By FOX Sports Staff
The Milton Keynes outfit had a poor outing at the British Grand Prix as championship leader Sebastian Vettel was forced to retire 11 laps before the end of the race.
Mark Webber, who had earlier announced his decision to retire at the end of the season, could only finish in second place as Nico Rosberg won his second race of the season for the Silver Arrows.
Moreover, Lewis Hamilton notched an impressive fourth-placed finish which was achieved under trying circumstances as the Briton had suffered an early tyre puncture that saw him lose the lead.
Horner, who has been one of Mercedes' most vocal critics in recent weeks over their 'secret testing' at Barcelona, could not help but be impressed by the improvement demonstrated by the team from Brackley. The duo of Rosberg and Hamilton have five pole position in five races and have scored a combined total of 176 points, becoming the second-best pairing in the F1 circuit.
"They're a good team, they've got a quick car, they've got good drivers," Horner told Sky Sports. "They're for sure going to be a contender between now and the end of the year, as are Ferrari, as are Lotus.
"There's no reason at all [to be pessimistic], but there's still a long, long way to go in this championship.
Nevertheless, the 39-year-old is not fazed by the fact that rival marques managed to close the gap on Red Bull - Ferrari's Fernando Alonso lies a mere 21 points behind Vettel in the drivers' standings.
In particular, the Red Bull chief was pleased by the raw pace demonstrated by the Red Bull cars as Webber set the fastest lap at Silverstone and left several rivals trailing in his wake.
"I think that we've learnt a bit and we've probably run a better set-up here this week. We certainly looked competitive on the long runs," Horner continued.
"We'll take encouragement from that because certainly in Barcelona we were nowhere near Ferrari's pace. But we had them covered and we're on the same pace as Mercedes by the looks of things."
Red Bull are 48 points ahead of nearest rivals Mercedes in the constructors' standings and head to Nurburgring for the German Grand Prix this weekend.