This tends to point in the direction of a new application of the Two-Mode hybrid being developed by GM, DCX and BMW, although it may also be mild hybrid that Mercedes is developing just with BMW. Either way, it looks like Mercedes will not follow Lexus's lead by using the hybrid to enhance power like the LS600h. Instead, the gas hybrid will slot into the middle of the lineup mated to a 3.5L direct injected V-6. This will reportedly yield over 25mpg combined in the 4,500lb S-Class.
[Source: AutoCar (subs req'd)]