On the face of it, things don't look good for Lewis Hamilton's title challenge after eight rounds of the 2021 season. Red Bull has emerged with the faster car of the top two teams after winning the last four races, while Mercedes, which has not won a race since the Spanish Grand Prix in early May, is not planning to bring another major upgrade.
By contrast, Red Bull has been pushing hard with its own development, making steps with both its aerodynamic package and its Honda engine at the last two rounds. The reward was the team's most comprehensive victory of the year at its home circuit on Sunday and an 18-point lead in the drivers' championship for Max Verstappen.
Hamilton, meanwhile, had no answer for Verstappen's performance at the Styrian Grand Prix, and after stepping out of his car, said, "We need an upgrade of some sort, we need to push ... we've got to find some performance from somewhere."
Yet listening to team boss Toto Wolff on Sunday, that upgrade isn't coming.
So is Mercedes really giving up on 2021 already?
Mercedes' dilemma
Had Formula One not been forced to find ways to save money as a result of the COVID-19 pandemic, this year would have seen the introduction of a brand new set of regulations and a grid of new-look F1 cars. However, in order to save the teams from themselves during uncertain times, F1 and its governing body, the FIA, decided to delay the new rules to 2022 and effectively allow the teams to continue in 2021 with their 2020 cars.
Form a cost saving point of view, the decision to delay the new rules happily coincided with the introduction of a budget cap for 2021, meaning the spending of every team on the grid is now capped at $145 million for the year. For the top teams that has significantly reduced the amount of resources they can spend, meaning any development of this year's car is directly eating into development of the 2022 car.
In many ways, Mercedes was in the best position to deal with these changes at the start of 2020. When the season finally got underway in July, the world champions immediately had a significant performance advantage, which allowed it to switch development focus to 2021 early in the season. This was a no-brainer as the 2020 car was clearly quick enough to win the championship without a huge amount of development and, as part of the delay in the new rules, teams were forbidden to work on aerodynamic development of the all-new car for 2022.
But during the 2020 season a spanner was thrown in the works that upset Mercedes' three-year plan. Tyre supplier Pirelli was working towards a completely new type of tyre to go with the new regulations initially planned for 2021 but then delayed to 2022, and therefore had not developed the 2020 tyres. The lack of development reared its head as a potential safety issue with three failures during the 2020 British Grand Prix, and so the FIA decided to peg back the development of all teams by tweaking the aero rules for 2021.
The changes for 2021 were relatively crude in their nature, cutting a chunk out of the floor and simplifying complex aerodynamic devices around barge boards and rear brake ducts, and caused a stink during testing earlier this year when it appeared to hit the design philosophies of Mercedes and Aston Martin more than the rest of the field. All of a sudden, the wave of performance that Mercedes had hoped to ride through 2020 and 2021 came crashing down, while Red Bull and Honda made significant gains over the winter of 2020/21.
But Mercedes stuck to its original plan and turned its attention to better understanding why its 2021 car was suddenly struggling rather than work on a major upgrade package, which probably wouldn't have provided a complete fix anyway. To some extent that approach worked and Mercedes won the opening round of the season in Bahrain as well as rounds three and four in Portugal and Spain.
However, Red Bull continued to develop its 2021 car during that same period and even as Mercedes found performance, it became clear that the combination of Verstappen and the RB16-B was the quickest on the grid.
Nevertheless, under no circumstances was Mercedes willing to sacrifice the development of its 2022 project for short-term gains in 2021. Next year's car will carry the hopes of the team into a new era of Formula One, and sacrificing a head start in that new era just to win one more title in 2021 simply isn't justifiable.
"It would make no sense to put a week or two or months [of development time] back on the current car as the gains wouldn't be anywhere near of the gains you're making on the 2022 car," Mercedes team boss Toto Wolff said on Sunday.
"It is a very rational decision -- the upgrades you bring [this year] wouldn't close the aerodynamic deficit of the magnitude the aero regs for 2021 cost us, fact. And at some point Red Bull will stop aero development because it would be too dangerous to lose out on next year's championship, so the fight is still full on.
