Niki Lauda has said he is "not entirely happy" with how the second test has worked out for Mercedes, with updates failing to live up to expectations.
Ferrari and Sebastian Vettel gave an early teaser of the pace that is come by setting the fastest time of testing so far and while Mercedes have also helped set the bar with their pace and reliability, Lauda is not particularly pleased with what he has seen.
"Personally, I'm not entirely happy," Lauda told RTL.
"We tested a few updates which didn't work out as we had expected them to.
"This is why we need to test again, tomorrow, too.
"We have to make further changes in order to understand how the car moves around the circuit in the fastest way possible.
"I'm sure we can solve these problems [for the first race in] Melbourne."
Lauda was also asked for his thoughts on the title race for 2017, but believes it is still too early to say.
"I don't think anybody can say today," he added.
"Mercedes is facing a tough year. But we will give our best. I'm optimistic.
"The first three races will give us an idea. After that we'll have an understanding of how the competitive order looks like.
"I think Ferrari, Mercedes and Red Bull are close together, within maybe two or three tenths.
"So the field got closer, which is great. This is good news for the season opener."
Lauda, though, is pleased with how Valtteri Bottas has settled into life with Mercedes after replacing the retired World Champion Nico Rosberg.
"Valtteri edged closer to Lewis' qualifying performance. He's missing only two tenths now. This is good," he said.
"He still has to evolve in the long runs. However, he drives the Mercedes for the first time.
"He has to work a lot to learn all these things. Up until now I'm more than happy with him."