But the business case for large hybrids has often been tricky. Lexus and Infiniti both cater for markets such as the United States and Japan, where air quality regulations make petrol-electric hybrids the powertrain of choice. In Europe, where CO2 emissions are the tax yardstick, hybrids can struggle to compete financially with an efficient diesel engine.

So while Mercedes-Benz is a late entrant, it’s taken perhaps the cleverest approach. The E-Class is the first vehicle to get the carmaker’s modular hybrid system. It’s small enough not to need any body modifications, scalable for more power, adapatable for plug-in technology, and most importantly compatible with both diesel and petrol engines.

As a result, the E-Class Hybrid is available as both saloon and estate, with two powertrains. The E400 Hybrid is powered by a petrol engine and destined for the traditional hybrid-loving markets. But Europe will get a E300 BlueTEC Hybrid, with the familiar 202bhp 2.2-litre diesel, a unique proposition in its class and the most efficient executive car on sale, at 67.3mpg with CO2 emissions of 109g/km.

The tax advantages go even further in the UK. Not only does it offer the lowest emissions in its segment, for now, but until April 2016 this also gets the head start of avoiding the 3% diesel BiK surcharge applied to conventionally-powered low-CO2 models, which should cover up some of the additional screen price.

Keeping the battery small and reducing the need for body modifications means it’s also reasonably cost-effective to build. UK prices haven’t been announced yet, but in Germany the hybrid system adds around £3,000 to the price of an equivalent E-Class, placing it between an E300 CDI and E350 CDI when it goes on sale later this year.

Hybrid technology fits the executive class perfectly. At startup, the E-Class whispers along using the compact motor sandwiched into a 65mm space between the engine and gearbox, and most low-speed manoeuvring and low-load acceleration is done on electric power. In traffic it works a little like a stop/start system, albeit one which shuts the engine off more regularly and before the car has come to a full stop.

But this really comes into its own at higher speeds, where the drivetrain offers smooth, brisk acceleration assisted by the electric motor. It’s also surprisingly easy to put the car into its ‘sailing’ mode by lifting off the throttle slightly, deactivating and decoupling the engine for silent electric-powered motorway cruising at up to 100mph. The only thing that’s noticeable from behind the wheel is the increase in resistance as the motor switches to become a generator, which feels like someone brushing the brake pedal very lightly.

So from a position where BMW and Audi have been able to offer lower-carbon alternatives to Mercedes-Benz’s luxurious executive carrier, the three-pointed star has come back to steal a lead over its rivals with this impeccably well-thought out hybrid. 

If UK pricing is as well considered, especially relative to the 119g/km E220 CDI BlueEFFICIENCY coming within the year, this could be the first hybrid executive car to make real financial sense for fleets.

Verdict:

Mercedes-Benz has engineered its modular hybrid system so well that it’s surprising none of its rivals offer something similar. The E300 BlueTEC Hybrid will offer considerably lower ownership costs compared to its petrol-powered closest rivals, but the carmaker needs to make sure higher pricing doesn’t offset the tax advantages too heavily.

Spec:

Segment: Executive

Type: Diesel-electric hybrid

Price: £43,000-£46,000 (TBC)

Fuel: 67.3mpg

Electric range: 0.6 miles

CO2 emissions (tailpipe): 109g/km

Charging port: N/A