Ford#39;s Mercury Has `Changing#39; Role Sales Chief Says (Update3)
Ford;s Mercury Has `Changing; Role, Sales Chief Says (Update3)
By Bill Koenig
Feb. 7 (Bloomberg) — Ford Motor Co.;s Mercury, whose sales
have dwindled to less than a third of their 1978 peak, has a
“changing;; role as the automaker concentrates more on its Ford
and Lincoln brands, the company;s marketing chief said.
“Its role is changing, but we;re not going to compromise
Mercury,;; Group Vice President Jim Farley said yesterday in a
brief interview at the Chicago Auto Show. “No doubt Lincoln and
polishing up the Blue Oval,;; the symbol of the Ford brand, “is
absolutely our priority.;; He didn;t elaborate about Mercury.
Ford executives have been questioned in the past month by
reporters and analysts about the future of Mercury. It is the
mid-level brand between the namesake division, which generates
the majority of sales, and Lincoln;s luxury vehicles. The
automaker, seeking to revive U.S. sales to help end losses, plans
to expand Lincoln as it sells European-based luxury units.
Chief Executive Officer Alan Mulally, in response to
questions from reporters, insisted at a Jan. 8 dinner that Ford
remains committed to Mercury. At the same time, he said, the
company is studying “what we want to do with all our brands.;;
For Mercury, “the idea I think is to take what they can get
from it without expending a lot of money and management
attention,;; said Alan Baum, director of automotive forecasting
at consulting firm Planning Edge in Birmingham, Michigan.
Ford is trying to stabilize its U.S. market share for the
Ford, Lincoln and Mercury brands after a dozen years of decline.
They held 14.8 percent last year, a drop of 1.6 percentage points
from 2006, as the Dearborn, Michigan-based company;s total sales
fell 12 percent and it lost the No. 2 rank to Toyota Motor Corp.
Declining Sales
Mercury sold 168,422 cars and light trucks in the U.S. last
year, a 6.9 percent decline from 2006. The brand peaked at
579,498 in 1978. Mercury still outsells Lincoln, which increased
its total 9.1 percent last year to 131,498.
The company plans for Lincoln to take over the bulk of sales
at Lincoln-Mercury dealerships, where Mercury has accounted for
the majority.
“The Lincoln part of the Lincoln-Mercury franchise will
become the buying part of the franchise,;; Mark Fields, Ford;s
North America chief, told reporters at the Jan. 8 dinner.
When describing future plans, Ford executives haven;t been
discussing Mercury as much as the Ford and Lincoln brands.
On Jan. 16, Ford briefed financial analysts attending the
North American International Auto Show in Detroit. Derrick Kuzak,
the company;s product-development chief, said the company would
ensure Ford and Lincoln models looked different from each other.
`Very Loyal;
When the time came for analyst questions, one of the first
was why Mercury wasn;t part of the presentation. Farley, the
marketing chief, replied, “We continue to invest in Mercury. If
you talk to customers, they;re very loyal to the brand.;;
Mercury attracts “independent-minded;; customers and more
women buyers than other Ford brands, he said in the interview.
Jim Hall, principal of 2953 Analytics, a Birmingham,
Michigan, automotive consulting firm, said the Lincoln-Mercury
division still depends on Mercury sales, and Lincoln isn;t ready
yet to take up the slack.
“Take Mercury away now and you lose dealers,;; he said. At
Lincoln, he said, “the question is, will it get to Mercury
levels?;;
Ford is “looking to put their resources into Lincoln,;;
said Erich Merkle, auto analyst at consulting firm IRN Inc. in
Grand Rapids, Michigan. “If you;re going to get the most bang
for the buck, it;s Ford and most certainly Lincoln.;;
Based on Ford Models
Mercury vehicles typically have been based on Ford-brand
cars and trucks. The Mercury Mariner small SUV is a version of
the Ford Escape, while the Milan sedan is a version of the Ford
Fusion and the Sable is a version of the Ford Taurus car.
Ford during this decade hasn;t consistently developed
Mercury versions of new models. For example, there;s no Mercury
version of the either the Ford brand;s Taurus X or Edge wagons.
Mercury;s main introduction for this year is a redesigned Milan.
Since 2002, Ford executives repeatedly have said they want
to halt Mercury;s sales slide. Fields said on Jan. 8 while the
company is backing Mercury, “we understand why people ask the
question;; about the brand;s future.
Ford fell 14 cents to $6.17 at 4:02 p.m. in New York Stock
Exchange composite trading. The shares have declined 28 percent
in the past 12 months.
To contact the reporter on this story:
Bill Koenig in Chicago at
