That is the claim of F1 legend Niki Lauda, who doubles as Mercedes’ team chairman.
Mercedes utterly dominated between 2014 and 2016, but so far in 2017 Ferrari’s Sebastian Vettel has pulled out a lead in the championship.
“Ferrari is clearly ahead,” Lauda told the Austrian newspaper Krone.
“We need to analyse what exactly is not working and take the right steps for Barcelona. Because all the teams will bring updates, Ferrari will make a step forward, we have to make two and Red Bull needs to make three,” he added.
It is said that Mercedes’ biggest problem is inconsistency with the tyres, but Lauda says that’s not the only issue.
“We have too much weight in the car, we need to improve the aerodynamics, and above all we need to understand why the new Pirelli tyres do not work as they do on the Ferrari,” he said.
Finally, Lauda appeared to agree with reports that suggest Valtteri Bottas is on course for a new contract for 2018, after winning in Russia.
“It was a perfect performance that I never expected,” he said. “It was the right decision by Toto Wolff and myself to get Bottas on board.
“Bottas is our man,” Lauda added.