Daimler is lining up Euro 400 million (£344.6m) in backing from the European Investment Bank (EIB) for a research and development programme to develop new electric and hybrid vehicles.

The German carmaker is planning to spend Euro 1.7 billion on creating new battery and fuel cell cars, and new electric power engine trains, including batteries for hybrids (and plug-in hybrids) with an extended driving range.

The EIB is formally considering making a loan covering just under 25% of costs.

A memorandum said: “The project is a prerequisite for the implementation of the promoter’s roadmap towards vehicles with lower carbon emissions.”

Daimler would use existing in-house facilities for the research.