Lewis Hamilton says he is "massively excited" by the performance of his Mercedes car at the season-opening Australian Grand Prix.
His team-mate Nico Rosberg was third fastest behind the two Red Bulls in second practice while Hamilton was fourth in the first session.
Hamilton said: "The real positive thing is the car is competitive. I can't believe it. The guys have done an incredible job. I'm massively excited to be up there."
Hamilton ended the second session in the gravel after a part broke on his car.
He slid into the gravel trap at Turn Six after the 'bib' - the front part of the floor of his car - came loose. It was probably broken when Hamilton ran over the kerbs earlier in the session.
"I was complaining of shed loads of understeer as I was beginning my long run, so I came in and asked for three holes of front wing, which is quite a lot," Hamilton said.
"They changed the tyres. I was braking for Turn Six, I turned in and the car just didn't turn.
"I though to myself: 'What an idiot!' But when I got back they explained that the front of the bib was broken and was up against the chassis. They are trying to figure out how many points of downforce I lost. Thankfully nothing is really damaged."
Red Bull's Sebastian Vettel, world champion for the last three years, looked in dominant form as he set the pace in the second session.
But Hamilton did suggest he might have been able to get close to the German - on one lap he was slightly faster than Vettel at the first split before making a mistake and aborting the lap.
That was the start of a chain of events that led to a messy second session. Hamilton had been 0.341secs slower than Vettel in the first and just under half a second quicker than Rosberg.
Hamilton said he was thrilled that Mercedes were in such good shape considering they had been uncompetitive at the end of last season, when he was driving for McLaren, who have admitted they are struggling for pace this season.
"We've made this big step," he said. "People were talking it down, people were talking it up, really not knowing what was going to happen but to be as competitive as we are is a real buzz."
But he said it was too early to know for sure where Mercedes stood in comparison to their rivals.
"The Red Bulls are obviously very quick, the Ferraris are massively competitive, and I think also the Lotus," he said.
"I'm not sure what's happening with the McLaren but I'm sure they'll fix it because they're just a fantastic team. We're just going to take it one step at a time.
"It felt good in Barcelona [at the final pre-season test] and I didn't know whether it would feel as good here, but it definitely does.
"It's not been the best of days for me; I've been in the gravel, which I hate.
"But it has been a positive day. Nico was very competitive. To be that close to a Red Bull is hugely satisfying and it must be for the whole team back at the factory.
"But we can't get too complacent. We just need to push hard tomorrow [in qualifying], keep our feet on the ground, and see where we get."