THE VAN STARTED TO SPUTTER AND THE ENGINE CUT OUT WHILE DRIVING ON THE HIGHWAY AT 60 MPH. I MANAGED TO COAST TO THE SIDE OF THE HIGHWAY AND NOTICE SMOKE ENTERING THE PASSENGER COMPARTMENT. THE SMOKE DIDN'T SMELL LIKE STEAM FROM OVERHEATING BUT A THICK BLACK SMOKE. I MOVED A SAFE DISTANCE FROM THE VAN AND CONTACTED THE POLICE AND FIRE DEPARTMENT. THE ENGINE COMPARTMENT BURST INTO FLAMES BY THE TIME THE FIRE DEPARTMENT ARRIVED. THE VAN WAS A TOTAL LOSS AND THE ESTIMATED DAMAGE WAS $13000. THE INSURANCE COMPANY WROTE OFF THE VEHICLE AND ONLY PAID $9000. I SUSPECT THE PROBLEM OF FUEL VAPOURS (APPEARS TO BE COMMON IN THE MERCURY VILLAGER) IN THE ENGINE COMPARTMENT WERE IGNITED BY A SPARK FROM THE PLUG WIRES FROM RAIN ENTERING THE ENGINE COMPARTMENT AT HIGHWAY SPEED. THE DEALER HAD REPLACED THE FUEL FILLER GASKET UNDER A RECALL A MONTH EARLIER.