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Mercury brand arrives at the end of the road after 72 years

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Mercury brand arrives at the end of the road after 72 years

By Sharon Silke Carty and James R. Healey, USA TODAY

DEARBORN, Mich. — Ford Motor's decision Wednesday to stop making its Mercury brand by year's end closes 72 years of life for a brand that hasn't had much of one lately.

Ford made the announcement here Wednesday, after days of rumors and sourced reports.

"It's time," Mark Fields, Ford's president of the Americas, said at the press conference. "This allows us to take 100% of our resources to focus on continuing to grow the Ford brand" and to making Lincoln a better rival to Cadillac and Lexus. He said the plan for the luxury brand is seven new or significantly revised Lincolns in the next four years.

As for Mercury, it was clear to nearly everyone that it was dead but didn't know it. It has accounted for just 0.9% of U.S. new vehicle sales this year, according to Autodata. And most of those were to fleets, typically at steep discounts, or to employees and retirees who, with their families and friends, get deep "insider" discounts. It also competed heavily with other Fords: The automaker's "cross-shopping" data show 53% of Mercury buyers bought one in lieu of another Ford product.

Ford has no Mercury-only dealers and just 276 Lincoln-Mercury stores that don't also sell Fords. If they'd be likely to fail as Lincoln-only stores, Ford will help them pair with a Ford store or buy them.

Bob Tasca Jr., head of the Lincoln-Mercury dealer council, says he thinks Ford has been fair. Dealers were told at a meeting this spring they'd have an answer on Mercury's future within 60 days.

"It was the only decision Ford could make," said Tasca, who owns a Ford, Lincoln, Mercury and Mazda dealership in Cranston, R.I.

Ford, like the other domestics, has often been criticized for watering down its more upscale brand with "badge engineering" — selling the same car under two or more brands, or badges, with relatively minor cosmetic changes.

Examples: Big Mercs of the 1960s were Ford Galaxies, Mercury's Bobcat in the 1970s was a Ford Pinto, Sable in the 1980s and 1990s was a Ford Taurus, today's Milan is a Ford Fusion.

Against that backdrop, it's probably hard for anyone whose Mercury awareness doesn't predate the hippie era to imagine the 1940s and 1950s Mercurys as passion machines. But that feeling is laid out in the 1949 song Mercury Blues by K.C. Douglas and Robert Geddins, and since recorded by many artists:

Well if I had money, I tell you what I'd do

I'd go downtown and buy me a Mercury or two

Crazy 'bout a Mercury.

Back then, Mercury had distinctive styling, more features and, especially, more-powerful engines, an advantage that made it beloved by hot-rodders, customizers and even Ford owners.

Dropping "a Mercury (engine) in your Ford was a big deal," recalls auto historian Ken Gross, a street-rod buff and auto writer. "Guys loved to say they had Mercurys in their '32 Fords."

In his view, what became deadly Ford-Mercury homogenization had roots in the mid-1950s as Ford tried to cut costs. Before that, Mercurys also were built on their own longer frames and, thus, had roomier interiors and bigger trunks.

A few modern Mercurys were unique. Its 1970s to 1990s Capris were German- or Australian-made Fords with no U.S. Ford equivalent.

Ford also tried to sell its German-made Merkur cars through Lincoln-Mercury dealers. Luxurious but expensive and quirky for the 1980s, it was "a horrible mistake," says Gross, ill-suited to what he calls the "full-Cleveland — white belt, white shoes — customer" typical then in Mercury showrooms.

link:

http://www.usatoday.com/money/autos/2010-06-02-mercury-story_N.htm

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Mercury is history as Ford revs up Lincoln

Lagging sales doom the 72-year-old line started by Edsel Ford

Bryce G. Hoffman / The Detroit News

Dearborn -- Ford Motor Co. said Wednesday it will pull the plug on the ailing Mercury brand by year's end to focus on fixing its luxury Lincoln line.

The brainchild of Henry Ford's son, Edsel, Mercury was launched in 1938 as a midmarket brand aimed at bridging the gap between the mass market Blue Oval brand and the luxury Lincoln marque. But Mercury vehicles often were little more than rebadged Fords, and sales have declined steadily since 1993.

"It is a storied brand," said Derrick Kuzak, Ford's global product development chief. "But what's really important today is not the past. What's important today is the future: the future of Ford and the future of Lincoln."

Mercury, with 20 million vehicles sold over its lifetime, will join the scrap heap of other domestic brands killed by General Motors Co. and Chrysler in their attempts to streamline operations to meet increasingly aggressive and popular foreign brands.

