Mercedes E250 CDI Blue Efficiency Avant Garde

Price: £31,425
Top speed: 149 mph
0-60mph: 7.4 seconds
Consumption: 53.3 mpg
CO2 emissions: 139g/km
Best for: German taxi drivers
Also worth considering? Audi A6, BMW 5-series, Jaguar XF

Big car, small engine. It's an idea whose time has come, and with its outstanding new E Class saloon, Mercedes has embraced it in full, especially where the mid-range variants, the petrol-engined E250 CGI and the diesel-powered E250 CDI, are concerned.

Under Mercedes' traditional model-numbering system, a car with a "250" badge on its boot-lid would normally be expected to have a 2.5-litre engine under its bonnet – and past Mercedes engines of that size had five or six cylinders. These new 250s have small four-cylinder units – of 1.8 litres capacity in the case of the CGI and 2.15 litres in the case of the CDI – but nobody who buys either of them is going to feel remotely short-changed.

The CGI uses an engine-driven supercharger to deliver a big shove in the back when it's needed – in the CDI a pair of turbochargers does the same job. The rest of the time, these small engines sip only modest amounts of fuel, providing a blend of economy, performance and low emissions that would have been unimaginable in a big car just a few years ago. The diesel is probably the pick of this convincing pair; its enormous 500 Newton metres of torque – or low-end pulling power – making for truly effortless progress and putting most other cars on the road in the shade.

But while the new "E" has adopted the decidedly new-fangled notion of putting small, powerful engines into a large body, in most other respects it marks a welcome return to traditional Mercedes virtues. It's no particular secret that the company lost its way a bit in the late Nineties, rapidly expanding its model range and losing something of the relentless focus on quality on which its then-peerless reputation was built. We won't, of course, know the truth of the matter for another decade or so, but after having a good old poke around the new E Class and speaking at length to many of those who were involved in its development, I think Mercedes may just have finally fixed the problem. This car has the sort of solidity and confident, square-jawed, masculine good looks that were missing from its predecessor; it even goes so far as to borrow the crease above its rear wheel arch from the celebrated "Ponton" model of the Fifties in an effort to please the traditionalists.

How will this impressive E Class fare in the market? It's going to be a case of big car, small engine, big sales, I think, even in these difficult times.