##lex200.jpg --Right##ARE Lexus and Volvo the new BMW and Mercedes-Benz? When I posed the question in the office, colleagues thought I'd finally completed my journey to the madhouse. But look at the facts.

In our first long term test report on our reliable Lexus IS200 SE I compared the superbly specced ú19,995 on-the-road car with rivals from BMW (318i SE costing ú20,130), Mercedes-Benz (C180 Classic costing ú20,675) and Volvo (S60 2.0 T ú19,995) and concluded that on power, spec, performance, economy and CO2 the Volvo was the chief rival to the Lexus.

That I'm sure came as a surprise to most fleet managers and company car drivers who have traditionally viewed the executive sector of the marketplace on badge power rather than on wholelife costs, value for money and benefit-in-kind tax.

However, with fuel prices continuing to escalate, the Government pledged to ensure that company car drivers who receive 'free' fuel for private use are fully taxed for the privilege and the new benefit-in-kind tax firmly focusing minds on carbon dioxide emissions levels and list price, such an outdated view must, at last, change.

Lexus is aware that its CO2 figures are not the best - our test car is rated at 229g/km against 188 for the BMW and 220 for the Volvo - however, with its reduced list price and standard specification which is top drawer, the Japanese manufacturer argues that 'low' list prices and high trim levels will offset potentially higher CO2-based tax bills under the new 2002 system.

That is a fair point for Lexus to hold and it is one that both fleet managers and company car drivers would be well advised to look at in detail. To obtain a similarly specced and performing BMW or Mercedes-Benz would cost a heck of a lot more than ú19,995 on-the-road - perhaps ú24,175 for the Mercedes-Benz C200 Kompressor Elegance and ú22,370 for the BMW 320i SE.

In the value-for-money stakes, the Lexus or the Volvo looks good; while on the residual value front, figures from CAP Motor Research's Monitor reveal that the cash 'lost' over three years/60,000 miles is hardly worth the worry.

Our test car is predicted to retain 41% of its value over the term (ú8,950). However, more importantly is the cash 'lost' figure which is ú11,045 - within ú100 of both the BMW and Volvo and ú200 of the cheaper Mercedes-Benz.

Faults, rattles or bits falling off - not a bit of it. In fact the Lexus is boring in its reliability. Surely a boon to every fleet manager and company car driver!

Ashley Martin