When Mercedes entered the market for suburban SUVs in 1998 (in contrast to the authentic bushwhacking SUV market, served by its G-class "Gelandewagen" since 1979), the company anticipated that there would be a customer emphasis on "sport" and "utility" because, after all, the ML is a sport utility vehicle.

But consumers actually use mid-size SUVs as family wagons, jockeying with minivans for parking at little league practice, rather than as hose-?em-out off-roaders. And, when there is a three-pointed star on the grille, customers expect to be coddled in the lap of luxury while behind the wheel, all wheel drive notwithstanding.

The 2012 ML350 represents the third generation of this pioneering luxury wagon, and Mercedes is increasingly in tune with customers' desires to be able to reach their lake house or ski chalet in the comfort and style to which they are accustomed. Addressing that expectation, the company has designed a richly appointed interior that the company hopes will raise the bar for luxury SUVs.

"We have nicer ornamental parts; wood ornamental parts and also metal and leather," explained Hartmut Sinkwitz, director of interior design. "We think in high quality materials right from the start of the process. Our customers keep telling us this is what is appreciated."

This stands in contrast to the original M-Class, whose interior was all-around less opulent. The target at that time was the popular Jeep Grand Cherokee. But shoppers expect more from Mercedes than from Jeep, so now buyers can choose between four different kinds of wood trim, or opt for aluminum.

The company has high hopes for one unique interior option, featuring leather stitched in a quilted pattern. The complimenting matte-finished wood lends an especially contemporary appearance. "We are convinced this will set new quality benchmarks," enthused Sinkwitz. Coincidentally, Jeep will have something to say about that, as the new Grand Cherokee, which shares its fundamental underpinnings with the ML350, earned a spot on trade journal Ward's Automotive's list of the ten best interiors for 2011.

In addition to comfort, another traditional SUV shortcoming has been fuel economy, and Mercedes has attacked that issue just as vigorously as it did cabin appointments. The 2012 ML350 features an all-new 302-hp direct-injected 3.5-liter V6 as its main powerplant, with a 258-hp 3.0-liter turbodiesel V6 as an optional engine for diesel aficionados.

The gas engine promises to be 25 percent more fuel efficient than its predecessor, which is rated at 15 mpg on the EPA's city cycle and 20 mpg highway. The diesel is forecast to be 22 percent less thirsty than the outgoing model, which scored 18 mpg city and 25 mpg highway. The twin-turbo 4.7-liter V8 already seen in the S-Class will arrive eventually as a V8 option.

The all-new seven-speed automatic transmission contributes a 14 percent hike in fuel economy by itself, but the transmission is also ready for off-road use. The off-road program alters shift point and transmission slip thresholds, while also applying a more linear curve to the electronic throttle for less jumpy response while crawling over rocks and a different antilock braking program to deal with stopping on loose surfaces.

The high-end model equipped with air suspension has always been adept at meeting the competing demands of on- and off-road driving, but now even the basic model with conventional steel springs benefits from adaptive shock absorbers whose damping characteristics change to suit requirements.

This combination of opulence inside and intelligence under the skin means that the 2012 ML350 bridges the gap between off-road capability and country club exclusivity.

author photo

Dan Carney is a veteran auto industry observer who has written for MSNBC.com, Motor Trend, AutoWeek, The Wall Street Journal, The New York Times, Popular Mechanics, Popular Science, Better Homes and Gardens and other publications. He has authored two books, "Dodge Viper" and "Honda S2000" and is a juror for the North American Car of the Year award. Carney covers the industry from the increasingly strategic location of Washington, D.C.

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