I'd be careful to judge the car based on this weekend. They were nowhere on Friday, in the wet FP3 they looked even worse and suddenly they came alive in Quali and the race. Red Bull also looked off pace on Friday and were suddenly in the hunt for pole on Saturday and on race day they were blindingly fast. Ferrari conversely went backward as the weekend progressed!
Merc themselves don't seem to fully know why the car suddenly found big pace. I suspect conditions, set-up etc by change just worked properly for once (like in Silverstone) and they had a fast car. That is the conclusion by many others too. They are improving yes, but this was a strange very changeable weekend where things just came to them. Lets see how they go post summer break.