In Japan last weekend, Mercedes clinched a record sixth consecutive constructors' championship, while Lewis Hamilton could claim his sixth world title next time out in Mexico.
“There's still room for improvement,” Vettel said.
“It doesn't start in Mexico – next year.
“Next year starts next year so whatever we can learn this year, I think we've learned a lot about our car, the weaknesses.
“We've improved it but we're still not there.
“We've had a strong couple of races but overall I think we're still a little bit behind.”
The German believes Ferrari has what it needs to be successful, but needs to step up if it's to mount a serious championship challenge.
“Obviously you can't see what they (Mercedes) are doing but I think from the outside they are very close to perfection every time they go out on track,” Vettel ventured.
“So, very consistent, very little mistakes. That's certainly also part of what makes them so strong.
“If you clinch the constructors' title with four races to go there's a lot of things you do better than all the others.
“If you go into detail then you can argue what their car is maybe doing better than ours but I don't think that's the point overall.
“It's a team effort,” he continued.
“As I said, I think we do have the ingredients, we do have the commitment, we do have the intelligence, but we just need to do it better.
“It's a lot of small things; it's not one thing that we need to improve, it's a lot of small things that we need to do better, every single one of us and that's the only way that we can try and step up.”
Formula 1 moves to Mexico for Round 18 of the season from October 25-27.