BMW has good reason to expect a revival of 5 Series diesel sales with the introduction of the new 520d – a four-cylinder variant that comes in a remarkable $35,000 under the only other variant, the six-cylinder 530d.

As well as being much cheaper, it is of course also much more economical and, although it lacks the 530d’s impressive off-line acceleration, overall performance of the 520d is hardly lacking as it reaches 100km/h from rest in a useful 8.6 seconds.

That might be 1.5 seconds slower than its bigger sibling, but it is a full second faster than the recently released X3 2.0d, which is powered by the same engine.

The new all-aluminium 2.0-litre common rail turbo-diesel engine is also shared with the little 120d (and soon the compact 320d sedan), developing 125kW of power at 4000rpm and 340Nm of torque from 1750 to 4000rpm, and is nicely mated with BMW’s smooth-shifting Steptronic six-speed automatic transmission.

There is little diesel clatter to be heard inside the 5 Series at idle or low revs, so it should be quiet to drive around town, but it certainly sounds like a diesel from the outside.

Our launch drive on rural and mountain proved the 520d to be capable and refined, offering good overtaking ability and quiet cruising, ticking over at just 2100rpm at 110km/h on the freeway.

We found the engine to be a little coarse in the upper rev range (where you don’t want to be anyway), but it was otherwise very smooth and delivered strong performance for quite a big and heavy car, while returning good economy.

The official combined fuel figure of 6.1L/100km is outstanding and, while our test figure was closer to 8.0L/100km, this included some fairly spirited driving and some heavy climbing.

A nice surprise was the level of ride comfort in the big sedan, the result of having ‘normal’ tyres because run-flats are not available for the 16-inch wheels fitted to the 520d. It is therefore able to absorb bumps better than its more expensive siblings while still offering plenty of grip.

Not even a little floatiness and a higher-than-expected level of noise transfer to the interior from bumps could spoil the overall driving experience with the 520d.

The stability control does a superb job of keeping the car on track without being too intrusive and, although the steering could do with more on-centre feel, it is very well-weighted at speed while still being light for parking.

It is also an extremely comfortable car, with good seats and excellent ergonomics, although the iDrive system – improved as it is with the addition of ‘favourites’ buttons – still infuriates with its unnecessary complexity.

Priced $5000 below the similarly-equipped 523i – and with better performance (half a second faster to 100km/h), two-thirds the fuel use and 10 per cent lower emissions than the petrol-engined model – the 520d makes a strong case for buying a premium diesel-engined sedan.