According to Mercedes-Benz, up to last year one in three of its models sold globally was an SUV.

Appetites for this kind of vehicle continue to grow, and while 20 years ago they were predominantly large, the rate of growth has shifted as buyers of more compact cars have demanded something more rugged.

Mercedes-Benz launched its most compact SUV, the GLA, soon after the previous A-Class, but it never really had the look or the rugged credentials of its larger SUVs.

Now, with the arrival of the second-generation GLA, there is a larger and more practical model to slot in the gap above, between it and the GLC.

The GLB is almost as long as the GLC, but its proportions are entirely different. Imagine a scaled-down GLS and you’d be pretty close.

The vehicle accommodates three rows of seats as standard and has petrol or diesel engine options. The 163hp 1.3-litre turbocharged petrol GLB 200 comes only as a front-wheel drive variant, while the 150hp 2.0-litre diesel GLB 200d is available with front-wheel drive as standard or optional 4Matic all-wheel drive. The 190hp GLB 220d is 4Matic only.

Our test car was the GLB 220d, which produces a maximum torque output of 295lb-ft, and has performance figures of 0-62mph in 7.6 seconds and a 135mph top speed.

It would have been nice to see the car launch with a plug-in hybrid version, as Mercedes-Benz has been rolling out the technology rapidly across its range this year, although the standard petrol and diesel derivatives are highly competitive for CO2 emissions.

Mercedes-Benz refers to the GLB as a ‘compact’ model, as it’s derived from the same platform that produces the A-Class, CLA, GLA and B-Class. Its closest rivals on price and ability would be the Land Rover Discovery Sport and Volkswagen Tiguan Allspace, both of which have plug-in hybrids in the pipeline.

The GLB’s dashboard design reflects the latest versions of Mercedes-Benz’s compact models, while our AMG Line Premium test car had the so-called ‘widescreen cockpit’ with a 10.25in digital instrument panel sitting flush with a 10.25in infotainment screen on top of the dashboard.

Like the other latest models in the Mercedes-Benz range, the driver-assistance technology is linked to the navigation system, so the car can anticipate bends or roundabouts ahead and in preparation reduce speed from the limit set in the cruise control.

The GLB in 220d guise doesn’t want for performance, and the 2.0-litre diesel is remarkably quiet in most circumstances.

The ride is a little firm, especially on the 19in wheels fitted to AMG Line versions, but it helps maintain the feeling of a relatively small car, with excellent body control. Despite having enough room to accommodate seven, the GLB isn’t a daunting car to drive around town.

When all seven seats are in place there is only a tiny amount of space behind them for luggage, although this is par for the course in these elongated medium SUVs – the Discovery Sport and Tiguan Allspace aren’t really any better in this respect.

But it’s likely most GLB users will keep the car as a five-seater most of the time, taking advantage of the 560 litres minimum luggage space.

Although our AMG Line Premium is a little pricey – especially compared with the Land Rover Discovery Sport – it’s still competitive on running costs. And with CO2 emissions much lower than the Land Rover, the BIK tax is lower, as well as employers’ National Insurance contributions. We imagine the latter might eliminate the small cost-per-mile advantage the Land Rover has.

Up to now, there was a clear gap in the Mercedes-Benz range. The GLA was little more than an A-Class with increased ground clearance, while if you needed seven seats in an SUV you had to splash out on an M-Class with the third row fitted, or plump for the full-fat GLS.

We can imagine many drivers with Mercedes-Benz on their choice lists -particularly if they have a family – feeling the GLB is the model best suited to their needs.

Mercedes-Benz GLB 220d 4Matic AMG-Line Premium auto 

P11D: £41,935

Residual value: 40.3%

Depreciation: £25,035

Fuel: £6,420

Service, maintenance and repair: £2,772

Cost per mile: 57.1p

Fuel consumption: 48.7mpg

CO2 (BIK band): 154g/km (33%) 

BIK 20/40% a month: £231/£461

Boot space: 560 litres (with third row of seats folded)

Engine size/power: 1,951cc/190hp