Way Forward goes WOT tomorrow, all brands are safe
Ford announced this afternoon that it will be presenting an Accelerated Way Forward plan, also known as Way Forward 2.0 in the web savvy crowd, at 7 AM tomorrow. Assuming we get to bed on time and experience no alarm malfunctions, we'll be on hand to bring you the details as they come in. No doubt the acceleration will involve more job cuts, a much needed plan to streamline the company's distribution chain, and perhaps even a product announcement or two.The Detroit Free Press is also telling us that all of Ford's eight brands will survive the chopping block tomorrow morning. While Aston Martin is still up for sale, none of the brands will be killed off in the fashion of Oldsmobile's demise at the hands of General Motors. Of course, those who have beating the drum for Ford to get rid of the Mercury brand are being very critical. Accusing Ford of being too emotional over keeping Mercury, most are pointing out the obvious that funds spent on keeping the brand alive could be better spent elsewhere.
[Source: Ford, Detroit Free Press]
Reader Comments (Page 1 of 2)
Michael Karesh 2:02PM (9/14/2006)
Usually I'm against killing brands. But Mercury is the weakest domestic brand by far. At least Buick has had a brand identity. People cared about Buicks.
No one has ever cared about Mercury. Except for a year here and there where Ford made a move to really do something with it, the Mercury brand has been redundant since 1938.
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CoreyW 2:14PM (9/14/2006)
"Accelerated Way Forward plan, also known as Way Forward 2.0"
Will this be followed by the Way Forward Plan Upgrade v2.05b?
Ok, revision numbers in software is normal/expected. I don't think you get the same effect putting it at the end of your corporate restructuring plan.
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MattB 2:07PM (9/14/2006)
I for one would hate to see Mercury go, but not for emotional connections. I think Mercury has a great style language, even if all they carry is warmed over Ford products. I like that the waterfall grill, two-toned interior, stylized taillights, etc. have been applied to all their vehicles--it makes the brand look so cohesive. If only Ford's or Lincoln's vehicles exhibited this.
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Oshawa forever 2:27PM (9/14/2006)
Please bring Mecury back to Canada. The Milan is a hot car with style.
Unlike the Toyota Camry that is the most borring mid-sized car in north America....
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CoreyW 2:15PM (9/14/2006)
Michael,
IMO, they need to drop Mercury, Land Rover and Jaguar. Aston Martin seems like it has sooooo much potential.
But I guess the need to keep Lincoln and Jaguar OR Aston Martin, but not both.
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CoreyW 2:19PM (9/14/2006)
MattB,
I agree they should push more of the Mercury styling in the Lincoln and Ford products. But I would still get rid of Mercury before Aston M.
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Dan 2:24PM (9/14/2006)
Mercury could and should be a very successful brand within the Ford Family of Fine Cars! It should return to the days when it was a clear step up from the Ford and very nicely filled in between a Ford and a Lincoln. These three products make perfect scence in thre distinct price ranges.
Mercury needs to build a new retro Cougar based on the Mustang platform. This would be low cost and if done right could be a real hit.
The Montego needs to be restyled and it needs some choice in power - all the way up to a V8.
The Meta One with a diesel hybrid getting about 60 MPG would be awsome. And, they should build an up-scale Merc version of the outstanding Ford "Reflex."
Mercury can be a very solid brand if Ford would just get some passion back in their products.
I hope they succeed.
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Michael Karesh 2:37PM (9/14/2006)
They could just offer Mercury cues as the "Art Deco Deluxe Styling Package" on Fords and be done with it.
Mercury has hardly ever been a clear anything. This is why people get so upset when GM badge engineers products, but say very little when Ford does it to a much larger extent. People have never thought of Mercury as anything different than a slightly upgraded (at most) rebadged Ford.
Land Rover, Jaguar, and Aston all make perfect sense as brands. Each one has a clear identity with a lot of potential value. Their products are distinctive.
They might not make sense under Ford ownership, but they do make sense. I think BMW could do awesome things with Jaguar. It would let them serve two markets with the same basic mechanicals, and thus they wouldn't feel the need to continuing luxing up the BMW brand.
