While the U.S. hunts for a solution to its dependence on foreign oil, Europe has already settled on one: diesel. Influenced by high fuel prices and tax incentives, Europeans purchased diesel engines in over half of the new cars they bought last year. In Austria, Belgium, and France diesel's market share was over 70 percent. And, with fuel prices now over six dollars a gallon in many countries, this share will only continue to climb. As a result, if you want to sell cars in Europe, you had better offer a diesel engine.

The situation is much different in the U.S. Hardly any diesel-powered cars are bought here. The diesel fuel here is relatively high in sulfur, making it hard to meet current emissions regulations. At the same time, this fuel is more expensive than gas despite being cheaper to produce, likely because sales volumes are much lower. Toss in lingering memories of the slow, noisy, unreliable diesel engines General Motors rushed to market following the 1979 surge in gas prices, and most manufacturers figure that the demand for diesel engines would not justify the effort of offering them. At present, if you want a diesel-powered car it's going to be either a VW or a Mercedes.

VW's 100-horsepower four-cylinder earns exemplary fuel economy ratings, but performs little better than GM's infamous eight. While impressive from an engineering standpoint--the VW engine is only about one-third the size of GM's--slow is slow.

With twice the power output of the VW four, Mercedes' V6 diesel should better demonstrate what all the fuss is about in Europe. To find out, a friend of mine and I took an E320 CDI sedan for a test drive.

This review also covers the gas V6, which is a new 3.5-liter for 2006. A few years ago I drove and reviewed the V8-powered E500. That review can be found here.

Styling

The previous E-Class, sold from 1996 to 2002, brought a bit of whimsy to stolid Mercedes in the form of oval headlights. The rest of the car unfortunately maintained the upright, squarish styling of the previous E-Class. The front end did not really mesh with the rest of the car.

The current E-Class, introduced in 2003, doesn't have this problem. The car's proportions are perfect, and the sheetmetal flows beautifully from front to rear.

The main negative with the exterior is common to fluid designs: even though it is virtually the same size, the 2003 appears much smaller than the previous car. I have a trained eye for such things, yet to me the new E-Class looks little larger than the much less expensive C-Class. Especially with the wagon I've often mistaken an E for a C.

The only other negative is that the beauty of this design might be too subtle for some. A BMW 5-Series, Audi A6, Cadillac CTS, or Lexus GS is much more likely to attract attention--and polarize opinion. The ultra-swoopy E-Class-based Mercedes-Benz CLS also performs well in this regard. Personally, I prefer a subtle design devoid of garish details.

The E320's standard 16-inch wheels suit the car well. The 17s standard on the E500 and optional on the E350 gas-powered models further improve the appearance of the car, but they're not available with the diesel.

Inside the story is much the same. The interior styling, much more fluid than Mercedes of yore, is very attractive. In my 2003 test drive I found the light gray interior lacking in terms of ambiance. It looked wash out and felt emotionally frigid. The word "antiseptic" came into play. The black interior in the 2006 diesel feels more in keeping with the car's mid-fifties price. We drove the E-Class immediately after driving a new C230, and the larger car's interior looked and felt far richer. Especially the instrument panel, which contains too much hard plastic in the C-Class.

Mercedes' decision to include a large analog clock in its instrument clusters continues to befuddle me. In the E-Class, this clock is as large as the tach, and occupies an equally prominent position. Is this to enable the time to be checked on the fly? Sticking the thing on the left side of the instrument cluster prevents passengers from viewing it. This not only limits the clock's functionality but keeps it from serving the primary purpose of putting an analog clock in a car in the first place: ambiance. For this reason, just about every other car with an analog clock has it prominently located in the middle of the dash.

Accommodations

Mercedes does tend to get the driving position right. In the E-Class, as in other Mercedes sedans, the driving position is higher relative to the dash than in other European luxury sedans. I like the visibility and airy ambiance this provides. The E320 I drove had the standard front seats. They are good, but not great, in terms of comfort and support.

I past years, E-Class seat options have included “multicontour” seats with larger, power-adjustable side bolsters and additional power adjustments for lumbar support and cushion length. In a "drive dynamic" variation the seat bolsters automatically inflated to better support the driver in turns. I'm not sure if these options were ever available with the diesel, and they're only available with the high-performance AMG E55 this year.

Rear seat passengers fare less well. To maintain headroom with the sleek roofline, the rear seat is positioned close to the floor. This tends to lead to inadequate thigh support. To compensate, the cushion rises dramatically to a prominent leading edge, like a ski jump. So thigh support approaches adequate. Not so good is knee room, which feels more compact than midsized. A shortage of toe room under the front seats does not help. The difference in rear seat room between the E-Class and the C-Class is not as large as it should be. Many competitors offer significantly roomier and more comfortable rear seats.

