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by Tim Beissmann

After 71 years, Ford Motor Co has made the decision to close down its Mercury brand and shift focus to its two remaining badges: Ford and Lincoln.

Mercury production will end in the fourth-quarter of this year, but Ford does not expect the closure to lead to job cuts or impact on profit forecasts.

The restructuring means that Lincoln will receive significantly more financial and engineering attention, with Ford planning to introduce seven all-new or majorly redesigned vehicles to its line-up.

Ford President of the Americas, Mark Fields, said the decision to wind-down the Mercury brand was made at Ford’s annual business review during the American spring.

“Given our improving financial situation, it really allows the company to absorb the short-term cost of discontinuing Mercury. We don’t take this decision lightly,” he said.

Despite sales increasing 11.6 percent year-to-date for the first five months to 41,680, Mercury sales have been heading south since the brand’s golden years of the late-1970s.

Mercury’s total market share for 2010 is around 0.8 percent, while the Ford brand has added two percent this year alone, with sales up 33.8 percent to 704,721.

Mercury now joins Aston Martin, Jaguar, Land Rover and Volvo as brands shed by Ford Motor Co in the past three years.

Mr Fields confirmed that every one of Mercury’s 1712 dealers would be contacted by Ford representatives within 36 hours as they map out plans for the future.

There are no stand-alone Mercury dealers in the US, with 925 teamed with both Ford and Lincoln, 511 with Ford and 276 with Lincoln.

Mr Fields said many Mercury customers were loyal buyers who purchased through employee and retiree discount schemes, leading to lower profits. He was confident that they would remain with either Ford or Lincoln beyond 2010.

“The profile of the customers, the pricing, the margins is almost identical to Ford and at the same time, Mercury’s brand awareness remains low.”

Ford Chief Executive, Alan Mulally, a close subscriber to the Toyota Motor Co branding and manufacturing strategy, will now have a Ford/Lincoln structure similar to the Toyota/Lexus one.

The updated Lincoln MKX SUV will be the first of seven new vehicles to the range over the next four years, including a Lincoln-first small car, which it promises will be more than just a rebadged Ford or out-going Mercury model.

(with Reuters)




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