After Lewis Hamilton's breakthrough return to pole position in Hungary, Toto Wolff hinted that the next step is a signature on a 2024 contract.
"It's not signed but we've done it emotionally," the Mercedes boss said.
Hamilton agreed: "It's taking more time than we all thought to get to where we want to be, but I think we'll get there."
The result on Saturday ended Max Verstappen's run of dominance, with the Dutchman saying he qualified three thousands behind Hamilton because his Red Bull car felt "terrible".
"I think the update works but I think we just didn't put everything together setup wise," Verstappen said.
"It doesn't matter where you are on the grid. If it doesn't feel good, it doesn't feel good."
Dr Helmut Marko agrees: "Our number say the new parts are working."
In the sister Red Bull, Sergio Perez at least returned to Q3 for the first time in six rounds - but Dr Helmut Marko kept his criticism of the Mexican in check.
"The first practice session was wet and because Perez crashed, we didn't get any insights," Marko said.
"The car doesn't behave quite as expected it would here," he added at the Hungaroring. "We lose in turns 5 and 6 and have problems with the curbs.
"For Perez, it was an important performance. He had the same problems as Max. He is five tenths behind, but the reason is Max.
"You can't blame Perez for that."
But while Mercedes was celebrating, Wolff does not expect Hamilton to stay ahead after a long race on Sunday.
"Max's long runs on this circuit are from another planet," he insisted.
However, the first step for Verstappen will be to get through the opening first lap with Hamilton. Red Bull boss Christian Horner reminded the F1 world that the pair obviously have "history".
"As long as they get through the first corners together, it will get interesting after that."
Wolff also warned: "Lewis and Max both have nothing to lose.
"Lewis will give everything he has to make it a great fight. Our biggest weakness hasn't been that our car lacks downforce. The problem is the unpredictability of the rear.
"Today, Lewis had confidence in the car. At the same time, we must also remain realistic."
Hamilton, though, is hopeful.
"They (Red Bull) have become a little slower compared to the beginning of the year. Look at DRS - they don't have the advantage they used to," he said.
"Where did it go? They also had an update here - we expected it to be a good step forward, two tenths or something."
Red Bull's Marko agreed that the Hamilton and Verstappen rivalry "still contains a bit of fuel" ahead of their lap 1 battle on Sunday.
"At least there is no longer any talk of boredom in Formula 1," he said.
"Yesterday, Hamilton was very fast on the single laps - faster than us," Marko told Servus TV.
"Overtaking is very, very difficult here so it will be an interesting and tough race." body check tags ::
