PEP Guardiola conceded Manchester City need a rebuild after being swept aside by a Kylian Mbappe hat-trick as Real Madrid progressed to the last 16 of the Champions League 6-3 on aggregate.
Mbappe fired the 15-time winners to a 3-1 second leg win on Wednesday, but much of the damage had already been done for City by conceding two late goals to lose the home leg 3-2 last week.
It is the third time in four seasons that City have been knocked out by the Spanish giants, but the first time since Guardiola joined in 2016 that the English champions have failed to reach the last 16.
The sides were drawn to face off much earlier in the competition this time as City only sneaked through the league phase after finishing 22nd in the 36-team table.
“The better team won,” Guardiola told Spanish TV station Movistar.
“We have had a bad year in the competition. If you finish 22nd, it is because we haven’t been right. It has been our worst year.”
Injuries have played a significant part in City’s struggles this season.
Erling Haaland did not get off the bench at the Santiago Bernabeu due to a knee injury while John Stones had to be replaced inside the first 10 minutes.
City’s consolation goal came thanks to two of their January signings as Nico Gonzalez tapped in after Omar Marmoush’s free-kick came back off the crossbar.
Guardiola said the rebuild had already begun as City spent £170 million ($214 million) on bringing Marmoush, Gonzalez, Abdukodir Khusanov and Vitor Reis to the club during the mid-season transfer window.
“It is normal. Nothing lasts forever and in the group there are players that have marked an era,” added Guardiola.
“We cannot deny what this group of players have done, winning six Premier Leagues in seven years given what that competition is.
“In Europe always getting to the quarter-finals, semi-finals, final. It says a lot about what we have done.”
Madrid have gone on to win the competition each time they have beaten City in the past four years and Guardiola believes this version of Carlo Ancelotti’s men is the best he has faced.
“This year we faced the best Madrid. In the previous ones, going through or not, we were very good,” he said.
“They are better because they are able to have the ball for long spells, can run, can defend well with a high line when they want, but also defend well with men behind the ball. You have to congratulate them.”