The entry-level luxury sedan market accounts for nearly 40 percent of all luxury-car sales in the United States, growing rapidly from 25 percent just a few years ago. Characteristically, Chrysler, Lincoln and Cadillac have been lethargically slow to react to shifting luxury-car buyer tastes, while Lexus, Infiniti, Audi and BMW have been actively wooing these customers with fun-to-drive, lavishly appointed sedans and outstanding customer service. While companies from across either pond brought the ES300, 328i and A4 to market, the Big Three produced the Eldorado, Continental and New Yorker during the same time period.

Cadillac was the first domestic luxury automaker to attack the entry-level market head-on with the introduction of the 1997 Catera. A year later, the Catera is still the only American near-luxury model available. Based on the European-market Opel Omega MV6, the Catera features a 200-horsepower 3.0-liter DOHC V6 engine mated to a four-speed automatic transmission and rear-wheel drive. Built in Russelsheim, Germany, the Catera is touted by Cadillac as a blend of the best of German and American engineering. It features antilock brakes engineered for the German Autobahn, dual front airbags, traction control and an engine-disabling theft-deterrent system.

With prices starting near $30,000, the Catera qualifies as a bona-fide bargain in this segment. Options are restricted to a power sunroof, power rear sunshade, heated front and rear seats, a Bose audio system and chrome-plated aluminum wheels. Standard equipment includes power windows with express-down features for all four windows, remote keyless entry, heated windshield washer nozzles and an automatic dual-zone climate control system. Two models are available: a base model and one appointed with leather.

The Catera also benefits from a roomy interior and is classified a midsize car by the EPA. The dash layout is outstanding, providing large, analog gauges and easy-to-use controls. Wood trimming is kept to a tasteful minimum, and the Catera exudes a level of interior luxury uncommon for the class.

But, what about performance? The Catera holds its own, but we suspect there will be sales lost to the BMW 328i, Nissan Maxima and Audi A4 due to the lack of a manual transmission. Cadillac also opted to limit the Catera's top speed to 125 mph so they could fit all-season rubber to the standard aluminum wheels. The result is a smoother, softer ride on America's often harsh pavement, and better wet-weather grip, at the expense of dry-weather handling.

Still, the Catera is a fine effort from Cadillac, priced competitively and offering all the luxury and most of the performance a buyer could want from this segment. All it really needs is some more low-end punch and an optional manual transmission.