Formula One title contender Lewis Hamilton will have a five-place grid penalty for Sunday's Austrian Grand Prix after his car required an unscheduled gearbox change, Mercedes said on Friday.

The drop means he cannot equal Michael Schumacher's all-time pole position record of 68 at his home British Grand Prix next week. Hamilton is currently on 66 and had been favourite to take the top slot in Austria.

A Mercedes team spokesman said the gearbox problem resulted from the previous race in Azerbaijan.

Earlier on Friday Hamilton led the way in practice, clocking the fastest time in both sessions as he sets out to close the gap on title rival Sebastian Vettel.

The Mercedes driver was quickest in the morning session at the Red Bull Ring before beating Vettel to top spot later in the day as well.

Vettel's Ferrari was down in fourth after first practice as he looks to build on the 14-point lead he holds over Hamilton, with the pair back on track after addressing their recent issues in a press conference on Thursday.

There had been calls for Vettel to be hit with penalties for this race after he drove his car into Hamilton's at the Azerbaijan Grand Prix in protest to what he considered a dangerous braking manoeuvre.

Instead he was free to race after the FIA, motorsport's governing body, deemed he required no further punishment for the incident having been hit with a 10-second stop-and-go penalty during the race in Baku.

The pair insisted the flashpoint was now in the past and said they were fully focused on leaving Spielberg on the front foot ahead of the British Grand Prix.

It would be Hamilton who drew first blood as he led for most of the 90-minute session, with Max Verstappen second for Red Bull at their home circuit.

The second Mercedes of Valtteri Bottas was third, with Vettel almost half a second down on Hamilton.

Vettel got closer in free practice two, but he still could not match the man closest to him in the drivers' championship.

Hamilton lost a little running time due to a spark plug change and complained during his long-run stint towards the end of the session that he felt a little uncomfortable, but it was no major issue as he once again set the pace.

Bottas, who spun in both sessions, was third with Verstappen up in fourth despite spending time in the garage at the start.