Ford has promised that the Mercury brand will live on in a way that sets the marque apart from it's Blue Oval-badged siblings. Many Autoblog readers have commented that Ford should utilize its European models to meet this end, and all indications are that you were right on. Ford has said that the next all-new Mercury would come in 2010, and Ford of Europe CEO John Fleming told Automotive News that the vehicle will "likely" be designed and engineered in Europe. The reason for Mr. Fleming's confidence comes from the fact that the new vehicle will be based on the Ford Focus platform, and that vehicle architecture will, for the foreseeable future, be developed overseas.
Ford of Europe currently builds the C-Max, the three-, four-, and five-door Focus and the Kuga off the C-platform, meaning any one of those variants could one day wear a Mercury waterfall grille. While it would essentially still be a rebadged Ford, this new Merc will be a slightly reworked version of a vehicle that won't otherwise be sold stateside, so it will be new to us. That sounds a lot better than the Mercurys we have today.
[Source: Automotive News, sub. req'd]