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NINETY EIGHT REGENCY

Closing Mercury will cost Ford nearly $500 million, CFO says

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Closing Mercury will cost Ford nearly $500 million, CFO says

Jamie LaReau

Automotive News -- July 23, 2010 - 3:52 pm ET

DETROIT -- Ford Motor Co. could spend nearly $500 million to shutter its Mercury brand, CFO Lewis Booth said.

In an interview today with Automotive News, Booth said Ford took special charges of $247 million in the first half of 2010 to cover the cost of ongoing dealer reductions and shuttering the Mercury brand. He estimates the total cost to close the brand will be twice that amount.

About 700 of the 1,700 franchised Mercury dealers in the United States have signed agreements to close their stores in return for cash compensation, Booth said.

“The plan is in place and we're having very fruitful discussions with our dealers,”

Booth said. No dealer lawsuits have been filed against Ford related to the shutdown of Mercury.

Ford announced in June that it would discontinue the 71-year-old brand by Dec. 31 and focus solely on the Ford and Lincoln brands. It expects to sell off all Mercury inventory before year end. Ford plans to end production of the Mercury lineup in early October.

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100723/OEM/100729928/1255#ixzz0uXcL2Pe1

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...and pay through the nose.

When I was a kid, an Oldsmobile was the car to own...GM blew it big time with this one...

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Z-06    493

Ford's brand reduction is going to bite it big time once the volume reaches 14-15M capacity.

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balthazar    2,002

When I was a kid, an Oldsmobile was the car to own...

Interesting- for me & in my area, it was Pontiac (aside from the ubitquitous Mustang/Camaro); Olds were 'fogey' cars outside of the Cutlass.

For me, Merc began it's downslide after the '51s, but I agree that I am both saddened, and feel this is a mistake for FoMoCo.

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Croc    268

...and pay through the nose.

When I was a kid, an Oldsmobile was the car to own...GM blew it big time with this one...

They still are. Love my Aurora.

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Camino LS6    866

Slightly off-topic, but I will always remember the Cougar-from-Mustang as one of the best examples of creating a very different car from the same platform. Extremely well done.

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Slightly off-topic, but I will always remember the Cougar-from-Mustang as one of the best examples of creating a very different car from the same platform. Extremely well done.

Bingo. Right there. That is exactly what should have happened with Oldsmobile and Pontiac and Mercury. Volkswagen has been doing it for years successfully. They have about 10 brands and sell most of them globally. GM and Ford are making a huge mistake because the way to grow market share is diversity among your brands. It is not helping just trying to load up Chevrolets and Fords and assuming that people will want Chevrolets and Ford. At least GM is making Cadillac different. Lincoln has to become totally different. Not only that they are pricing Fords and Chevrolets too close and Lincolns and Buicks and Cadillacs.

There are so many Chevrolets in the showroom now that they could not bring the Orlando here.

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regfootball    250

500 mill to close it now vs. how much more to keep it going every year and in the future? since its inevitable anyways.......

Edited by regfootball

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