Behind closed doors at Mercedes-Benz's tech-filled Silicon Valley R&D facility

If you gather a room's worth of automotive historians together and ask them who made the first car, you will surely stir up some spirited debate. But, once it settles down a bit, the majority will nod and point toward Dr. Karl Benz's 1886 Patent-Motorwagen. It only had three wheels and not a single USB port but is generally considered the first vehicle designed from the ground up to be powered by a non-equine engine. You could call it Victorian-era forward thinking.

Automotive progressivism is a rather different thing today. Spend a few months investigating the wrong alternative power train or saddle your car with last year's iPhone connector and you might as well just tell your dealers to pack in and go home. Car buyers are savvier than ever, and while there are few international brands more decidedly Germanic than Mercedes-Benz, its many designers and engineers are well aware that a global perspective is required to stay globally competitive.

Touring the Mercedes-Benz Sunnyvale R&D center (pictures)

+21 More

See all photos

And that's why, for nearly 20 years now, Mercedes-Benz has had a strong presence in the heart of Silicon Valley. It's now stronger than ever, with the opening of a shiny and new R&D facility that's bigger and more-high tech than before. We were lucky enough to be let inside for a tour of the place to see some of the work that comes out of the studio.

The Sunnyvale, Calif., building is a few miles from the headquarters of Nvidia, supplier of the chipsets driving MB's more advanced infotainment systems. Tesla, a partner for many of MB's electrification programs, stamps out the Model S about 20 miles away in Fremont, and all around are startups large and small. Nest, the smart-thermostat maker just next door in Palo Alto, is one new company that the Mercedes engineers seem particularly enamored of. Every single room inside the sprawling Mercedes offices has at least one thermostat. That's 114 in total.

These aren't just high-tech decor. In fact, multiple Mercedes reps suggested that serious integration between future cars and the thermostats is coming. We got "a little teaser" of that sort of integration from a mockup of the interior to be found in the next-generation S-Class. Set your destination as your ski cabin in the woods and your car will call ahead to your Nest, ensuring the lodge is nice and cozy when you arrive.

That sounds a little far-out, but there's plenty more, including an NFC-like sensor applied to a set of skis. Slap the sticks on the roof and the car will automatically suggest your favorite slope-side destinations. This, too, is a somewhat fanciful demonstration, serving as more of an indicator of the sort of predictive behavior MB is trying to bring to its cars. Nobody likes programming a nav system, so having a car that's capable of figuring out your destination is a very good thing.

That includes a prototype app for Google Glass. Mercedes' engineers are keenly aware that the augmented-reality display has famously had some run-ins with the law. With the prototype app, you can use Glass to get directions to a destination as per usual. Then, when you sit in the car and plug in your phone, the car pulls down the destination and takes over routing, so that you can take off Glass. After you park, just unplug your phone again and Glass picks up the rest of the trip. It's a seamless hand-off.

This, we're told, is a long way from release, but some Pebble smartwatch integration looks a lot closer to reality. This too works both in the car and outside of it. While driving, the watch buzzes to alert you to problems in the road ahead. Step out of the car and the app can tell you where you parked and even give you service information, like the current tire pressures. We were even shown a concept of how you could unlock your car from your watch -- though it was described as being a long way from readiness.

Other demos included in-car functionality for viewing flight information and traffic cameras, car-to-car communication that will alert you where and when another car has pulled over, and even a smartphone app that lets passengers in the back seat change the car's radio station. No more uncomfortable conversations with your driver, just change away.

Mercedes has formed partnerships with more than 50 startups in the Valley, a process that Prof. Herbert Kohler, vice president of group research and sustainability at Mercedes-Benz, says is vital to the ongoing success of the brand. "Nobody can predict the future, but you can try to define the future." Indeed, that's what the company has been doing there, since crafting its first Internet-enabled car way back in 1997. "The transfer rate was not comparable to what we can do today," Kohler admits. "But it was always our commitment to the valley."

Eric Larsen, research director at the facility, said that the presence in California provides incredible insight into a market that is globally unique. In major countries elsewhere in the world, the population and demographics are aging. In the US, we're getting younger. He also references "mega suburbs" as a distinctly American thing, a less densely populated and more car-friendly alternative to the mega cities elsewhere in the world. Finally, thanks to what he calls the "fracking revolution," overall relative energy cost is actually declining in the US. Elsewhere, it's climbing.

While much of the core engineering of Mercedes-Benz still happens in Germany and at centers elsewhere around the world, the 300 (and counting) employees in Sunnyvale have their own conceptualization of app and infotainment design, and they're building out their development team to speed up implementation, too. Soon there'll be a bit of the Valley inside every Benz.