Ford Motor Co. (F) has decided to discontinue its 71-year old Mercury old line due to its lagging sales over the last few years. The company’s CEO, Alan Mulally, had expressed his dissatisfaction about the sales performance of the brand soon after he joined in 2006. However, he had failed to phase out the brand at that time due to a strong opposition from the Ford family.
The Mercury brand had been founded by Edsel Ford — son of Henry Ford — in 1939 to market entry-level luxury cars. It is similar to General Motor’s (MTLQQ) Buick and Chrysler’s namesake brand. In 1958, the brand was merged with Ford’s Lincoln division and has since been manufactured under the Lincoln–Mercury division.
Mercury saw its heydays in 1978 and then again 1993. However, the brand’s popularity has languished since then with sales falling by more than half annually. In 1999, the brand was dropped in Canada with only the Grand Marquis model selling in the region. Last year, the brand’s sales dwindled to almost a fourth of its sales in 2000 at 92,299 vehicles.
Alan Mulally and other senior executives have recently convinced the Ford family to phase out the brand in order to focus on its namesake brand. Ford will suspend production of two out of the four existing Mercury models — the Mountaineer and Grand Marquis — in this year. The future of the remaining two models, the midsize sedan Milan and a small sport utility vehicle Mariner, is currently unknown.
Under the supervision of Mulally, Ford has already sold the U.K.-based Jaguar and Land Rover brands to the Indian auto giant Tata Motors (TTM). It had also put up its Volvo cars for sale in December 2008, which will be acquired by China’s Zhejiang Geely Holding Group. Currently, the company is also considering the future of its Lincoln brand, which has been struggling despite its new line-up.
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