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brad 2:41PM (9/14/2006)
But the woman in the mercury commercials is sooooooo HOT at least keep her!
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Richard Warren 4:26PM (9/14/2006)
I always sort of get a good chuckle out of "potential"
Known 133,301 Mercury's sold through August
Best year (2005)for Aston Martin 4,500
While I love Aston Martin as a car, from a business point of view it makes more sense to dump some of the other baggage and spend the money to make Mercury more unique. Lets say they could double sales, that's only 9,000 cars a year. What is the profit potential?
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robert bell 2:54PM (9/14/2006)
It appears Mr. Mullaly is thinking very clearly about the Way Forward by deciding to "save" all existing brands.
If the Way Forward is to produce, at the end of the turnaround tunnel, a company capable of competing in all the relevant categories, Ford must resurrect Mercury for the mid-price category to be competitive with Buick, Dodge and the mid-priced imports. Killing that brand now would leave a huge hole in the Ford lineup if the company can be turned around.
What I suspect Mullaly and company will do is redefine each of these brands and simplify the product mix for each so that branding can be more direct and customers targeted more precisely. Consolidation will likely occur in the dealer line up where fewer dealers may be asked to sell multiple brands and smaller less profitable dealerships will be shut down.
The Way Forward will not be worth all the pain and suffering if what is left at the end is a company so slimmed down it is incapable of competing for business with its rivals in North America. Closing Lincoln, Mercury, Jaguar, etc. may be the logical quick fix but it would produce a company incapable of competing in the future.
However, this decision places an extreme premium on speed of change for Ford. Mullaly and Fields must jump start the development of great product to be sold under the brand names they have chosen for Ford's future. The next generation of Ford 500s, Mercury Montegos and Jaguar X types had better raise the bar significantly vs. their current offerings or The Way Forward will be just another name for the Path to Chapter 11.
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rwcmick 3:10PM (9/14/2006)
There is a misconception that killing a brand such as Mercury will save an auto manufacturer money. The trouble is, killing off a brand can cost huge amounts in dealer payouts and lawsuits. I beleive that I read somewhere it cost GM over a billion dollars to close down Oldsmobile when it was all said and done.
http://www.allcarsallthetime.com
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Andy 3:40PM (9/14/2006)
The solution is simple: kill of Lincoln and Mercury. Mercury is boring, uninspired, and has no energy in it. Lincoln is a joke, one only old folks buy into. The only promising vehicles from either bran is the Mariner Hybrid and the MKS. Giving up Aston-Martin is tragic, as the brand is the only sigh of continuous shining light Ford has had since the late '90s.
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Mike 3:22PM (9/14/2006)
Dump Mercury. Make Jag the upscale brand incorporating the best of Mercury and Jaguar. A/M becomes their Ferrari unit.
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PJ 3:23PM (9/14/2006)
In the short term, it may cost Ford money to kill off the Mercury brand. But I'd also be curious to know the ad/marketing budget allotted to Mercury in the past year. Considering how many times they've changed tack in the past decade, I'd guess any initial outlay would pay for itself in short order.
Michael, I actually like the idea of offering an "Art Deco" package on Fords as a consolation prize. Some Mercurys do look much nicer than their Ford siblings, most notably the Mariner.
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infinihertz 4:07PM (9/14/2006)
Totally agree with robert bell (#10). What Ford should do isn't completely wipe out brands, but instead refine them. For Mercury, slim it down to Milan, Mariner, a new Cougar and *maybe* a people mover like the Freestyle. Give Lincoln the MKZ, MKS, MKX, Navigator and possibly a Fairlane twin. Have Jaguar drop the X-type. And so on. Each brand can be successful; they just need clarity/focus.
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jstand6 4:12PM (9/14/2006)
Here are my thoughts on what Ford should do with its brands:
-Sell Aston Martin, Jaguar, and Land Rover
Jaguar, in particular, has been a drain on Ford's finances ever since they bought it. Plus, the Jaguar name has been tarnished by Ford's involvement, particularly with the Ford-based X-Type. The proceeds from the sale of the three brands will help keep Ford afloat long enough to survive the Way Forward plan. And different owners (European for best results) should help the British marques' image.
