The last-generation 5-Series served with profit-producing distinction for BMW from 1997 to 2003, so when the all-new 2004 model arrived, expectations were high. It delivered. There were some criticisms -- the mildly peculiar styling, the anti-intuitive "iDrive" joystick controller that made simple functions such as changing radio stations a multistep process -- but overall, the car has been a success.

For 2008, it was time for an update, and as these midcycle makeovers go, this one is moderately extensive. We have new front and rear styling -- inarguably an improvement at both ends -- a revised interior, a couple of new engines, and a substantial number of mostly unseen tweaks and general refinements that make the 2008 5-Series a genuine improvement over the 2007.

For '08, BMW has replaced the 525i and 530i with the 528i and 535i. The 550i remains. Though the United States still doesn't get the diesel engines that power half the 5-Series models in Europe -- we should get at least one BMW diesel-powered model next year, though -- the 5-Series does get a neat 300-horsepower, twin-turbocharged 3.0-liter six-cylinder from the 335i. That engine goes in the 535i; the 528i gets a 3.0-liter six-cylinder without turbos, meaning it's the lowest-powered 5-Series at 230 horsepower. That's certainly better than the 2004 525i, which had just 184 horsepower.

You can get the 528i and 535i as sedans or wagons. All-wheel-drive versions of the 528i and 535i sedans, and the 535i wagon, are also available -- those would be the 528xi and 535xi.

The 528i's revised inline-six-cylinder engine has 230 horsepower, 15 more than 2007. The 550i engine is a 4.8-liter V-8 with 360 horsepower, the same as last year.

I've driven a couple of 2008 5-Series models, but I spent most of my time in a 550i with a six-speed manual transmission. The 550i comes only as a rear-wheel-drive sedan; no all-wheel-drive or wagon version is offered. As nice as BMW's twin-turbo six-cylinder is, this V-8 is profoundly satisfying, with a wonderful exhaust note under acceleration that sounds as though it should come from an American muscle car.

The biggest surprise with the 550i is one of those unseen improvements: Gone is the grabby clutch that made it difficult to execute a smooth standing start -- finally, the clutch and transmission feel exactly right. For those who prefer not to shift for themselves, a six-speed automatic transmission is offered for the same price. This may be the first time I've preferred the manual over the automatic on the 5-Series.

Since this is a 2008 model, its window sticker uses the new EPA mileage rating system, which better reflects real-world driving. The test car was EPA rated at 15 mpg city, 22 mpg on the highway. This same engine and transmission was rated at 17 mpg city, 24 mpg highway in 2007. Premium gas is preferred.

Inside, the 5-Series cockpit feels familiar, but compared side-by-side with a 2007 model, there have been some substantial changes. Remaining is the iDrive, which uses a cookie-sized joystick located in the center console to control multiple functions. Critics, me included, have hammered BMW over the iDrive, but this one does seem a little easier to navigate than previous versions. BMW has added more and more conventional controls to the climate and sound systems that eliminate having to deal with iDrive.

Seats are typically German -- firm, with good lumbar support -- designed for effortless cruising. Rear-seat room is more than adequate for two adults, passable for three.

On the road, the 5-Series feels pretty much as it did last year, which is not surprising since there wasn't much updating done, or needed, on the suspension. BMW, better than any manufacturer, manages to blend crisp handling with a smooth ride, and the 550i is no exception. If I had to hop in a new car and drive cross-country tomorrow, the 5-Series would be on the short list of preferred vehicles.

As you would expect, even the least expensive 5-Series model (which happens to be the 528i, starting at $44,300) comes with plenty of safety equipment, including stability control, traction control, active cruise control (it uses radar to maintain a safe distance from the vehicle in front of you), rain-sensing wipers, adaptive brake lights (the more "urgent" the braking, the larger and brighter the brake light area becomes), antilock brakes and even "brake drying," which senses when the brakes get wet, and applies just enough pressure to dry them off.

The 550i test car represented the upper end of the lineup, with a base price of $58,500. The tester had quite a few options on top of that, including a cold weather package ($750) that added heated seats, steering wheel and headlight washers; a $4,600 sport package that gets you upgraded wheels and tires, a stiffer suspension, a sport steering wheel, an active suspension, some body trim and several other features; a navigation system ($1,900), an upgraded stereo ($1,200) and several other features than brought the price, with shipping, to $69,820. Feature for feature, that's pretty close to 2007 prices -- which is not to suggest that it's cheap.

The 550i isn't, however, the most expensive or most powerful 5-Series model -- that distinction goes to the M5, which has a 5.0-liter, 500-horsepower V-10 engine. The 2008 M5 starts at $82,900, but save some money for gasoline, as mileage is EPA-rated at 11 mpg city driving, 17 mpg highway, making it thirsty enough to get socked with a $3,000 federal "gas-guzzler" tax.

Clearly BMW is working hard to maintain the 5-Series as the template for the mid-sized premium category, but it's facing its toughest competition ever. The new 2008 Cadillac CTS is a strong contender, as are the Infiniti M, Mercedes-Benz E-Class, Lexus GS, Acura TL and Audi A6. Sources within BMW wonder if the freshening for the 2008 model went far enough -- some within the company would have liked to see more dramatic exterior changes because, after all, this model needs to carry the 5-Series for at least three more years before an all-new model is ready.

In the first six months of 2007, BMW sold 23,807 copies of the 5-Series, down about 4,000 from the same period in 2006. With the 2008 models just now reaching the market, we'll see soon enough how the customers feel about the makeover.