The Mercedes technical director, James Allison, believes his team and their new car are up to the “climbing Everest” challenge of catching Red Bull in the Formula One championship this season, and on Thursday the 55-year-old concluded a long-term contract extension.

The announcement of the hugely experienced Allison’s contract is crucial as the team attempt to return to the front of the grid and also look towards the new set of technical regulations to be employed in 2026, which Allison will direct at Mercedes.

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Allison took the job in 2017 and was in charge as Mercedes continued their run of remarkable success, overseeing four drivers’ titles and five constructors’ championships.

With their car badly off the pace of Red Bull for the past two seasons and having opted to pursue an entirely new design philosophy for this season, Allison conceded the task ahead was daunting but emphasised that he and the team were optimistic about taking the fight to their rivals in 2024.

“Climbing Everest is an apt comparison,” he said. “It’s the sternest of challenges, but it is nevertheless possible to do so and that is how we are taking this. We are a challenger rather than a favourite, but nonetheless we hope we have done a good job with the new car and addressed some of the shortcomings that were so publicly on display with it last year.”

Allison also noted that he believed the current generation of cars had a finite lap time in them and that while Red Bull were far ahead last year, their gains would likely be smaller this season and there would be a convergence as the other teams caught up. He said that if Mercedes could make it to the fight they would be ready to step up.

“In addition to us having worked well [on the new car] my guess is it is going to be relatively busier near the top of the grid this time round,” he said. “If we are good enough to be in that fight, well, then operational things, driver excellence, the skill of the crew, all of those things become differentiating factors.”

He also observed, with regard to drivers, that there was absolute confidence at Mercedes that the seven-time champion Lewis Hamilton was more than ready to battle for the title if the team gave him the tools to do so.

“There is no doubt about Lewis’s motivation to get back to winning ways,” he said. “But whether or not he can do that is much more in the equipment we give than in his own hands, he has always had that ability there.”

Toto Wolff, whose contract extension as team principal for three years was confirmed on Monday, welcomed the news of Allison’s new deal and the stability it ensured.

“Since joining in 2017, he has been a key ally and sparring partner for me personally,” Wolff said. “We can challenge each other openly and honestly; an embodiment of the ‘tough love’ culture of the team that is vital in helping us all perform at our very best.”

Mercedes will unveil their new car, the W15, on 15 February at Silverstone and the first race of the season is in Bahrain on 2 March.