The Ford brand has performed well over the past 18 months, benefiting from a new product lineup, as well as the bankruptcies of General Motors Corp. and Chrysler LLC, and quality gaffes besetting Toyota Motor Corp.

But Lincoln has struggled to find its place in an increasingly crowded and competitive luxury market. Ford will redirect to Lincoln the resources it was investing in Mercury.

"We've made a lot of progress with the Ford brand," said Ford Americas President Mark Fields. "Now's the time to do that with Lincoln."

Kuzak said Lincoln, over the next four years, will get seven all-new or entirely refreshed products -- including a small car that had been designed for Mercury. Lincoln also will get brand-exclusive powertrains and other technologies to further distinguish it from Ford's namesake Blue Oval brand and make its vehicles more competitive with offerings from rival automakers.

Analyst George Peterson, president of AutoPacific Inc. in Tustin, Calif., said the decision to retire Mercury makes sense and has been a long time coming.

"Mercury has always taken a backseat to Ford," said Peterson, whose first car was a Mercury Monterey. "It's never been able to get the critical mass to become a major brand.

"Ford really needs to concentrate on Ford itself and making Lincoln a real luxury brand."

Fields promised that the 1,712 U.S. dealers with Mercury franchises will be "fairly and reasonably" compensated for the loss.

He also said the company will work with those retailers to make sure their remaining Ford and Lincoln franchises make up for lost Mercury sales.

There are no stand-alone Mercury dealers left. However, 276 are paired only with Lincoln, and Fields acknowledged that some may have a hard time surviving alone. The automaker will try to consolidate them with nearby Ford brand dealerships.

"My phone's been ringing off the hook," said Bob Tasca, chairman of the Lincoln Mercury Dealer Council.

Tasca, who owns Mercury franchises in Massachusetts and Rhode Island,said Mercury dealers who also own Ford and Lincoln franchises support shuttering Mercury.

"It probably simplifies their business," he said, acknowledging that most of the Ford and Mercury models on their lots "look pretty much the same."

But Tasca said dealers whose only surviving brand is Lincoln are distressed.

"Some of them are going to go out of business," he predicted.

Dealers were informed of the Mercury decision during a webcast Wednesday afternoon.

Despite persistent rumors of Mercury's demise, Ford had consistently pledged its commitment to the brand, prompting some dealers to accuse the automaker of lying.

Fields disputed that, saying the decision was made after an annual spring review of Ford's product lineup and brand strategy. "We were not lying to dealers," he said.

The last Mercurys are expected to roll of the assembly line in the fourth quarter this year. Ford will offer incentives throughout the summer to help dealers clear their lots, and expects few will be left by 2011.

Fields said no Mercury employees will lose their jobs as a result of the decision, which was made at a Ford board of directors meeting Wednesday.

The move had been expected since last week, when news leaked that the automaker was poised to kill Mercury.

Easier to retire Mercury

Mercury now claims just eight-tenths of a percent of the U.S. car and truck market, Fields said. The Ford brand, by comparison, has gained more than twice that much share in the first four months of the year.

Fields said Ford's recent success enabled the automaker to retire Mercury, providing the financial resources needed to wind down the brand without undermining Ford's goal of being "solidly profitable" this year. Ford made $2.1 billion in the first quarter.

"It really allows the company to absorb the short-term cost of discontinuing Mercury," he said.

Ford will continue to honor warranty agreements and support Mercury owners with parts and service.

Ford Chief Executive Alan Mulally made it clear since taking the top job in September 2006 that Ford's "non-core" brands were distracting the automaker from fixing the key Blue Oval brand. He moved quickly to sell off foreign brands, including Jaguar and Land Rover, and cut Ford's stake in Japan's Mazda Motor Corp. The company is finalizing a sale of its Swedish brand, Volvo, to a Chinese automaker.

Brand to grow

Kuzak said the resources to develop a small Mercury will now be channeled into a new compact Lincoln, but he emphasized that it would be a new vehicle specifically designed for Lincoln.

Lincoln also will get a new V-6 engine, new transmissions and features such as adaptive computer-controlled suspensions and retractable glass roofs. And Ford's fuel-saving EcoBoost engines will be available as an option on all Lincolns.

"Lincoln doesn't have much to excite us today," said Jeremy Anwyl, chief executive of online auto research site Edmunds.com. "But if the new resources directed to the brand help replicate the turnaround of Ford, Lincoln will be in good shape within a few years."

From The Detroit News: http://detnews.com/article/20100603/AUTO01/6030377/1148/auto01/Mercury-is-history-as-Ford-revs-up-Lincoln#ixzz0pnMOa2k2

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