If you think we need more taxpayer-subsidized Chevy Volts or assorted hybrids to boost the overall fuel efficiency of American cars, you might want to read a story from the latest Bloomberg Businessweek.

When Doug Hacker decided he needed a car that was light on gas, he figured a Toyota (TM) Prius hybrid was the way to go. Many of his co-workers at Procter & Gamble’s (PG) soap research lab in Cincinnati drove Priuses and bragged about getting more than 50 miles per gallon. After a little research of his own, Hacker made a surprising discovery: While more costly hybrids still win the mileage competition, he could save more money by buying a Ford (F) Fiesta powered by a technology that’s been around for 151 years—the internal combustion engine. That’s because the efficiency of conventional engines has improved so much that the mpg gap is closing, making it harder to justify paying more for gas-electric hybrids.

“I was surprised to see that cars like the Fiesta were actually about a nickel cheaper to run per mile than the Prius,” says Hacker. He bought a Fiesta for $16,400 instead of a $23,015 Prius. He’s averaging 37 mpg, which he says is on par with the real-world mileage of his Prius-driving friends who don’t take extreme measures to boost their mpgs. (“To get 50 miles per gallon, some dress like Eskimos because they don’t want to turn the stinking heat on,” says Hacker.)