Niki Lauda believes Mercedes demonstrated in Jerez that they can compete with the top three teams in F1.
Mercedes had a mixed start to pre-season testing as they covered just 26 laps in the first two days after being hit by electrical and brake issues.
The team, though, fared much better on the final two days as Nico Rosberg and Lewis Hamilton amassed 293 laps.
Rosberg finished with the week's eighth best time overall while Hamilton was tenth,
"The cars are relatively close together," Lauda, who is a Mercedes board member and shareholder, told the Bild.
"My joy is that the Mercedes can now compete with the top three teams."
The Austrian, though, reckons Sebastian Vettel, who last season secured his third successive Drivers' title, appears to have the edge.
"Vettel is in my judgement, the fastest at the moment.
"The car works well and looks reliable. He is currently a bit faster than the rest."
Asked about Mercedes' stuttering start, Lauda said: "These tests are three so that you can eliminate errors that occur.
"Nico and Lewis were so busy on the last days that our preparations are on target. The two failures on the first days of testing were reversed."