I tested out the S mode all day today and don't feel too much difference from a C mode. It tends to hold gears slightly higher and bit more responsive. I think that it should be in S mode all the time.
I have an automatic 2010 C250 CGI Australian Spec with AMG kit, Advanced Agility package and Vision package. I admit I would like the option to select sport without the damper function. The sport mode allows the car to start in 1st gear instead of 2nd as well as changing the shift patterns and is handy in stop/start traffic as well as some fun driving. I can only have sport by selecting the stiffer damper setting. There are a few of these types of defaults that I find frustrating (including lights, wipers etc) and I would like some options to change them to suit my style better. Access to the setup menus would be nice.
If you got a RWD car, than C mode VS S mode will actually make a difference in bad weather. With a 4MATIC with 4ETS I figure the V6 W204 (230/250/300/350) just don't make enough power to make any difference in stability between C and S modes. When I had the W210 E320, taking off from dead stop in C mode was much easier in slippery conditions. With the W204 C2304M I got now - C or S, I can accelerate the same in slippery conditions in C or S, so I figure I'll have a bit more fun with it and also make the tranny use all 7 gears that it got.
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