Dr Helmut Marko is confident Red Bull will be able to defend Max Verstappen's back-to-back titles in 2023.
The energy drink owned team also won the constructors' championship last year.
"Yes, we want to defend both titles," said Marko, the team's 79-year-old top Austrian official.
"But I don't expect a season as dominant as 2022."
It was Ferrari that finished second overall last season, but Marko thinks Mercedes is better placed to mount the challenge this year.
"If you take the team structures, driver personalities and qualities, Mercedes is our strongest opponent," he told Krone newspaper.
"They have proven in the past that they are very good strategically. Russell is getting stronger and Hamilton taking points away is a good thing.
"But Ferrari has solved its reliability problem and now has more power," Marko acknowledged.
Not just that, Red Bull's wind tunnel development time has been cut by 10 percent as a result of the minor budget cap overspend revealed last year.
"We had no room for experimentation," Marko admits.
"But last year we had the best car, so if this one - which was finished on time - works, which I'm sure of, the uneasy feeling will be quite modest," he said ahead of the start of the mere three days of official testing in Bahrain.
Dutchman Verstappen, 25, admits he is the favourite.
"That's just logical," he told Sky Italia. "But it's not obvious because every year you have to perform well no matter what you achieved before. You have to prove it again.
"But we are confident for this season," Verstappen said.
Marko agrees that Red Bull's competition should be closer this season.
"We don't have a big lead when it comes to the engine and the regulations are now a year old," he told Sport1. "We can assume that the field will move closer together.
Marko also admitted to the Austrian newspaper Krone that Red Bull's 2023 car is an evolution rather than a revolution.
"Since not much has changed in terms of the regulations, we assume that we have a good package," he said. "The floor is a bit shorter, plus a few small things. But I'm not a engineer."
On the engine front, however, although Red Bull will team up with Ford in 2026, Honda is vowing to keep working hard in collaboration with Red Bull Powertrains until then.
"There is an increase in performance that we can release without affecting reliability," said Marko.
"But the numbers that are buzzing around from Ferrari are certainly not right."
