Mercedes ended weeks of speculation on Monday when it announced that Hamilton would be staying for another season with the F1 team.
But the fact that the German car manufacturer and Hamilton only agreed to a single-season contract prompted some surprise, and fuelled talk that 2021 could be the British driver’s last season in F1.
Speaking to media on Monday, Wolff explained the background to the contract length – and made clear that there was a desire from both of them to delay lengthier discussions regarding 2022 and beyond until the season got going.
Wolff said that complications caused by both of them catching coronavirus, which derailed hope of talks taking place towards the end of last season, forced a change of plan.
“We jointly agreed on a one-year deal,” said Wolff. “First of all, there is a substantial regulation change in 2022. We also want to see how the world develops, and the company. Plus on the other side, it's because we kept it very late.
“We wanted to discuss the contract at the end of the season between the Bahrain races and then obviously, Lewis didn't feel well. And in the end, we started our conversation, just before Christmas.
“So it was important to get it done as soon as possible. And in that respect, we thought, let's postpone the discussion about 2022 and onwards to a later stage in 2021.”
Wolff said that the ongoing uncertainties about the impact of coronavirus on F1, and especially in relation to team budgets, meant that it was difficult to make certain commitments now about a longer term contract.
That is why he feels contract talks next summer regarding 2022 and beyond will be much clearer – and will allow time for proper discussion.
“There are uncertainties in the world that affect the way that the sport can operate, that have an influence on our revenue, TV monies, and on sponsorship income.
“Daimler, Mercedes, is in a huge transformation towards electric mobility and that means investments. So we are living in a financial reality that is very different to what it was a few years ago.
“But having said that, we are totally inline, Lewis and me and the wider group at Mercedes about the situation. So there was never any discrepancy in opinion.
“It was just that we felt we could get a good signature on the 2021 contract because we just need to get going and then find some time during 2021, earlier than this time around, to discuss the future.
“And it's not only specifically to 2022, but also beyond. And that is not something that we wanted to carve out via videoconferencing between Christmas and the end of January."
Wolff also rubbished any talk of Hamilton demanding a driver veto in his contract to avoid being partnered with another superstar driver like Max Verstappen.
He also said that suggestions pay talks had hit a sticking point over a potential revenue share of Mercedes incomes were totally made up.
“On the specific clauses that were out there in the media, I don't know where they came from because none of that is true,” he said.
“I actually read about this, and I found it interesting, but the truth is that there was not one second of discussion about any driver specific clause. He has never asked for that in the last eight years. And it's a team decision.
“And the other clause about a revenue share. That came out of nowhere. That rumour was baseless, too. So none of that was ever part of our discussions.”