Cape Town - Toto Wolff is adamant that Mercedes will come back stronger in China after a "personality-building" loss to Ferrari at the Australian Grand Prix.
After three years of dominating the sport, taking 19 of last year's 21 race wins, Mercedes began 2017 with a loss.
Lewis Hamilton and Valtteri Bottas finished second and third on Sunday, some 10 seconds behind race winner Sebastian Vettel.
"It's personality-building," Wolff said of the loss. "You just lose some and you win some.
"We have been very fortunate in the last three years that we won most of the races.
"And now it's about accepting that here Ferrari beat us.
"We will come back stronger. We didn't have great testing and we didn't have a great Sunday, but we will leave no stone unturned in order to win more."
There were some questions after the grand prix about the decision to pit Hamilton on lap 17 making him the first of the frontrunners to pit.
That allowed Vettel to do an overcut, handing him the lead of the grand prix.
Wolff insists is was not a sign that Mercedes had become complacent during their years of dominance.
He said: "Even if we won all those races and it looked like it was easy, it was clear that it wasn't.
"We were always skeptical whether it was good enough, and we always tried to see the negatives in everything we did, and look at the worst-case scenario.
"That is why we always considered Red Bull or Ferrari to be real competitors. And they were. So therefore the perception or the perspective is still absolutely the same.
"Losing is always personality building, and I'd much rather win than lose. But it is part of F1. We have had an exceptional run the last three years. I have always said this is outlier, you can't expect this to continue forever.
"It was clear that the moment was going to come where we need to lose with humility, and accept that somebody else has done a better job. And this is just what happened.
"They have done a great job. Their car is fast. Sebastian is a well-deserved race winner."