Traveling first-class at 31 mpg

Where I come from, a Mercedes-Benz diesel is synonymous with a taxi. Like in many European cities, in Israel, diesel-powered E-Class taxis roam city streets much like the hulking Ford Crown Victoria does in Manhattan. So, for me, an E-Class diesel should be the last thing from sexy transport. In addition, it's no secret among the staff here that I'm no fan of diesels. And in the recent debate about whether diesel is the better approach than hybrid, I'm clearly in the hybrid camp. And then I drove our new E320 Bluetec. "Bluetec" is a name for Mercedes' latest clean-diesel modular technology. Next year, it will add urea injection to further remove nitrogen oxides.

Strikingly, to anyone who's ever been exposed to a diesel, this E320 doesn't smoke, smell, clatter noisily or vibrate, and it's certainly not slow. You wouldn't know it's a diesel unless you stood close to the engine at idle. Cold morning starts are completely free of smoke and smell. It should be said, that due to legislated changes for 2007, new diesel engines are now required to be cleaner and use only ultra-low-sulfur-diesel fuel.

On the road, the Bluetec E320 provides a mid-range punch that makes it feel like a V8. No wonder, since it supplies 388 lb-ft of torque from as low as 1,600 rpm--no small feat from a relatively small 3.0-liter displacement. The 208 horsepower appear quickly at 3,800 rpm. As in any E-Class, the chassis is terrific as it provides a magic carpet-like ride yet agile handling, with quick, precise steering. The seats and driving position are first class. And here is the kicker: on my 75-mile daily commute, it gets 31 mpg. That's more like the fuel economy of the much smaller and lighter Honda Fit.

Clearly, this begs the question: How does the E320 compare to the regular gas-powered E350 (which we're also testing)? At $54,715 vs. $53,715, the E320 Bluetec costs an extra $1,000 when equipped with the popular Premium I Package. The E350's 3.5-liter V6 puts out a healthy 268 hp, but not before 6,000 rpm are piled on, and the 258 lb-ft of torque comes on tap at 2,400 rpm. In other words, is the E350 is quick but requires more revs. And on the same commute, I get 24 mpg with the gasoline V6.

In calculating the costs, let's assume I do my commute five times a week, 50 weeks a year, and using the current $3.15 for a gallon of diesel versus the $3.45 for a gallon of Premium (right now, diesel is even cheaper than regular here in Connecticut, but that's not always the case). With the E320, I'd spend $3,810 for fuel annually; with the E350, I'd shell out $5,390. That's $1,580 ahead for the diesel, meaning a payback time of about seven and a half months for the extra $1,000 purchase price. And that's before counting the 562 gallons of petroleum saved.

So for the first time ever, I find myself in a virtual dilemma whether to choose the diesel or the gas. Ah, the suffering one must endure ("Which E-Class should I drive today?") in the name of science!

--Gabe Shenhar