DaimlerChrysler has confirmed that a diesel version of the new 300C luxury sedan is headed for Europe.

Detail timings and engine specifications were not provided for the new car, which goes on sale in Europe this month. But, at the international press launch in France on Friday, Chrysler UK said it would launch both petrol and diesel versions of the right hand drive version together in October 2005 and expects the oil burner to dominate the sales statistics.

The long delay for RHD reflects the delay in making a business case for right-hand drive models and the re-engineering consequently required. A RHD version of the 300C Touring – Europe’s wagon equivalent of the North American Dodge Magnum – has not been confirmed.

Nor has the diesel 300C’s engine. The engine bay, designed for V6 and V8 models, looks a little tight lengthwise for the 3.2-litre straight-six Mercedes turbodiesel but there is a four-litre V8 (used in the left hand drive S-class line) in the parts bin while others are rumoured to be under development, such as an all-new three-litre unit set to also appear in Mercedes models such as the E-Class, with which the 300C shares some unseen components.

“We don’t under-estimate the size of the executive diesel market in Europe and we’re very conscious of [the need to boost] residual values [by including a diesel],” an insider said.

Chrysler UK is aiming for 2,000 300C sales a year in a sector where Mercedes sells 18,000 cars. As with previous Chrysler passenger models, it is playing the value card, offering a large, V8-powered, true five-seater, dripping with equipment, at the sort of price that buys a top-line four or six-cylinder Toyota Camry or Saab 9-5 in the UK – £20,000-£28,000 is the Swede’s price range.

Key targets include the Merc E-class, Audi A6, and Jaguar S-type in a segment dominated by married male buyers averaging 51 years of age with average household income of £71,400.

Chrysler UK sees the 300C’s attributes as its distinct design, all-new rear-wheel drive technology (the US all wheel drive option may come later), the 5.7-litre Hemi V8 engine (a 3.5-litre V6 is an alternative), claimed “exceptional” interior room (said to be more than an Audi A8 or BMW 7-series) and world-class safety features.

Still, Chrysler UK acknowledges it will have to claw itself out a niche in a contracting potential market – the so-called E-segment nose-dived from 92,405 cars in 1999 to 73,200 last year as the Merc, BMW and Audi slice of the cake rose in the same period from 40% to 53%.

A drive in southern France indicated that the car has good potential to achieve its modest goals. Engine performance and refinement are well up to scratch though Chrysler has just discovered the five-speed automatic (fitted only with the V8) as European rivals move to six and seven-speeders.

Handling is generally good and comfort a strong point though the high-speed ride is a bit floaty and the car seems to need constant correction at the straight-ahead; it lacks the immense feeling of stability you get in the BMW and Mercedes rivals; we have no recent experience of the Jaguar or Audi contenders.

Interior plastics need work. As a colleague noted: some of the interior finish is more in line with the cabin of a posh Hyundai than a BMW or Mercedes; we won’t even mention Jaguar.

Still, it’s a good first effort and the progress of Chrysler’s 300C in Europe will be something to watch with interest after the failure of Cadillac’s front-drive Seville STS launched about five years ago.

And there is more to come from Chrysler. By 2007, there will be 18 LHD models on sale across the Continent (up from nine in 2003). Eight will be diesel (up from four) and 12 (6) will be sold with RHD. And some will have the Dodge badge as the brand makes a new foray across the Atlantic. UK American car fans, rejoice!

Graeme Roberts