The BMW X5 is a seemingly unstoppable force in luxury-SUV sales.

More than 1.1 million have been sold since the German car maker’s first ‘soft-roader’ went on sale in 1999, and its movement out of showrooms in Australia reflects its global popularity.

It’s currently still the best-selling luxury SUV locally, and the BMW X5 still out-sells its smaller and more affordable siblings – the BMW X3 and BMW X1.

A third-generation BMW X5 is due in 2013, however, and the current model (released in 2006 but updated in 2010) faces a major new threat from the brand-spanking-new Mercedes-Benz ML that launched in April.

And the German brand from Stuttgart has continued an aggressive pricing strategy for its models that has placed pressure on its compatriot brand from Munich.

With the Mercedes-Benz ML starting at $81,400 – a whopping $10,700 less than an entry-level X5 – BMW Australia has been forced to respond.

That counter-attack comes in the form of an Innovations Package that was previously a $9000 option – and worth $16,000, according to BMW – but is now standard.

It’s more of an Aladdin’s crevice than cave in terms of treasures, but most of the eight extra features for the BMW X5 xDrive30d we tested are highly desirable.

There’s a tailgate that opens and closes at the touch of a button, a head-up display that projects a digital speedo onto the windscreen, full (rather than partial) electric driver’s seat adjustment, satellite navigation and reverse-view camera with ‘Top View’, which provides a handy birds-eye surround view of the vehicle.

Other additions include bi-xenon headlights, anti-dazzle side mirrors and high-beam assist.

Driveaway pricing still breaks the $100,000 barrier, though, and it’s disappointing buyers still have to pay another $2000 for metallic paint.

Notable standard features for the base BMW X5 – the biggest seller in the range –  include dual-zone automatic climate control, rain-sensing wipers, multi-function steering wheel, leather seats, electrically adjustable and heated side mirrors, cruise control with braking function, parking guidance, 18-inch alloy wheels, Bluetooth connectivity, 6.5-inch colour information display, dual front airbags, side and head airbags up front and head airbags for the rear seats.

Vehicle stability control is joined by hill descent control and traction control among other electronic safety features.

The BMW X5 30d engine bay is filled with a 3.0-litre six-cylinder that offers maximum power of 180kW at 4000rpm and peak torque of 540Nm between 1750 and 3000rpm.

An eight-speed automatic gearbox provides plenty of ratios for ensuring the diesel stays in its operational sweet spot.

Those shifts are both quick and smooth, complementing an engine that is responsive from down low and with a sufficiently broad spread of power.

While Germans might prefer the noticeably quicker BMW X5 40d for their speed-unlimited autobahns, the 30d’s performance will be ample for most Australians.

A BMW-quoted 7.6 seconds for the 0-100km/h sprint is none-too-shabby for a vehicle that weighs 2075kg.

It feels unusual nowadays, though, to jump into a high-end German car that doesn’t feature engine stop-start technology.

In terms of official combined fuel consumption, however, the BMW X5 30d is only a fraction behind the comparable (new) Mercedes-Benz ML350 CDI – 7.4L/100km v 7.3L/100km – and ahead of the Audi Q7 3.0TDI’s 7.8/100km.

Lexus doesn’t offer a diesel version of its RX SUV, but it’s hybrid RX450h model sets the efficiency benchmark in the segment with 6.3L/100km.

High-riding SUVs that can be described as great to drive are in an elite group, but the BMW X5 remains a major member.

The steering weighting is perfectly judged and linear from lock to lock, and turning the wheel in corners is a rewarding experience for the driver as the X5 impresses with its poise.

The grip of the standard 18-inch tyres do have earlier limits than bigger tyres, though they also provide a quieter, more comfortable ride.

A slightly longer seat cushion and some extra bolstering wouldn’t go amiss up front, though otherwise the X5 offers comfortable pews.

Rear-seat passengers will have few complaints, too. Whether you’re looking for room for knees, heads or feet, space is generous. The floor is also virtually flat and there’s decent width to the cabin, so it is feasible to fit three adults up back, even if they’ll be rubbing shoulders.

Central vents ensure a decent amount of air is pumped to the rear, and deep door pockets and seatback map pockets provide storage options.

Drop the rear seats – manually alas as no electric release levers – and the 620-litre boot space expands into a 1750-litre overall capacity, and the floor isn’t as flat as it could be. The rear seats don’t slide fore/aft, either, so owners can choose whether they want more boot space or more legroom.

Thanks to that aforementioned equipment upgrade, the tailgate of the BMW X5 30d now opens and closes automatically at the press of a button (either on the dash, key fob or tailgate itself). It was a $1300 option previously.

It’s also split into two sections, with the bottom half presenting a pseudo bench/table a la Range Rover.

The boot is wide and deep even when the rear seats are in use, and there are cargo rails with tie-downs, elastic straps either side for holding items, a 12V socket, and there’s a cargo blind to keep boot contents secretive.

The boot floor lifts up hydraulically to reveal a temporary size spare wheel and an extra plastic built-in tub that would be handy for storing wet items.

Alternatively, buyers can opt for third-row seating that lifts out of the boot floor – giving the BMW X5 a passenger-capacity advantage over the rival Mercedes-Benz ML and Lexus RX.

Storage isn’t a BMW forte though there are no issues in the X5. There’s a good-sized, split-lid console bin, a deep glovebox (also accessed by a split opening), large door bins, and double cupholders.

And although the current BMW X5 is in the twilight of its current lifecycle, the interior overall has aged well in terms of materials quality and presentation thanks to the 2010 update. It’s certainly looking fresher than the rival Audi Q7 that is also due for replacement in the not-too-distant future, though Audi remains the king of cabins among the German luxury-brand triumvirate.

The BMW X5 remains a large luxury SUV to strongly consider, though the Mercedes-Benz ML has also never been a tougher adversary in terms of pricing, performance and the way it drives as it is with the latest generation. And if you’re more serious about off-roading, a Land Rover Discovery 4 is a better option.

Click to read a review of the BMW X5 40d.

Click to read a review of the BMW X5 M.