That makes the 545i easily the swiftest new Five until the V10-engined M5 arrives in late '04. It's said to be good for 0-60mph in just 5.8sec (less than a second behind the old 400bhp V8 M5), and romps on to a limited 155mph, in fifth or sixth gear. That's with the manual gearbox which, unusually in this class, comes as standard.

Very M5 in proposition, but when you add the auto, as most buyers surely will, the price rises from ΂£41,555 to a fraction under ΂£43K. That's about the same as a Mercedes E500 and ΂£7K more than a Jaguar S-Type 4.2 (neither of which offer a manual option, incidentally). Add the cost of Active Steering (΂£880) and Dynamic Drive (΂£1550) and you're up to ΂£45K. Yet externally the 545i looks just like a ΂£25K 520i apart from 17in, ten-spoke alloys shod with a 225/50 tyres.

You'll have your own thoughts on BMW's new-wave styling but love 'em or hate 'em, you can't ignore them. For me, the shock has worn off and suddenly a lot of other cars are starting to look dated and staid. By the time the new 3-Series arrives I reckon we'll all be as comfortable as we're going to be with Chris Bangle's 'flame surface' styling, which is pretty clever considering it's the 3-Series that BMW relies on to sell big numbers. That doesn't mean I love the 5-Series, though.

For me, its cockpit styling is more successful. It's bold yet tasteful, and I can just about get on with the simplified iDrive multi-function controller too, but I don't understand why, in a driver's car, there's a near-useless instant mpg swingometer where the water temperature gauge should be. The driving position is perfect, though, and the seats - the 'comfort' option on this car - are both comfy and supportive.
The 328bhp V8 is a rather shy thing. It's very smooth but there's hardly any woofle or rumble to be heard at idle or on a light throttle. The 645i has essentially the same drivetrain but, curiously, in the 545i the V8 feels less responsive at low revs and the action of the manual lever seems more long-winded and knuckly. It takes quite a few miles to finesse the shift and, even when you have, the lower ratios feel very long for a six-speeder.

Active Steering is instantly noticeable, which is gratifying if you've paid almost ΂£1000 for it, but surely its transition should be so subtle that it doesn't draw attention to itself. After a few hundred miles it starts to blend into the background of a well-sorted dynamic picture but it can still surprise you in low-speed manoeuvring, when the steering ratio is at its most go-kart-like.

At speed the system slows down the response at the rack compared with your input at the wheel, which helps maintain stability, a commodity the 5-Series has in abundance, partly thanks to Dynamic Drive. This optional system works the anti-roll bars to limit roll to almost zero in cornering but frees them up in a straight-line so that the ride isn't compromised by single-wheel bumps, such as you might encounter on roads with undulating or pot-holed edges.

The ride of the 545i is generally good but it simply can't cope with small, rapid-fire undulations. It becomes disappointingly agitated on any such surface up to 50 or 60mph, which may well be down to its run-flat tyres with their very stiff sidewalls.

To fully appreciate the 545i, you've got to take it by the scruff. Extend its V8 and it comes alive, with a real shove at around 4000rpm, and Dynamic Drive really does deliver strong, flat cornering. There's certainly more grip than you'd credit the 225s with, but at the end of the day the new 545i is no M5 substitute.

It's a potent, capable saloon but it's not inspiring. There's too much suspension- mounting compliance to accurately relay what's happening at the tyres, while the obvious benefits of Active Steering seem to come with the downside of reduced steering feedback.

So while it's a fine mid-range saloon, the 545i doesn't engage its driver as well as it might, or indeed as well as a rapid BMW should. Its lack of pure edge suggests it would be better served by an auto box, which would more effortlessly whip-up the V8 for those occasions when you want to press on, and although the Beemer rarely puts a wheel wrong, the 4.2-litre Jaguar S-Type has a superior ride and handling balance. We look forward to seeing what BMW has made of the up-coming V10-engined M5.