Villa have shown improvement lately, winning their last four games in all competitions, but O'Neill believes they will struggle.
O'Neill witnessed Villa's poor performance firsthand, attending their live game against Brentford several weeks ago.
He described the team as "rock bottom" and "really, really poor," with even their top player, Morgan Rogers, struggling to make an impact.
Villa's defense was also criticized, with O'Neill stating that they looked "frail" at the back.
However, O'Neill has faith in manager Unai Emery, citing his excellent European record and past successes.
O'Neill believes that the team's preseason challenges, including roster limitations and player departures, have had a lasting impact.
He expects Villa to get back on track eventually, but doubts whether they will regain their previous season's form.