Trunk room is somewhat better than the average for this class. In the previous E-Class the rear seat did not fold for more cargo room. In the new car, a folding rear seat is a $300 option. Good to have, but free on any low-buck Korean subcompact. At one point a folding front passenger seat was supposed to be offered, but I'm not sure if one ever actually was, and none is listed for the 2006 car.

On the road

And now we finally come to the focus on this review, the diesel engine. Diesels have heavier internal components and much higher compression ratios than similarly-sized gas engines. For these and other reasons, they have lower redlines and their torque output peaks at a relatively low RPM and then falls fairly rapidly.

Frankly, this perfectly suits how most Americans drive. The 3.0-liter V6 in the Honda Accord impresses with a 244-horsepower peak output, but this is achieved at 6250 RPM. The typical American driver rarely revs an engine this high. Even the Accord's torque peak at 5000 RPM will rarely be attained. (Torque is the force with which the engine twists its output shaft; horsepower is essentially torque multiplied by the number of twists.)

For 2006, Mercedes replaced a 3.2-liter, 18-valve V6 with a new 3.5-liter, 24-valve unit. Not only is power output up 47 horsepower, to 268, but the new engine feels smoother and revs more easily. In the E-Class it performs very well, making the current 5.0-liter 302-horsepower V8 much less attractive than before. (A new, 5.5-liter V8 good for about 350 horsepower is on its way.)

Much like the Honda engine peak power won't often be extracted by the typical driver, coming as it does at 6000 RPM. The Benz engine's torque peak is considerably lower, though, coming at only 2400 RPM. The V8 has a larger advantage here, producing 81 more foot-pounds, 339 vs. 258. In other words, as good as the new six is the current eight will still feel considerably stronger at typical around-town engine speeds.

Then there is the diesel: it produces 369 foot-pounds of twist at a very low 1800 RPM. Diesels benefit even more than gas engines from turbocharging, such that normally aspirated diesels (like those offered by GM in the 1980s) are now rare. Turbos often take a moment or two to spool up, yielding "boost lag." Such lag is minimal in the E320. Instead, the diesel feels every bit as strong as its torque stat suggests. Even more than the V8-powered E500, the E320 CDI leaps off the line. Floor the throttle, and you will promptly feel a strong pull in your gut. Keep it floored, and you'll reach sixty in under seven seconds--about ten sooner than one of those GM diesels. Squirting the car into a hole in traffic is a snap. And quite fun. A gentle stab at the accelerator will do ya.

Peak horsepower is a hundred shy of the V8s, but as mentioned above few American drivers will often rev the engine high enough to experience this additional power. At lower RPM the diesel is more powerful than the 5.0-liter V8, and the big gas engine only gains a significant power advantage over 4500 RPM.

Since diesels also use only about one-third as much fuel as a gas engine when idling, and last pretty much forever, it should come as no surprise that the E320 CDI often serves as a taxi cab in Europe. New York cabbies would love this car.

Diesels have a reputation for being loud and smelly. However, recent technological advances including ultra-high fuel line pressures and the injection of fuel directly into the cylinder (rather than the intake manifold) have largely eliminated these issues. Few people listening to the E320 would realize that it's a diesel.

Given this performance, even a small increase in fuel economy would justify the diesel's $1,000 higher price. But the increase is substantial, about 50 percent. The E350 earns ratings of 19/27, and the E500 17/25. The E320 CDI: 27/37. The salesperson said people regularly get 30 MPG in this car. In a quick luxury sedan this is simply amazing. With fuel at $3 a gallon, it should only take the average driver less than a year-and-a-half to earn back the diesel's extra cost.

So why get the E350? If you want a rear-drive sedan, you simply shouldn't. However, the diesel engine is not available in the U.S. in wagon form or with all-wheel-drive. A pity. A diesel all-wheel-drive wagon would be an excellent SUV alternative. Then again, the new R-Class will quite likely kill off the wagon. Unfortunately, it also is not available with the diesel.

Mercedes now offers a seven-speed automatic with its gas engines. In my experience this transmission often has trouble deciding what it wants to do, so the continued pairing of the five-speed automatic with the diesel is not a loss. The older transmission tends to be much better-behaved. It might also be more reliable: Mercedes bought back a new S-Class from my parents' neighbor because its seven-speed failed multiple times.

