— The demise of Mercury may be good for some dealers as Ford spends more to market and develop its Lincoln brand, but it could also speed dealer consolidation.
After 71 years of selling Mercury cars and trucks, Ford has decided to stop producing vehicles for the brand at the end of this year, partly because Mercury's market share had dwindled to less than 1 percent.
Ford has 1,712 dealers with a Mercury franchise, many also selling the Ford brand. The company has just 276 stand-alone Lincoln-Mercury dealers.
Dealers who also sell Fords said they would not be affected much by the move.
"There is no negative impact on me because I am also a Ford dealer," said Larry Taylor, in Vandalia, Ohio, who purchased a Lincoln-Mercury dealership 30 days ago.
But for stand-alones, "they are going to lose half of their volume," he said.
To boost Lincoln, Ford plans to introduce seven new or significantly refreshed cars, SUVs and crossovers the next four years, including the first compact car for Lincoln, said Derrick Kuzak, Ford's group vice president of product development.
"It will not be a badge-engineered version of another Ford," Kuzak said.
Still, Bob Tasca Jr., chairman of the Lincoln-Mercury dealer council, acknowledged that the decision to terminate the Mercury brand will be difficult and emotional for many dealers.
"You have to feel sorry for the stand-alone dealers," Tasca said. "Some may not be able to survive it."
Ford's announcement to end the storied Mercury brand, which was sandwiched between Ford's luxury Lincoln and mainstream Ford brands, came after years of rumors and an announcement this year that the company was developing a new compact for Mercury called the Tracer.
Mercury's lineup has shrunk in recent years, and sales have followed, tumbling to 92,000 last year from a peak of more than 580,000 vehicles in 1978.
Mercury has just four vehicles: Milan, Mountaineer, Grand Marquis and Mariner.
Ford President of the Americas Mark Fields said all Mercury dealers will be eligible for compensation for the loss of their dealerships based on the size of the dealership and other factors.
Michael Stanford, owner of Varsity Lincoln-Mercury in Novi, Mich., said his dealership should be able to survive as a Lincoln store.
Last year, Stanford sold about 2,500 Lincoln and Mercury vehicles. He said his dealership can survive with 1,250 vehicles per year, and he expects that volume will increase as Ford expands its Lincoln lineup.
Andy Czajkowski, a small Ford dealer from rural Van Wert, Ohio, said Mercury accounts for about 10 percent of his total sales.
"My Mercury customers are disappointed. They are bummed out," Czajkowski said, adding that he would easily switch them to Ford or Lincoln.Copyright © 2015, CT Now