be powered by the strong 268-horsepower V-6 and six-speed automatic, although its EPA ratings of 21 mpg city, 31 highway aren't nearly impressive as the Avalon Hybrid's ratings of 40 mpg city, 39 highway (and 40 mpg Combined). And after driving the full range of 2013 Avalon models last week, we ended up seeing the Avalon Hybrid as the more compelling.

Not as quick as the V-6 Avalon, but quick

While Hybrid models take 8.2 seconds to get to 60 mph (versus 6.7 seconds for the V-6), we felt like that number was a bit on the conservative side. Click the Sport mode (EV, Eco, and normal are your other choices), and you get not only a slightly firmer, more reassuring steering feel but also a decidedly different feel when you tip into the accelerator—with the electric motor system delivering a wave of strong torque to supplement the 2.5-liter four-cylinder Atkinson-cycle gasoline engine.

You sure don't give up much in real-world performance or refinement. We found the Avalon Hybrid's powertrain to be quiet, smooth, and refined for the most part, with nearly no electric-motor whine, and the distant drone of the four-cylinder engine only heard at or near full throttle. With the climate control on, or the sound system on low, your passengers won't likely be able to tell the difference. And there are no jarring transitions between power sources; we even liked the brake-pedal feel of the Hybrid better than that of the V-6 car (because it's less spongy, and more precise). Yes, Toyota's really massaged the kinks out of this system in its various iterations and 15 years on the market.

All the better, the Hybrid feels just as sprightly and nimble as the gasoline version. We would never have used those terms with the previous version of the Avalon, but as we outline in our First Drive, over at The Car Connection, the Avalon V-6 now weighs less than 3,500 pounds and the Hybrid weighs only a hundred pounds more. And by the feel of it in the tightest corners, right near the limits of adhesion, the Hybrid almost feels better balanced—possibly because its 150-pound battery pack is in a place that helps make this big sedan's weight distribution more even.

A little trunk space is all you give up

With the Avalon Hybrid's well-packaged battery pack, you don't give up much in terms of space, either. The Hybrid's 14-cubic-foot trunk is a bit smaller than the V-6's 16 cubic ft—the only real result—but that's only slightly smaller than last year's 14.4-cu-ft cargo space.

Selecting Normal mode, we managed to average nearly 40 mpg in a 30-mile loop, driving with varied speed in a mix of two-lane country roads, a small stretch of freeway, and through several small towns. Then only in Sport mode, tackling about 25 miles of tightly curved, rather narrow back road, we still managed to average an indicated 36 mpg.

Just as with the other variants of the 2013 Avalon, we found it to be an unexpectedly precise, deft handler, and easy to place on narrow lanes. The wallowing, bobbing, and pillowy ride of the former Avalon is history, replaced by a more Lexus-like level of damping and body control—without losing the refinement, composure, and comfort.

A premium that pays off quickly

With a price that's as little as $1,750 more than an equivalent V-6 version of the Avalon, the Hybrid is not just the green choice, but the one that makes the most long-term fiscal sense. Especially if you do most of your driving in the city, you could save more than $1,000 on your fuel budget, easily, in a single year.

In other words, this is the kind of green choice that makes sense even to your less Earth-conscious friends.

See the full review at The Car Connection for many more details, as well as more pictures, and a roundup of the feature set, safety-tech, and interior comforts in the new 2013 Toyota Avalon Hybrid.

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