"The Red Bull Ring wasn't our best circuit in the past, it wasn't today, it doesn't mean we have no weapons in our armoury left."
What's more, F1 introduced a sliding scale of aerodynamic testing time into the regulations this year, which gives a team more development time in the wind tunnel and more time using CFD tools the lower it is down the order. Much like the draft system in American sports, it was designed to give struggling teams a helping hand and stop the biggest teams running away with it.
Mercedes only had a marginally smaller aerodynamic testing allowance than Red Bull in the first half of this year after the two teams finished 2020 first and second, but old rivals Ferrari, which finished a disappointing sixth last year, had significantly more testing time than Mercedes, making them a serious threat for 2022.
However, the sliding scale resets on June 30, meaning Mercedes and Red Bull's allowance will be reversed for the next period as Red Bull is currently leading the constructors', while Ferrari will also have slightly less now that it is fourth in this year's title fight.
Aren't Red Bull in the same position?
As Wolff pointed out, Red Bull will also have to turn its focus entirely to 2022 at some stage this year, but it seems its priorities are slightly different. Red Bull hasn't won a title since 2013 and Verstappen, who joined the team in 2016 from Toro Rosso, has never been given the shot at the title his talent clearly deserves.
As a result, it's easy to see why Red Bull would be willing to put more on the line in 2021, even if it means sacrificing 2022 to some extent. What's more, the tweaks to the 2021 rules played into Red Bull's hands over Mercedes, giving the team a rare opportunity that would be hard not to chase.
"For the first time in quite a while we've come out the blocks this year with a competitive car and we've managed to optimise that and tune it," Red Bull team principal Christian Horner said on Sunday.
"But you're at the top of the [development] curve with these cars, you're into marginal gains and obviously when you look at the new car for next year every time it goes through a development cycle it's significant steps, so it's getting that balance right between the marginal gains for this year and the big steps for next year.
"What Mercedes do is very much their business, so we're just focused on ourselves and we know that Toto likes to throw the light somewhere else, so I can't believe that they'll go through the rest of this year without putting a single component on the car.
"But as I say, what we can do is focus on our own job. Of course it is a balancing act between this year and next year, but if that means we've all got to work a bit harder than the other teams, we are fully up for it."
Verstappen added: "I don't know what's going on with other teams but I know that, of course, from our side, we do improve our car almost every race, which I think is very important -- because we have a good opportunity to have a good season.
"I'm confident with the people we have in the team that also the focus for next year is 100 percent. So, I think so far I don't see that compromise -- but of course time will tell next year if it's like that!
"I fully agree with the approach we have for this season."
Can Mercedes still fight back?
Despite Red Bull's four straight victories, the championship is still very close. Mercedes struggled at the street circuits in Monaco and Baku, but one week ago in France the two teams were incredibly close, with Red Bull winning the race on strategy rather than outright performance.
The Red Bull Ring clearly suits the Red Bull car, and the vans of upgrades that were seen arriving outside the Red Bull garage over the weekend suggest the team put extra emphasis on winning the double header at its home circuit. But the following round in Silverstone in three weeks has always been a Mercedes stronghold and engineers within the team remain quietly confident that the performance gap between the two cars will swing back in its favour for the British Grand Prix.
"This is far from over," Wolff said. "We had a very difficult weekend in Austria with no weapons in our armoury to win this race fair and straight, but we will be winning races this year and will be having pole positions and will be fighting as much as we can for every single result."
Hamilton added: "I'm not going to question the team's logic and how they got through with their process. As I said, I would love to have an upgrade, but I don't think it's in the pipeline at the moment.
"We're down on a few areas. It's been close at the beginning of the season and if we were both -- Red Bull and us -- had the same performance as we did in those first four races then perhaps it would be a little more exciting, but as I said, they've taken a decent step forwards but we will work as hard as we can to manoeuvre around it.
"But in terms of baseline performance this is what we've got. I think we did a decent job today, but we're going to keep pushing."