Manchester City coach Pep Guardiola said his team cannot compete with the biggest clubs in Europe today.
City lost 1-2 to rivals Manchester United in the Premier League on Saturday, to take the fourth defeat of this season and hold the title holder in third place, 14 points behind leaders Liverpool.
United completely outperformed the counterattacks on City, which seemed a shadow to a team that won the local treble last season.
Guardiola told Sky Sports: "This is the level we face, in front of Liverpool, United, Barcelona, Madrid and Juventus, they are the teams that have to face, but the truth now is that we cannot compete now."
He continued: "We must improve, we must accept this matter and look forward, we must feel this as a team in order to improve, we must accept the truth now and work to improve."