Ford Poised to Kill 71-Year-Old Mercury Brand

Ford Motor Company is ready to wind down the 71-year-old Mercury brand, augmenting the list of historic domestic nameplates put to rest in the last few years as the auto industry has gotten increasingly competitive.

Alan Mulally, Ford’s CEO, and other top Ford officers have secured the backing of the Ford family and will now seek the approval of the automaker’s board to phase out Mercury after more than a decade of languishing sales, a source familiar with the matter said on Thursday.

Mercury’s Rise and Fall

Edsel Ford, the son of company founder Henry Ford, created Mercury in 1939. Mercury’s genesis was the result of General Motors’ strategy to create a “ladder of brands,” including Chevrolet, Pontiac, Oldsmobile, Buick, and Cadillac. That structure enabled GM to appeal to a large range of consumers and push them up the price and brand ladder as their incomes grew, allowing GM to surpass Ford as the largest carmaker in the world.

Mercury now becomes the most recent Detroit brand to fall away since 2000. As a result of its bankruptcy restructuring in 2009, GM closed its Saturn and Pontiac divisions, and Hummer will likely see the same fate. Earlier in the decade, GM killed off Oldsmobile, while Chrysler phased out Plymouth.

The future of the Mercury brand has been uncertain ever since Mulally took the reins as CEO in 2006 and laid out a turnaround strategy that included eliminating niche brands and placing most of the corporation’s resources into the main Ford division. Since Mulally’s arrival, Ford has sold Volvo, Jaguar, and Land Rover.

A source close to the company said Mulally and other top executives recently convinced the corporation’s chairman, William C. Ford, Jr., and his cousin Elena Ford, also an employee, to kill off Mercury. Heretofore, Elena Ford had vehemently opposed suggestions of shutting down the Mercury brand.

Mercury’s Niche

Theoretically, Mercury was intended to create a midpriced vehicle that fell between affordable Ford models and the automaker’s more upscale Lincoln models.

For many years, that strategy succeeded, with Mercury models like the Marquis and Cougar selling well. However, by the 1980s, Mercury had little of its own brand identity, something that happened to many Detroit marques. Most Mercury vehicles were little more than Fords equipped with different taillights and grilles. GM made the same mistake, selling almost identical vehicles as Chevrolets, Buicks, Oldsmobiles, and Pontiacs.

During the 1990s, Ford imported several sports-car models manufactured by its European division and sold them under the Mercury name, but the strategy did not improve the brand’s profile.

Recently, Ford attempted to market Mercury to female drivers, but sales continued to plummet. Last year, Ford sold 92,299 Mercury models, down from 359,143 in 2000.

“Mercury is a brand that has lost its meaning in the American automotive marketplace and it isn’t worth trying to change that,” Edmunds.com CEO Jeremy Anwyl said in a statement.