Mercedes' Sao Paulo Grand Prix performance was their "worst weekend in 13 years", says team principal Toto Wolff.
Lewis Hamilton finished eighth after an uncompetitive race while team-mate George Russell retired from 11th because his engine was about to fail.
Wolff said Mercedes' lack of pace was "baffling" and "unacceptable".
"We will have a fundamentally different car next year and this confirms that is the right thing to do," Wolff said.
The worst result of Mercedes' season came at the end of a week that started with the announcement that chief technical officer Mike Elliott was leaving the team.
Elliott was ultimately responsible for the radical and unique design direction Mercedes chose in 2022, and which they stuck with in 2023 against Hamilton's wishes.
Mercedes had headed to Brazil with optimism after Hamilton finished second in the previous two races in the US and Mexico, although he was disqualified in Austin for the floor being worn away too much.
Those performances came after Mercedes introduced a new floor, which they believed had provided a good step forward in performance.
"We are a proper structure, a solid team and that didn't look like a solid team today," Wolff said. "Interestingly, within three consecutive races, you are finishing a strong second in two and challenging Max [Verstappen] and then a week later you are nowhere. And I believe this is just not on.
"This car, the development has been more plasters we put on something not right, and it shows that it is so unpredictable that it can swing either side."
His remark is a reference to his belief that the current Mercedes is a fundamentally flawed concept with so many major issues that require a whole new car to rectify them.
Mercedes were at a loss to explain their lack of performance in Brazil, but both Wolff and Hamilton said they believed they had run the car too high on the bumpy surface of the Interlagos track.
That could be a legacy of their disqualification in the US.
The team also admitted they had run too big a rear wing in the search for grip in the corners, which had created too much drag on the straights. They were also suffering with excessive tyre usage, normally a strength of the car.
Hamilton said: "My guess is that the floor is not working, it is not sucking down and it's pushed us to a higher wing and then we are massively draggy on the straights and sliding in the corner. We have to look into why that is the case on this rough circuit.
"The tyres were overheating slow on the straights, no grip in the corners."
Wolff said: "We ran the car way too high and you carry that on. But that wasn't the main reason for an absolute off-weekend.
"There is something fundamentally wrong mechanically. It's not a rear wing or the car being slightly too high. We are talking a millimetre or two. It is performance but it is not the explanation for a total off-weekend."
Hamilton has previously expressed optimism that Mercedes can make a big step forward over the winter but he remains concerned about whether they will be able to catch Red Bull, who have dominated this season with Max Verstappen.
He added: "All I can do is try and remain optimistic but the Red Bull is so far away that they are probably going to be very clear for the next couple of years."
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