Although estates don’t have many takers in our part of the world, they are still very much in demand in Europe. Even among those buyers, there’s been a growing demand for estates that can do light off-road duties as well, like the Subaru Outback, Audi’s new A6 Allroad and Volvo’s XC70, which has now been replaced by the V90. Now, Mercedes-Benz, which had already revealed its new E-Class estate early last month, is working on an all-wheel drive variant of the mid-size wagon. Although this was confirmed by a senior Merc executive last month, this is the first time we are seeing the car out on the roads.

Spotted by our spy photographer while on a round of testing right outside the German carmaker’s headquarters in Sindelfingen, the estate, which is expected to be called the Mercedes-Benz E-Class All Terrain, shares its overall styling with the regular estate, but the evidently higher ground clearance, wider wheel arches, modified bumpers front and back as well as plastic underbody protection give it away as the all-wheel drive version.

The estate is expected to be equipped with Merc’s Air Body Control variable-height air suspension, allowing drivers to raise the car up from the standard height for mild off-roading duties, and lower it for highway drives. Powertrain choices and other features will not be any different from the ones seen in the E-Class saloon and the regular estate. So, expect the same range of turbocharged four- and six-cylinder engines to power the new model, which is likely to have its debut at the Paris motor show this September.

The smaller C-Class is also expected to follow its bigger brother with its own rugged, all-terrain, soft-roader version, which will go head to head with the likes of Audi A4 Allroad and Volvo’s V60 Cross Country.