Mercedes spends £10m A DAY on research and development. Here's how

Prof Dr Thomas Weber is head of R&D at the Daimler group. His department's research and development budget is €5.4bn a year, of which €3bn goes on Mercedes cars. That's the equivalent £2.1billion, or about £10 million every day of the working week. Where on earth does it go?

1. CUTTING CO2

"About half of the budget is in cutting CO2," Weber says. TopGear gasps, so he clarifies that the figure includes all engine development, "to bring engines which have better energy efficiency. Higher power and better consumption."

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For petrol and diesel, it's all about evolution now. "There is no 'next big thing' in engines." Also included in Weber's CO2-cutting spend: "New transmissions but also friction reductions, low-resistance tyres, aerodynamic optimisation, light weight." And on every kind of powertrain: "E-motors, hybridisations, new battery concepts, that's part of this 50 percent too. And we are still committed to fuel cells."

2. ELECTRONICS

"The second biggest part of my budget goes on electronics,” says Weber. “That's connectivity and autonomous driving, and safety and assistance systems. It's rising. It's dangerous to focus only on conventional thinking. Newcomers in this industry are focussing on car sharing, Uber, autonomous driving.

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“We have decided a Mercedes will always carry a steering wheel. It's the symbol of freedom – there will always be times when you want to drive. But in traffic the assistance systems help you to concentrate on the things you really want to do: phone calls, texts, whatever else."

Mercedes is doing the connectivity and apps itself, rather than handing it over to, say, Google. Weber says Mercedes customers want the carmaker to take care of their data, not outsiders. He needs to oversee security and hacking. "For over-the-air flashing to give an engine update or a new feature in the steering, we have to guarantee that if you steer left then the car goes left."

We have decided a Mercedes will always carry a steering wheel...

3. NEW VARIANTS

"Number three in spending, after CO2 and electronics, is new vehicle development." Will Mercedes keep adding to its range? "Yes. I don't know if that's a never-ending story of more and more. Sometimes variants will die. If the fashion changes you have also to change."

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But with a widening range, and more spending on other things, how do they afford to develop each whole car? "With our flexible architecture and module architecture in place, comparable with Lego, we can easily combine different modules. And we can change the overall setup of the vehicle by electronics [instead of different chassis or powertrain hardware]. So the money you need gets smaller for each variant. Also by virtual prototyping, we reduce spending dramatically, even though the result is better, more precise..."