Williams initially joined forces with the Stuttgart manufacturer in 2014, at the start of the hybrid era, with a seven-year deal that took it to the end of the current Concorde Agreement.
The new deal extends five years into the post-2021 era, and as such is a clear show of faith in the future direction of the sport from both parties. Williams will continue to make its own gearbox rather than join Racing Point in taking a supply from Mercedes.
Williams has always enjoyed a good relationship with its current supplier, in part because Mercedes boss Toto Wolff was previously a shareholder in and director of the Grove team.
That was reflected in the way the Brackley outfit was able to conclude a deal to take Valtteri Bottas after Nico Rosberg’s sudden retirement at the end of 2016.
“We have enjoyed a wonderful partnership with Mercedes-Benz over the past six years of what was originally a seven-year agreement, and so we are delighted to be continuing working with them for a further five years from 2021,” said deputy team principal Claire Williams.
“Mercedes-Benz has been one of the sport's most successful engine suppliers and we believe that they will continue to have an extremely competitive engine package going forwards. Over our time with them they have become a real friend of the team, and we look forward to working with Mercedes-AMG HPP in future.”
“Williams is one of the iconic brands in F1 and we at Mercedes are proud to count them as part of our motorsport family,” said Wolff. “They have been through some tough times recently but that has only served to demonstrate their resilience and strength of character as they battle back to where they belong on the grid.
“I am certain that the outlook for independent teams is bright under the financial regulations that will be introduced from 2021 and we are delighted to continue our partnership with Williams into that new era of our sport.”
Mercedes HPP engine chief Andy Cowell noted: “Williams has been an exemplary partner since we began working together ahead of the 2014 season and we have enjoyed a number of highlights during those years.
“We have built strong human and technical relationships to the team in Grove and very much look forward to building on them in the years ahead.”