Team Principal Toto Wolff says Mercedes must avoid "swinging between mania and depression" ahead of this weekend's Mexican Grand Prix.
The Brackley-based squad lost ground to Red Bull last time out in Austin in the Constructors' Championship, whilst Lewis Hamilton now trails Max Verstappen by 12 points in the Drivers' standings.
Mexico's Autodromo Hermanos Rodriguez has traditionally been a circuit which favours Red Bull rather than Mercedes, although Hamilton was victorious there in 2019.
"I think we have to be careful in the team that we are not always swinging too much between mania and depression, but instead, eke forward with our understanding of the car," Wolff told RacingNews365.com and other select members of the press.
"There was never a point where I thought, 'We are not going to make this'. But also [it was important] not to get ahead of ourselves after Friday [practice in Austin].
“The general feedback was that, 'You guys [Mercedes] are dominating and what is Red Bull going to do about that?', and fast forward 24 hours and it's [gone] the opposite way.
"So I think it is about really exploiting the product, the car as the product. How do we tune the product and deliver the performance? That is what is going to make the difference between losing and winning."
Mercedes' chances in Mexico
The high altitude in Mexico has favoured Red Bull's Honda and Renault power units in the turbo-hybrid era, whereas Mercedes have struggled in comparison to other venues.
Wolff believes that Hamilton and Valtteri Bottas should be in the fight for the win as long as Friday's running goes according to plan.
"Mexico is so different because of the altitude," said Wolff. "There is different aerodynamic options, the engines are under pressure in a totally different way.
"But we love Mexico City. You feel very welcome in Mexico, and I've only positive memories. So I think we need to start properly on Friday, understand the car, develop it from there, and then we will be in a position to fight for the win."
Video: How safe is a Formula 1 car?
RacingNews365.com takes a look at the most important changes over the years regarding the safety of F1 cars.