2005 Mercedes-Benz E-Class Test Drive

Mercedes-Benz E500

The handsome new V-8 wagon from Mercedes offers tremendous power at an equally tremendous price. Is it worth it?

Is the new Mercedes-Benz E500 the perfect station wagon?

If your mental image of a station wagon is an aircraft carrier-sized vehicle within which a 5-year-old may lick a chocolate ice cream cone on a hot July day with impunity as he and all his noisy, sandy friends are being ferried back from the beach, wet towels and all, then the answer is probably no.

However, if your concept of a station wagon is one that achieves a near-perfect balance between engineering and ability, style and function, status and practicality, speed and comfort, then the E500 may very well be perfect.

When we reviewed the E500's sister car, the V-6 E320, in 2002 we were pretty excited about it and tossed around adjectives like "classy," "agile," "smart," "refined" and "logical" with confidence. At the time, we could not believe there was a better wagon on the market, and urged readers to rush out and buy this superb machine.

Then, of course, Mercedes goes ahead and one-ups itself. When it introduced the 2004 Mercedes-Benz E500 in October 2003 -- on the heels of a total redesign of the E320 -- it was clearly going for superlatives. Not only, thanks to its 302-horsepower V-8 engine, is it one of the fastest station wagons on the market, but thanks again to its V-8 engine, it is also the most expensive station wagon, with a MSRP of $59,950.

Aside from that, however, the E500 is identical to the $51,270 E320 in nearly every aspect. Each car has the same legroom, the same radio, the same cargo volume, same standard third-row seat, even the same exterior colors. The only difference -- besides price -- is the curb weight and gas mileage: The E500 weighs 4,320 pounds and gets 16 mpg in the city and 22 mpg highway, while the E320 weighs 3,966 pounds and gets 19 city and 27 highway.

(There are a few other minor differences; for instance, the E500 has standard 4MATIC all-wheel drive, which adds an extra $2,500 to the price tag.)

What inspired Mercedes to introduce the E500 wagon in October 2003? Clearly, the execs at parent DaimlerChrysler probably thought they could sell a V-8 version for a premium price. Assuming there's a market for the higher-priced car, such premium vehicles can be a gold mine. Witness how Ford Motor easily turned its Crown Victoria into a Town Car and raked in fat margins with the Lincoln's higher price. Converting the redesigned E320 would be easy and inexpensive, particularly as the V-8 powerplant is used in multiple Mercedes models.

The question, then, is whether people will find the E320 classy and powerful enough to suit them and consider the E500 a blatant stunt to separate them from their hard-earned cash. Aside from the fact that the E500 is as satisfying to drive as it is soothing to the ego, are there really enough people out there who are willing to spend $60,000-plus on a station wagon -- even if it is perfect?