Mercedes believes it is still lagging behind rivals Red Bull on outright car performance this year, despite the team leading both drivers' and constructors' championships after the opening two rounds of the season.
After seven consecutive years of title success, Mercedes looks set for its toughest battle for the championship since its period of dominance began in 2014.
Red Bull's Max Verstappen is one point behind Lewis Hamilton in the drivers' championship after winning Sunday's Emilia Romagna Grand Prix, while Red Bull is seven points behind Mercedes in the constructors' standings.
Mercedes struggled for performance at the opening round in Bahrain, qualifying 0.4s off Verstappen, but still won the race thanks to a superior tyre strategy.
The team made progress at Imola, with Hamilton securing pole position, but a slow getaway at the start for the seven-time world champion saw Verstappen take the lead before Hamilton spun out of contention for victory while trying to put pressure on the Red Bull.
Trackside engineering director Andrew Shovlin believes the Mercedes W11 is still a slower car than the Red Bull even though Hamilton went on to set the fastest lap as he recovered from ninth place to second following his spin.
"I like to think we could have put them under some pressure in the race," Shovlin said. "Whether or not we had the car to win, I don't know because I don't know how hard Max was pushing at times.
"But looking at the sectors Lewis was doing and where we were in the corners, we felt it was really close.
"But we are not going to walk away from this patting ourselves on the back, saying that we might have had the faster car by a small amount.
"We are walking away from here saying, we are not good enough and they will win the championship if we don't improve our car very quickly.
"That is our mindset, that we are still the ones chasing."
Mercedes team boss Toto Wolff believes Red Bull would have qualified ahead of Mercedes at Imola if its two drivers, Verstappen and Sergio Perez, had avoided errors on their qualifying laps.
"We are still having a deficit with the car," Wolff said. "We were on pole, but if Max had put in a decent lap we were probably 0.25s behind, maybe 0.3s.
"That is simply what the pecking order is at the moment.
"In the race it was very difficult to judge because of the circumstances, but we had a very good car today in the wet and in the drying up.
"We are slowly starting to understand it, but according to the data we still do not have a car and power unit that can match the Red Bull Honda."