Citing a person familiar with the matter, the Wall Street Journal reported today that CEO Alan Mulally has already won support from key members of the Ford family to seek the board’s approval to shutter the Mercury brand. The proposal will reportedly be presented to the board in July.
With all due respect to the Journal, the fact of the matter is that Ford killed the Mercury brand decades ago. Originally positioned as a mid-priced car between the Ford and expensive Lincoln brands, Mercury was created during the Depression by Henry Ford’s son Edsel. It was Ford’s attempt to follow GM’s positioning with their various brands by creating a unique value proposition for each car brand. Unfortunately, the differences among the value propositions delivered by Ford became increasing blurred in the 1970’s. Like their counterparts at G.M., product design among the various Ford brands was reduced to ‘badge-engineering’ in which cars were differentiated by different nameplates and cosmetic features. The Ford and Mercury lines began to use common platforms with common parts. There was nothing different under the hood – think Ford Taurus and Mercury Sable. Mercury owners became increasingly unwilling to pay more for a Mercury than for a Ford. That’s why Mercury died.
Here’s the takeaway. While the official obituary of Mercery may list July 2010 as the date of death, he brand was killed many years earlier by Ford’s management incompetence. Cause of death: Badge-Engineering.
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