In the last racing season before the start of the Second World War, Mercedes-Benz managed to continue the success story from 1938 with the W 154. The first race on the calendar, the Pau Grand Prix, was won by Hermann Lang in a W 154 ahead of Manfred von Brauchitsch, making up for the defeat suffered the previous year. Lang was again the winner in the Eifel event in May, with Caracciola in third place and von Brauchitsch fourth.
Lang went on to extend this impressive winning streak. He took the Höhenstrassen-Rennen (High Road Race) in Vienna in a hillclimb version of the W 154 (with von Brauchitsch in third place), followed by an identical result for the same two drivers in the Belgian Grand Prix at Spa. Caracciola took the German Grand Prix at the Nürburgring - for the fifth time. At the Swiss Grand Prix Lang finished ahead of Caracciola and von Brauchitsch. He also won the German Hillclimb Grand Prix on the Grossglockner, thereby securing the 1939 German Hillclimb title. He was clearly the season's top driver, but with the outbreak of war the authorities responsible, the AIACR in Paris, were unable to award the title of European Champion. Under the regulations at the time the championship should have gone to Hermann Paul Müller of Auto Union, on the basis of good placings in the four championship races, but the national ONS organisation declared Hermann Lang the champion.
A departure from the norm in the series of Mercedes victories in 1939 was the Tripoli Grand Prix. For this race, the 3-litre specification that had been totally dominated by the German racing cars was replaced by a 1.5-litre category (voiturette formula), for which the Stuttgart engineers had no vehicle. This was a ruse by the organisers in Libya - at that time an Italian colony - designed to circumvent the domination of the Silver Arrow cars and to ensure the first victory for an Italian car in the event since 1934. Since that year the race on the Mellaha track had been won by German drivers: Caracciola in 1935, a victory for Auto Union in 1936, and Hermann Lang for Mercedes in 1937 and 1938.
But Mercedes-Benz was not to be eliminated so easily from what was in the 1930s one of the most prestigious Grand Prix events. When the changes to the rules were announced in September 1938, the team in Stuttgart took just eight months to develop a completely new racing car, the W 165. The basic drawings were soon completed by engine specialist Albert Heess and chassis master Max Wagner, and by April 1939 both Caracciola and Lang were testing the first car in Hockenheim. And so, to the amazement of the racing world, the starting line-up for the Gran Premio di Tripoli included two Mercedes-Benz W 165s with the required 1.5-litre displacement.
The new car was based on the current W 154 Grand Prix car, and at first glance appeared to be a scaled-down version of the 3-litre racer. The struts of the oval frame were made of chromium-nickel-molybdenum steel, with the five cross-members supplemented by the rear engine bracket. The driver sat not in the middle, but slightly to the right. With full fuel tanks but without the driver, the W 165 weighed 905 kilograms. The engine, too, even though it weighed just 195 kilograms, was clearly a close relation of the V12 engine in the W 154. It was a V8 engine with displacement of 1493 cc, a V angle of 90 degrees, and with four overhead camshafts and 32 valves, with an almost identical arrangement and drive system to those in the Grand Prix model. The mixture was prepared by two Solex suction carburettors, with powerful support from two Roots blowers. Its output of 187 kW at 8250 rpm equated to an astonishing power per litre of 125 kW. Large brake drums (diameter 360 mm) covered almost the whole of the inside part of the spoked wheels. The designers had even allowed for the extreme temperatures to be expected in this particular host country - where the track baked in temperatures of 52 degrees Celsius on the day of the race - by placing tubular coolers along the fuel line.
The rest is racing history: the two Mercedes-Benz W 165s left their adversaries virtually no chance. Caracciola, in his shorter-ratio vehicle, completed the entire race without a break, while Hermann Lang - in line with Neubauer's carefully planned tactics - made a brief stop to change tyres and won the Tripoli event in his taller-ratio car (giving him a higher maximum speed), almost an entire lap clear of his fellow Mercedes driver.
The last start by a Silver Arrow car in 1939 was in the second Belgrade City Race on 3 September. Manfred von Brauchitsch finished second in his W 154 behind Tazio Nuvolari for Auto Union. But by this time the Second World War had already begun.