Red Bull advisor Dr Helmut Marko has said the team are "positive" they can be "very near" to Mercedes by the halfway point of the season.
Marko believes engine suppliers Renault are heading in the right direction, but there is still a way to go before they can potentially go toe-to-toe with the World Champions.
"Of course Mercedes are still the favourite," Marko told Sky Sports. "They have the fastest engine and the most reliability.
"Renault is catching up, how much, we will see when we go to Melbourne. But we are positive that we can be very near to them by mid-season."
Marko also spoke to Sebastian Vettel's father Norbert at the track, and added: "Sebastian had an unlucky season last year. Ferrari look strong, but you never know how much extra weight the Italians are carrying!"