With the E-Class' electrohydraulic brakes, the brake pedal does not directly operate the brakes. Instead the pedal sends a signal to a computer which then operates the brakes. In case this system fails, a conventional hydraulic system is in place to serve as a back-up. According to Mercedes, which first offered this system on the new SL, it permits faster reaction times. This is likely so, but the main thing I notice is that the brakes can be touchy at low speeds.

The semi-active hydraulic suspension standard on the E500 is not available with the diesel. Instead, the oil burner makes do with conventional steel coils. No matter, this suspension rides smoothly enough. Though road noise is a bit higher than in a Lexus, especially on patchy pavement, wind noise is low. The diesel can go over 700 miles on a tank on the highway, and the car's comfort and ride quality make this relatively practical as well as possible.

I've left handling for last, for this was my main disappointment with the car. Especially compared to the C230 I drove immediately beforehand, the E320 handles soggily. The car hesitates to change direction, and the front end gets floaty under hard acceleration. My friend liked it to the Lincoln Town Car his grandmother once owned. I wouldn't go quite that far, but that the two beg comparison is telling. The E350, while still not quite a sport sedan, handles with more agility and feels more tied down. The likely cause: a diesel engine weighs more than a gas engine, about 130 pounds more in this case, and this throws off the car's balance and compromises its agility. No sport suspension is offered.

Mercedes-Benz E320 CDI (E-Class) Pricing and Price Comparisons

Like other Mercedes sedans, the E-Class is priced significantly higher than every competitor save the BMW 5-Series. And even the 5-Series is a bit less expensive. With the gas engines I prefer the BMW. But if you want excellent fuel economy in your luxury sedan, the Mercedes is your only choice, at least until Lexus introduces a hybrid version of its GS sedan.

Prices change frequently, and differences will vary based on feature level. To quickly generate these and other comparisons with the specific features you want, visit my Web site, www.truedelta.com. (It's the only site that provides true "apples-to-apples" price comparisons.)

TrueDelta's page for the E-Class:

http://www.truedelta.com/models/E-Class.php

Last words

The E-Class is a beautiful car that generally performs well. The new V6 is about as good as any in the class; what it lacks in technology vs. the BMW 530i it makes up for with an extra half-liter of displacement. And the performance of the diesel is astounding, especially at the moderate engine speeds typical of around-town driving.

Where the E-Class fails, especially with the diesel, is in handling. A 5-Series is much more enjoyable along a curvy road. But handling might be lower on your list of priorities than it is on mine. Maybe you want a car that effortlessly moves through traffic or goes an extreme distance between fill-ups. If so, and if a roomy rear seat also isn't among your priorities, then the E320 CDI could well be your perfect car.

The diesel's $1,000 extra cost is amazingly low, especially coming from a brand that charges $1,080 for a rear obstacle detection system. (Ford charges $250 for a similar system.) Just another odd decision by Mercedes, only this time in a very positive direction.

One thing I am certain of: the American market needs more diesels like that in the E320 CDI. With fuel prices where they are, and American driving habits being what they are, such diesels could easily comprise half of the market given wide availability. Even Mercedes only offers this engine in one model in the U.S., the E-Class sedan. It seems a perfect match for the M-Class and GL-Class SUVs and the R-Class crossover.

Mercedes-Benz E320 CDI (E-Class) Reliability

Some things I cannot practically cover within the context of a review because of frequent changes, a large number of variables, or both. One of these is reliability information. However, many people are interested in such information, so I've started collecting my own data. Results, once they are available, will be posted to my site, www.truedelta.com, with updates every three months.

Unlike other sources, TrueDelta will clearly identify what difference it will make if you buy an E320 CDI rather than something else by providing "times in the shop" and "days in the shop" stats (among others). You will be able to specify the number of years, annual miles, and types of repairs to include in E320 CDI reliability comparisons (or other E-Class reliability comparisons).

Before I can report results, I need data on all cars--not just the E-Class--from people like you. To encourage participation, those who help provide the data will receive free access to the site's reliability information.

For the details, and to sign up, visit www.truedelta.com.

In advance of the data, I will venture one guess: the diesel engine won't be a key source of problems in the E-Class. Properly engineered diesel engines tend to last far longer than gasoline engines, often lasting for hundreds of thousands of miles. If recent history is any guide, you'll have much more to fear from the car's complex electrical system.

A link to my website and alphabetized links to my other vehicle reviews can be found on my profile page.

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Some of my reviews of related vehicles:
BMW 5-Series review
Cadillac STS review
Infiniti M35 review
Jaguar S-Type review
Lexus GS review
Lincoln LS review
Mercedes C-Class review
Mercedes E500review
Mercedes R-Class review