About five or six years ago, Toyota - brilliantly, it must be said - introduced a new type of luxury car, the Lexus LS400. Admittedly, it borrowed heavily from Mercedes-Benz and BMW, and in some aspects its conservative styling made it almost a direct clone. Bits of BMW here, shades of Mercedes there, the odd three-quarter aspect which looked like them both. But it set new standards, notably in its reduction of noise and harshness, its wind-cheating ability for such a big car and its wonderful, concert-hall audio system. In short, the LS400 was an instant success, both in the Far East and in the United States. It undercut Mercedes by a considerable amount in both markets, although it was less of a hit - for reasons not totally explained - in Britain, where it sold in meagre numbers despite a heavy advertising campaign. But then Toyota - buoyed by its overwhelming success at home and abroad - committed the cardinal sin. It introduced a down-market, three-litre, luxury saloon with the tag, ES300. Some critics dubbed it an 'over-priced Camry', Toyota's run-of-the-mill three-litre saloon. While the ES300 sold in reasonable numbers, despite the lack of any significant marketing campaign, it was a shadow of the original Lexus. The plot has now taken a turn for the better, though, with the recent launch of a second-generation ES300, a thoroughly revamped version of the original car which definitely lives up to the Lexus name. The latest car is beautifully crafted, but its styling is far more balanced than its predecessor. The addition of the optional moonroof seems somehow to create an air of airiness. It is rare that an engineering update brings about such a transformation in a car. An added benefit of the redesign has been the reduction of drag, the new Lexus commanding a drag coefficient - an industry best in its class - of only 0.29. This compares with the new tiny MGF sports car which comes in at 0.35, the Mercedes SLK at 0.36 while the sleek BMW 3-series coupe rates only 0.30. The result of this is reduced wind noise and fuel economy. Noise reduction was also one of the major briefs for Toyota's engineers and additional vibration damping panels and improved materials inside the Lexus have produced a car almost on a par with its elder brother, the LS400. The sound system, too, is virtually as good, with seven speakers and an in-dash CD autochanger. Significantly, Toyota claims overall vehicle weight has not suffered despite the extra soundproofing measures, thanks to lightweight materials and careful design procedures. The new Lexus has adopted Toyota's excellent, electronically-controlled automatic transmission which momentarily reduces engine torque during gear shifts to prevent what has become known as 'shift-shock'. Effectively, gear changes are almost seamless. The heart of the new Lexus is still the well-proven three-litre V6, with 24 valves and four camshafts. Developing 200 PS maximum power, with a 290 Nm torque figure, the ES300 is eminently driveable. No top speed is quoted by Toyota, but its power to weight ratio suggests in excess of 210 km/h. The LS400 tops 225 km/h. The interior is pure Lexus, with its sumptuous leather upholstery, while the front seats are power operated with a full memory as are the driver's mirrors and headrests. A major step forward by local agent Crown Motors - part of the giant Inchcape group, the world's largest independent distributor of passenger cars - is the five-year warranty, the first such extended warranty of its kind in the world. Priced at $474,950, a small increase on the earlier model, the ES300 will surely find a ready market in Hong Kong and is now worthy of the Lexus name.