Mercedes dominated the series during the previous rules era, winning both the drivers' and the constructors' titles every year from 2014 to 2020.
But the rules overhaul in 2022 left the team on the back foot and has so far been unable to recover to mount a challenge for race wins on a regular basis.
A change to its car concept for 2024 appears to also have failed to help Mercedes lift its form, with George Russell saying after the Miami GP that the team needed to accept it was the fourth-fastest at the moment.
Lowe, who worked at Mercedes from 2013 to 2017, believes the team made some wrong decisions from an aerodynamic point of view when interpreting the current regulations.
The former McLaren and Williams technical director suggested it would take a long time for Mercedes to overcome those setbacks.
Speaking to Motorsport.com in an interview, Lowe said: "I have a lot of sympathy and in fairness if you talk to teams that are doing well if they aren't too arrogant and they will say 'You should count on having good fortune in this sport when you have a good car and don't assume it is always from your own brilliance'.
"That is a message that most of us have learned over the years.
"Mercedes have made some wrong turns aerodynamically. The tools that we use are incredibly sophisticated, wind tunnels and CFD and so on but nevertheless highly flawed and all teams will admit this.
"Therefore, there is always risk you go down an avenue that doesn't work in real life and then you have to recover, and you can see that has been the case with Mercedes.
"That is very difficult to recover simply over a matter of time.
"Your team has huge numbers of people and all of your machinery for testing and evaluating ideas should be churning out lap time on a daily basis, and if your competitors are doing that and you have, say, lost three, four, six months for whatever reason, even if you get back on track it is very difficult to produce lap time at a higher rate than they are, so you remain with this offset for a long time as you try and claw it back.
"When I look at Mercedes, this is the situation they are in," added Lowe, the founder and current CEO of the carbon-neutral synthetic fuel concern Zero Petroleum.
Asked if he had the confidence Mercedes will recover, Lowe said: "You may or may not get there. It may get worse. This is the nature of the sport and why it is so fascinating to watch as champions come and go.
"Empires rise and fall, and I always thought Formula 1 was a bit like that, a bit like the Romans and the Greeks. There are lots of components to that and complacency can be one of them, and we saw that with the Romans.
"We were very happy in 1992 at Williams to beat McLaren, who had seen unbeatable for some years, and you come out and you beat them, and you can't believe it to start with, but something has changed and lots of thing can contribute to it."
Lowe reckons the next major rules overhaul in 2026 may offer Mercedes the opportunity it needs to return to its former glory.
"The 2026 regulations will be a disturbance that Mercedes are looking forward to see if they can disturb the status quo," Lowe added.
"But unfortunately today's formula is very much about optimisation at a micro level on top of some basic structures that you chose or copy or evolve to and then it is about optimisation, and it is very difficult to make step changes within that space."
