Toto Wolff has called on Mercedes to up its rate of development and outperform Ferrari after the extent of the Italian team's power advantage became clear at the German Grand Prix.

Lewis Hamilton came away from Hockenheim victorious, but only after a late rain shower turned the race on its head and saw Sebastian Vettel crash out in slippery conditions. In qualifying on Saturday, Wolff estimated his cars were losing as much as 0.5s per lap on the straights, meaning Valtteri Bottas in second had to find 0.3s in the corners just to limit the gap to Vettel to 0.2s.

Ferrari's impressive step in performance, which is linked to the hybrid system judging by GPS traces of the car on track, came on a weekend when the Italian team introduced upgraded MGU-Ks and energy stores to all six Ferrari-powered cars on the grid. The sudden gain over the last two weekends in that area has led to some suggestions that Ferrari may have found a loophole in the regulations, but Wolff says Mercedes can only react by making its car faster.

"I think it's highly complex technology," he said at an AMG media event outside Mercedes' headquarters in Stuttgart. "If someone -- and I'm not saying somebody is, because the fact is I don't know, we are not in anybody's engine, we are not in anybody's bodywork -- but if someone were prepared to risk his reputation then there is very little possibility to police that.

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"You need to rely on the integrity of people and organisations, and we do that. At the end of the day with all the scepticism and paranoia that has always existed in Formula One we rely on the integrity of the FIA, we rely on the integrity of our competitors, because that's the only way we can go racing on a Sunday.

"I think what we've seen is that on racetracks that should have suited us -- Silverstone and Hockenheim -- they had a car that was very good on the chassis side and a power unit that was the benchmark in the field. The only reaction we can have to that is not to say 'What are they doing?' but the reaction should be 'What can we do in order to accelerate our own development program?'.

"I tell you, my mindset is really that everybody is respecting the integrity [of the regulations] because that is the only way we can go racing. If you doubt that, then the whole sport would have a problem, and I don't [doubt it]."

But in order to outdevelop Ferrari, Mercedes will have to balance upgrades for its 2018 car with work on its 2019 challenger. Revised aerodynamic regulations for next year means a number of smaller teams are switching their full focus to 2019 early in order to adapt the whole philosophy of their car to the new rules, and Wolff said Mercedes must be careful not to get caught out.

"Yeah it's a tricky one because every season you have to ask yourself when do you switch," Wolff said. "And if there's new regulations kicking in obviously the development curve is very steep at the beginning and then flattens out.

"Whoever is able to start a month earlier is going to have the advantage at the beginning of the season. So we are asking ourselves that question every day and of course cooperations between teams play a role in that also. It's not trivial and we are re-evaluating that constantly."