The German manufacturer was outgunned by McLaren at the British Grand Prix in the battle behind Red Bull, as Lewis Hamilton did not have the pace to overhaul Lando Norris for second spot.
A major overhaul of the W14 introduced at the Monaco Grand Prix had initially appeared to give the squad the uptick in form it felt it needed to fight for wins, but it has failed to build on that early promise.
And as it appears stuck in the chasing pack behind Red Bull, there is a growing acceptance that the team cannot make the changes it wants with the W14 that it feels is essential to close down the deficit to the front.
That is why team boss Toto Wolff thinks the moment is nearing where Mercedes will have to accept that its future is better set throwing all its resources towards what is expected to be a fundamental redesign for next season.
Asked by Autosport at what point that decision will be made, Wolff said “I think pretty soon. We have no choice.
“P2 or P3 fundamentally doesn't impact me and the team. It's about coming back and being able to win a world championship in that respect. That's not going to happen this year.
“So we need to set our eyes to next year and then, at all the races to come, learn and develop, and make sure that we can carry that forward into next year.
“But, having said that, the regulations are the same. So it's not that you're not learning nothing by continuing this car. It's a balance that we have to strike right.”
While McLaren’s amazing step forward this season has highlighted the potential for big gains, Mercedes does not see scope for it to do a similar step soon.
Wolff said that limitations imposed by the cost cap, plus wind tunnel restrictions, leave his outfit only able to bring some minor improvements over the remainder of the campaign.
“I think we are restricted by the cost cap and by the relative less amount in wind tunnel and CFD time that McLaren was able to have,” he explained.
"They finished further back in the championship and they were like fifth or sixth mid-year. So they carried over that more wind tunnel time allocation. And that's why it's kind of difficult.
“Do I believe that we have upgrades in there that are going to fundamentally change the car? I don't believe so. But we have a few small steps that are to come. And you can see that if you find the tenth or two or three, it puts you in a different position on the grid.”
Mercedes’ admission that thoughts will soon have to shift to 2024 come after a British GP weekend where the team had hoped to perform much better, as Silverstone’s high-speed swoops should have suited the car perfectly. Instead, it was McLaren that shone at the track.
Wolff still believes that the squad can pull together a win to beat Verstappen at some point, but it is not going to be easy – especially as he thinks the current car is worse for his drivers than the infamous W08 from 2017 that earned the ‘Diva’ nickname.
Wolff added: “I thought that Silverstone based on our historic performances was the best shot, but it wasn't. So maybe there's another track where we have the best shot because the characteristics of the car have changed.
“I always believe that we can beat Max, we have a good group of people, and the best drivers.
“We just have to give them a car that is more predictable, and not the Diva 2.0, plus much more complicated than the first one.”
