Christian Horner has confirmed team colleague Dr Helmut Marko’s admission that Red Bull will struggle to win the 2018 title.
Daniel Ricciardo topped the times as winter testing kicked off at cold Barcelona on Monday, but boss Horner said of Red Bull’s hopes: "We expect to reduce the gap to the top.
"Mercedes is the favourite, and if the rumours about their 1000 horse power engine are correct, then they can face the season very confidently."
Red Bull’s customer supplier Renault ended last season with serious reliability problems and with still only the third best engine on the grid.
Horner said: "I see a Renault that is better prepared for the new season.
"When reliability is better, they can turn up the power. We’ve won every grand prix and world championship as Renault customers."
And he said Red Bull could still have something up its sleeve for Australia.
"It will get really interesting next week, when the three best teams in particular will bring new parts late enough that their opponents cannot react," Horner predicted.
For 2019, Red Bull is considering a switch to Honda, who are now powering the energy drink company’s second F1 team, Toro Rosso.
"We are open to everything when it comes to 2019," Horner said, "but of course we are watching very closely what happens with Honda and Toro Rosso."
But more immediately, F1 could be looking at another Mercedes title this year, Horner predicted.
"Dominance is never good for the sport," he said. "And dominance mainly because of the engine shows what’s wrong with the sport.
"It also shows how important it is that we get it right with the engines for 2021. We need to be looking at that now, because if we let it get much later than the summer, the engine manufacturers will say they don’t have time to prepare.
"This is where we really need the FIA and Liberty. The engine question must have priority this year," Horner said.
But another priority for Red Bull will be talks with Daniel Ricciardo, whose contract is expiring. The Australian driver said on Monday that he thinks those talks will begin in April.
"He and we will want to see how the season starts to unfold, and then in due course we’ll decide what to do," Horner said.