2005 Mercedes-Benz C-Class Test Drive

Cramped in the Lap of Luxury

A great-handling Benz family car. But is it a cost-effective buy?

Mercedes, a unit of Daimler-Chrysler, sold 88,655 cars through the end of May this year, an increase of 2.2% over the same period in 2002. That's in contrast to Volkswagen, which saw a 12% drop in sales, and BMW which, discounting the hot-selling Mini brand, saw a slight downtick as well. Audi, too, has seen sales dip 5.2% so far in 2003.

Why are Mercedes sales increasing in the face of tough competition? It could be that the brand's ever-proliferating lineup (C, CL, CLK, E, SL, SLK, S, ML, and G classes, and several versions of each) now finds buyers in nearly every price class and buyer niche. But my hunch is that Mercedes' recent gain reflects a blip in other brands' product cycles and also a simple fact: In a down economy a "safe" luxury buy just feels smarter. Sure, Audis and Mercedes depreciate at nearly the same pace, but psychologically the Benz feels like a more intelligent purchase.

As for the aforementioned product cycle discrepancy, Mercedes is just in a better position right now.

Audi is only now replacing the ancient A8 while the Benz S-Class was updated far more recently, and the new BMW 7 series is considered controversial-looking. Meanwhile, BMW's new 5 series has just been replaced (and isn't even for sale yet) while the new, splendid E-Class has been on sale since last fall.

Finally, and most critically, Mercedes has been smart to make its C-Class cars even more cost competitive against marques like Lexus and Acura as well as Infiniti. Did you know you can get a C230 sports coupe for only $25,615? That's on par with the cost of the Honda Accord Coupe.

In a similar vein, when you start to add options to the likes of the typical economy wagon, they begin to look too expensive. Why get Subaru's top-line H-6 3.0 Outback Wagon for $31,420 when for a few grand more ($36,700) you can get a far more prestigious C320 Mercedes-Benz wagon?

Then again, this logic only goes so far. BMW has only sold about 1,500 of its 3 series wagons this year (base sticker: $29,000), a mere 4% of total 3 series volume. Meanwhile Volkswagen's Passat Wagon is larger than the 3 series model, carries some import cachet (at least, say, versus that of a Subaru), is cheaper than a BMW or Mercedes wagon and consequently one in every four Passat sales is in wagon format.

Where does that leave the Mercedes C320 4Matic Wagon? Well, in good stead. See, it's bigger inside than the BMW 3 series wagon and has more cargo room than the Passat wagon as well -- and more than that of Audi's A4 Avant. Further, the C320 wagon is (shhh!) a blast to drive, running to 60 mph in only seven seconds, and like the competition, can be had with all-wheel-drive (4Matic in Mercedes parlance), for extra cornering grip especially in nasty weather.

Sounds good, doesn't it? What else did we like -- and dislike? Read on.