The latest-generation E-Class saloon is an excellent car. Fact.

It set new standards in interior luxury, modern advanced tech and supreme ride quality when it was launched last year, and following in the footsteps of its smaller C-Class sibling, is now also available as a plug-in hybrid.

To tell the plug-in hybrid apart from its combustion counterparts, there’s badging on the side wings, blue inlays on the LED headlamps and (our particular favourite) blue front brake pads.

Powering the 350e is a combination of a turbocharged four-cylinder 2.0-litre petrol engine and a 6.4kWh battery, and the headline official figures include up to 134.5mpg combined and CO2 emissions of 49g/km.

Side

Unrealistic headline figures

These figures should be taken with a pinch of salt, though, and are entirely based on you utilising the 21-mile electric range as much as possible. The fuel economy figure in particular is completely unattainable, as is the case with all plug-in hybrid official figures.

Our car is fitted with standard 19-inch alloys, which pushes CO2 emissions up to 57g/km and fuel economy down to 113mpg, something to bear in mind when looking at BIK as the car misses out on the lowest tax bands currently saved for under-50g/km cars.

As a tax-efficient company car, the E-Class plug-in works very well indeed. But if you’re planning on travelling long distances and not utilising the electric battery fully, it’ll end up costing you dearly in fuel – so you need to make sure you’ve done the sums before choosing it as your next company car.

To drive there’s little compromise from the added weight of the battery. The car is still sublimely comfortable and refined on the road – you’ll only really notice the compromise in the corners, with the plug-in not quite as poised as its diesel brethren. There’s a choice of hybrid driving modes too, including electric-only and a save function, which allows you to reserve the battery power for when your journey heads to more urban territory.

Inside

Like the standard E-Class saloon, you can also select a range of driving modes which make modifications to the throttle and suspension set-up to suit. Sport and Sport+ mode unleash the car’s full potential – it’s a lot of fun when venturing onto your favourite country lane, but don’t expect the battery range to last long if selected.

Officially, the car will complete the 0-62mph sprint in just 6.2 seconds, while the traffic light dash will put some performance cars to shame thanks to the immediate torque on offer.

The regenerative braking is refreshingly subtle too, unlike many other electric cars, adding to the overall smoothness, while using a modern public charger or a fitted wallbox will recharge the vehicle fully in two hours. 

A costly option compared with the diesel

The biggest downside is boot space, which is cut by 140 litres versus the standard saloon to 400 litres to make room for the batteries. It’s also pretty expensive, costing almost £10,000 more in P11D than the E220d in the same spec.

Whole-life costs are higher than the E220d AMG Line too at 83.9p and 74.6p per-mile respectively, while the diesel holds its value better too, with a 42% residual value versus the 350e’s 38.4% figure.

Like the standard car, the 350e comes generously equipped with luxuries including heated front seats, LED lights, reversing camera, adaptive cruise control, leather upholstery and Apple CarPlay all included.

Rear

There’s also some pretty cutting-edge energy management functions available that utilise the car’s cameras and radar to allow the 350e to adapt to the road and traffic conditions to get the most out of the range.

Like many modern-day electric-powered models, the E350e also comes with an app that allows you to precondition the car and preset the sat-nav – ideal for those early-morning starts.

The plug-in E-Class is based on an excellent car, and on that basis alone is difficult not to recommend. You’ll just need to do the sums and ensure you can properly utilise the electric range to make it cost-effective – especially as rising BIK tax bands and incentives for plug-ins are likely to dwindle over the coming years.

Mercedes-Benz E 350e AMG Line Saloon

P11D Price: £47,950
On sale: Autumn 2016
Residual value: 38.4%
Fuel: £2,901
Service, maintenance & repair: £3,378
Cost-per-mile: 83.9p
Fuel consumption: 113mpg
CO2 (BIK Band): 57g/km (11%)
BIK 20/40% per month: £88/£176
Boot space: 400 litres
Engine size/power: 1,991cc/211hp + 88hp 6.4kWh electric battery