DEARBORN, Mich. — Ford will cease production of its 72-year-old Mercury brand by the end of this year, after years of declining sales.
Mercury’s death is the latest in a string of casualties as Detroit automakers try to cut costs and invest more heavily in fewer offerings. By shedding a mid range brand that was less and less relevant to buyers, the automaker can focus on accelerating sales of Ford and beefing up its luxury Lincoln brand.
Ford plans to expand its Lincoln lineup to make up for lost Mercury sales and support Lincoln-Mercury dealers who will lose a brand. Derrick Kuzak, Ford’s product-development chief, said Lincoln will have seven new or revamped vehicles in the next four years, including the brand’s first compact car.
The automaker’s board of directors approved ending the brand Wednesday morning. Ford Americas president Mark Fields said the decision was made this spring as part of an annual business review.
He said Mercury’s sales make up such a small percentage of the North American market — less than 1 percent, compared with the Ford brand’s 16 percent — and that the profile of Ford and Mercury shoppers is so similar, it makes more sense to focus on Ford and Lincoln.
The move should help the Ford brand. Mercury was the No. 1 brand also considered by Ford buyers, said Aaron Bragman, an analyst for consulting firm IHS Global Insight. Ford said 53 percent of Mercury shoppers consider Ford and Lincoln. Ford said it will offer discounts through the summer on Mercury vehicles to shed inventory.
Ford has 1,712 dealerships selling Mercurys, although none is a stand-alone Mercury dealer. All sell Lincolns, Fords or all three brands. Ford expects some of its 276 Lincoln- Mercury dealers to continue as stand-alone Lincoln dealerships, and it will try to consolidate others into existing Ford dealerships.
All dealers will be eligible for compensation, although Fields wouldn’t say how much they will be offered.
Bob Tasca Jr., who owns two Mercury dealerships in Rhode Island and Massachusetts and is the head of Ford’s Lincoln-Mercury Dealer Council, said many dealers will get through the Mercury closure and do well selling Lincolns.
But he said the closure is still emotional because dealers will have to lay off staff and, in some cases, close showrooms.
“From a financial standpoint, it was the only decision Ford Motor Co. could make,” Tasca said.
Ford didn’t say how much it will cost to shutter the brand.
Mercury’s sales peaked in 1978 at more than 580,000 vehicles. Just more than 92,000 Mercurys were sold last year.
Mercury to hit brakes
Automobile icon Ford will phase out its 72-year-old Mercury brand this year, after decades of declining sales, to focus on fixing the luxury Lincoln brand. Conceived as a midrange brand between Ford and Lincoln, Mercury struggled in recent decades to find its place in the market. Sales have steadily declined since 1993. Mercury’s chronology
1935: Mercury is born when Henry Ford’s son Edsel begins designing a more upscale car he planned to call the Ford Falcon. But he didn’t think it fit with the brand’s other offerings, so he created a new brand named for the winged Roman god.
1938: The 1939 Mercury 8 goes into production, selling for $916 with a 95-horsepower V-8 engine; more than 65,800 are sold.
1967: The Cougar, built off the Ford Mustang chassis, debuts and thrives into the ’80s as a larger car.
1978: Sales peak at more than 580,000.
1980s: Vehicles are imported from Europe under the Merkur name.
2009: Sales of four models — the Milan sedan and Mariner small SUV — dip to 92,000.
2010: Sales are 11,800 through April.
Disappearing brands
It has become a familiar story in Detroit:
• General Motors recently shed the Saab, Saturn, Pontiac and Hummer brands.
• GM spent more than $1 billion to kill Oldsmobile in 2004.
• Chrysler dumped its Plymouth brand in 2001.
