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Ford will keep customers despite dropping Mercury, Edmunds.com states

Monday, May 31, 2010 - 23:00

Bloomberg has reported that Ford will discontinue the Mercury brand. But when Mercury shuts down, Ford is likely to keep most of its customers, according to Edmunds.com.

Edmunds.com’s cross-shopping analysis indicates that 46 percent of Mercury shoppers currently consider Ford vehicles, and that Chevrolet and Honda are also popular alternatives.

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

Mercury currently represents 5.6 percent of total Ford Motor Company sales. In April, the brand’s True Cost of IncentivesSM was approximately $3,326 per vehicle sold, compared with $3,172 for the Ford brand.

“For years Ford executives have been asked why they keep Mercury, but they had been adamant about keeping the brand for reasons that are unclear and now, apparently, dismissible,” says Edmunds.com Senior Analyst Michelle Krebs in her report for AutoObserver.com. “Clearly, it is more cost-effective to focus precious marketing dollars on fewer brands. Seemingly in preparation for this announcement, Ford had significantly cut back on Mercury marketing money of late.”

“Like Plymouth and Oldsmobile, Mercury is a victim of both increased competition from outside its corporate parent and a lack of differentiation from within. Mercury products have been nothing more than modestly restyled Fords for decades, and that’s not how you build or maintain a brand,” adds Edmunds.com Senior Analyst Karl Brauer.

“Mercury was launched in the 1930s, when Henry Ford’s son Edsel saw an opportunity to create an additional brand within the Ford hierarchy between the everyman Ford Deluxes and premium Lincoln Zephyrs,” recalls Edmunds’ InsideLine.com Editor Scott Oldham. “In the '50s, Mercury vehicles were renowned for style, performance and cutting-edge technology. A dash of glamour was added to the automaker's image when James Dean appeared onscreen in a Mercury car in the film Rebel Without A Cause.”

A detailed history of Mercury can be found at www.edmunds.com/mercury/history.html.

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