-Drop Mercury
Ford already has a step-up brand with Volvo. Lincoln suffers by having Mercury paired with it. The Lincoln-Mercury dealerships around here are pretty pathetic. They are barely good enough for buying a $20k Mercury, but they don't provide the premium experience for buying a $50k+ Lincoln. Use the money being poured into Mercury and use it to develop a proper V8 for Lincoln's upcoming flagship sedan, and redesign the Town Car. If the top-of-the-line Lincoln sedan is going to have just a V6 that can't even match up to a non-premium Camry or Altima, why have the brand at all? Lincoln needs to turn premium (vehicles and dealerships), and very soon. Lincoln needs the money a lot more than Mercury does. Instead of Mercury franchise buyouts, Ford should try to offer Lincoln-Mercury dealerships money to turn the dealerships into a premium store.
-Core brands: Ford (mainstream), Mazda (sport), Volvo (step-up), Lincoln (luxury)
Continue joint development between Ford, Mazda, and Volvo. The products that have been co-designed so far have been stellar.
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Steve J 4:56PM (9/14/2006)
Michael K: "They might not make sense under Ford ownership, but they do make sense. I think BMW could do awesome things with Jaguar. It would let them serve two markets with the same basic mechanicals, and thus they wouldn't feel the need to continuing luxing up the BMW brand."
This makes no sense to me at all. Jaguar would make even less sense as part of BMW's portfolio than as part of Ford's, IMO. Almost every car they make has a direct competitor in the other brand. Yes, BMW is a bit more sport than Jag, but they're hitting many of the same buyers as it is. It would be a real challenge to try to position both uniquely enough to make it worth having them as part of the same overall corporate structure. You'd have to turn Jag into something that runs counter to its heritage in order to have it not compete with BMW.
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JON 7:41PM (9/14/2006)
Maybe instead of cutting as many jobs and precious R&D they could stop funding and supporting groups that undermine the traditional american way of life with part of the purchase of your Ford vehicle.
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Merkur Mike 1:16AM (9/16/2006)
First, product is everything! The Mustang and Fusion are proof that great style leads to unit sales. The Five Hundred and Feestyle and Freestar are proof that uninspired design leads to uninspired sales.
Second, brand matters. The Mercury and Lincoln brands are beyond irrelevant. The Town Car is the only Lincoln that sells in volume. Since it is nothing but a streched Crown Vic, sell it through Ford. The Lincoln truck? Puhleeze. Mercury models? Quick. Name one that you just MUST have. Time's up. None? That's the problem in a nutshell.
Also, Ford should take advantage of its worldwide portfolio. For God's sake sell the European Focus in North America. Sell the Australian Falcon in the states. No small fuel efficient vehicles? What the hell are Ford selling in the UK? Europe? Get them over here ASAP!
For all the carping about Jaguar, it the brand is still valuable. For all the calls to kill the X-Type it is far and away the best selling Jaguar model. Kill it? Ridiculous! Sell Land Rover as Jaguar models and keep improving quality and performance.
Here's the mix for success... Ford stays as the mainstream brand, Volvo replaces Mercury as the step up brand and Jaguar replaces Lincoln as the premium/luxury brand.
There's not a Lincoln Mercury dealer that wouldn't kill to sell Volvos or Jags. Ford dealers would be equally happy to sell a Town Car instead a Crown Vic. Ford dealers would probably kill to have some of the small fuel efficient Eurpean models (just don't call them Merkur).
At the end of the day this would be a killer product mix with some overlapping price points yet clearly defined market niches. Once that is defined, Ford must never forget that the game- and market share and sustained profitability- is won on product. Never let the designers turn out another mediocre design like a Five Hundred. No amount of marketing- remember the commerical that demonstrated that the Five Hundred was taller than a Taurus- can overcome crap design.
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