DETROIT - Ford Motor Co's Fusion mid-size sedan was named Motor Trend magazine's 2010 car of the year on Tuesday, adding to the perception that changes to the No. 2 U.S. automaker's vehicle lineup are gaining traction.

The Fusion was chosen best of 23 new or significantly upgraded vehicles and the full range of Fusion models impressed the judges, from the four-cylinder entry level vehicles to the all-wheel drive sport and hybrid versions, Motor Trend Editor Angus MacKenzie said.

Ford has proven its resilience in these tough times by delivering to market a car with broad appeal to a broad range of customers, MacKenzie said.

The Fusion, which has become one of the top 10 selling vehicles in the United States, was redesigned for 2010. Ford launched the Fusion in 2006 and it set its previous annual sales peak in 2007.

What a proof point, to be named car of the year by one of the most rigorous tests in the world, Ford Chief Executive Alan Mulally told reporters at Ford headquarters after MacKenzie announced the award.

Motor Trend tested the vehicles on acceleration, braking, handling, noise and responsiveness under various road and traffic conditions. It also considered design, fuel efficiency, safety and value.

Ford posted a nearly $1 billion third-quarter profit this month that surprised Wall Street analysts and is the only large U.S. automaker not to reorganize in bankruptcy with U.S. government support in 2009.

The automaker has said it expects to return to a solid profit in 2011 with a gradual recovery in the auto industry in the United States and key regions internationally.

U.S. auto sales peaked at nearly 17 million vehicles in 2005 and have been falling since. Ford expects 2009 U.S. auto industry sales of about 10.6 million units including medium and heavy trucks, or around 10.3 to 10.4 million light vehicles.

We are cautiously optimistic that we are near the bottom right now, Mulally said of the U.S. auto market.

Ford's shares reached a more than two-year high on Tuesday, a day after billionaire investor George Soros' hedge fund disclosed taking a 7.3 million share stake in Ford during the third quarter.

U.S. 2009 sales of the Fusion were up 15 percent through October at 148,045 but trail Toyota Motor Corp's Camry and Honda Motor Co Ltd's Accord in the mid-size sedan segment, one of the key areas in the U.S. market.

Dearborn, Michigan-based Ford has looked to set itself apart from U.S. rivals General Motors Co and Chrysler Group LLC, which reorganized under government-funded bankruptcies this year, and increasingly uses Toyota and Honda as benchmark competitors.

Sales of the Fusion have helped keep Ford's U.S. sales declines for 2009 slower than the overall drop in the industry. Through October, Ford's U.S. sales are down 20.4 percent for the year, while the industry is down 26 percent.

Ford shares were up 15 cents, or 1.7 percent, to $8.86 in Tuesday afternoon trading on the New York Stock Exchange. Earlier on Tuesday, the stock reached $9, a more than two-year high that is also a nearly 29 percent increase since Ford posted its third quarter profit in early November. (Reporting by David Bailey, editing by Gerald E. McCormick and Tim Dobbyn)

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