After a slow start, hi-tech hybrids are attracting mainstream success. And it’s not just penny-pinching family cars that are getting the eco-friendly electric treatment.

The newest generation of luxury limousines has also been given a green makeover. The latest arrival is the Mercedes S300 Hybrid, which combines a small-capacity four-cylinder diesel with an electric motor to deliver a compelling blend of performance and economy. But are captains of industry going to be convinced by such a humble powerplant, or are they likely to be swayed by a theoretically smoother and more refined petrol unit?

To find out, we’ve lined up the new S-Class against a pioneer of the luxury hybrid class: the Lexus LS 600h. Boasting a strong and silent 5.0-litre V8 and muscular 221bhp electric motor, the innovative car has the Mercedes beaten hands down for performance, plus it comes lavishly equipped and is backed by a decade of petrol-electric know-how.

• Mercedes S-Class review

• Lexus LS review

So which of our fuel-saving flagships takes victory in this classy encounter? Click on the links above to read the in-depth review of each car, then scroll down for our verdict.

Head-to-head

Engines

Despite sharing similar hybrid principles and performance on the road, the Mercedes and Lexus are very different under the skin.

The LS’s petrol engine has over twice the capacity of the diesel S-Class. Plus, its electric motor alone produces 221bhp – almost as much as the S300’s total output. And while the Lexus delivers its power to all four wheels through a CVT gearbox, the Mercedes uses a seven-speed auto and is rear drive.

Comfort

The LS 600h’s reclining seat, four-zone climate control and powered blinds are all fitted as standard; you’ll have to pay £4,000 to get the same kit on the S-Class.

Although both models feature a long wheelbase, our tape measure revealed that the Lexus had an extra 90mm of rear legroom.

Business users

If you plan on purchasing one of these cars for business use, the Mercedes is a no-brainer. A higher-rate earner will pay £7,018 a year tax to run an S300 specced to the same level as the Lexus – that’s still £5,714 less than for the LS 600h.

Verdict

1st place: Mercedes S300

The brilliantly engineered S-Class can comfortably lay claim to the title of ‘best car in the world’. Its diesel-electric hybrid system isn’t as well integrated as the Lexus’ petrol unit, plus it’s a little thirsty, but it’s remarkably refined and delivers surprisingly strong performance.

2nd place: Lexus LS 600h

There's lots to like about the LS 600h – its hybrid system is very effective, there’s loads of standard kit and it’s comfortable. But the price tag is hard to ignore, and the Lexus doesn’t feel composed on the road. It also lacks the bespoke quality of the best limousines.

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