Does the new LM Strategy Make Sense?

[wescoent]

It looks like Ford is finally settling on their new plan with Lincoln-Mercury, namely by turning Lincoln into a volume brand. For years, Mercury was the volume brand while Lincoln sold a Continental/Town Car and a Mark coupe. Now the Lincoln volume is being turned up a notch with many new models on the way:

 

-MKZ entry level luxury sedan

-MKX entry-level sportwagon crossover

-MKS midlevel luxury sedan

-Navigator/Navigator L

-Lincoln 3-row crossover

 

On top of this, there are three other models rumored to still be in the works. A Lincoln RWD sports sedan to slot between the Zephyr and MKS, a RWD coupe to act as a halo car, and a large AWD sedan to slot above the MKS and to truly replace the Town Car.

 

Mercury on the other hand, while it does have a very new and hot showroom, is looking to have product issues in the near future:

 

-Milan is doing well

-Montego is getting a major update in a few months, but otherwise has been a slow seller to date

-Mariner is also doing well for the moment, and is getting a full redesign soon

-Grand Marquis is dying a slow, painful death, which is a problem for Mercury volume

-Mountaineer is hanging on, but in a dying segment, with no replacement on the way

-Monterey is dead in the water, with no replacement in sight

 

At this point, Mercury has the Milan and Mariner going for it, as well as a great advertising campaign that has returned the brand to relevance after all these years. They also have a chance if the Mercury Magellan Freestyle-clone is still in the works, and if the Grand Marquis's '08 redesign is as extensive as some have said.

 

Another big chance Mercury would have to greatly increase volume would be to get in on the C2 project while it's still in development, and get a C-segment car. It could be built alongside the Focus, but to European-specification with a ritzy interior and a convertible model.

 

Personally, I feel Mercury needs more product, and that there has to be at least ONE sporty product in the showroom. Any thoughts?

Edited August 14, 2006 by wescoent

[silvrsvt]

The problem is that Lincoln isn't really getting any new product, outside the MKZ and the people mover...the MKS is really a LS/Continental replacement and the Jury is still out on the D386, which is the larger D3 sedan that the MKS is based on and will most likely be the true TC replacement. Lincoln is/was in worse shape then Mercury when it comes to product.

 

As for Mercury, I think Ford has to figure out excactly how they want to slot them with Lincoln sharing the same lot. I think the biggest area they are lacking is in the crossover segment, which may or may not see the Freestyle changed into a Mercury. I think it might be pointless to have 3 different vechicles that are more or less the same such as Mercury MKX/Edge, if it doesnt offer anything different besides a different interior and a different nose/rear end. I think a C2 based Convertible would be a major coo for the brand, since it wouldnt take Mustang Sales away and would appeal to women that Mercury is going for these days.

[Traveler]

Perhaps the reason Lincoln is becoming more volume-oriented is that Ford continues to have concern over Mercury's future as a whole. If Mercury turns around, great...all the more profit for Ford. If it doesn't and they have to take measures to trim, they have laid out Lincoln to be more approachable to the average consumer and hopefully lowered the median age of buyers.

Edited August 14, 2006 by Traveler

[g48150]

Check this out, AND mark my words, some other company, OTHER than Ford will be designing AND distributing Mercury as a niche brand. All the "hard" work, manufacturing and marketing, will be done by Ford, AND get this, Ford will be the one on the hook for warranty.

 

I keep saying this and no one cares, MF is a genius!!!

[Roadrunner]

I like Traveler's evaluation of this.

 

Otherwise, I'd say they're snorting llelo 'cause Lincoln would be hurt a bit to make it a volume leader - dumbed down to Buick/Mercury levels.

[2b2]

Interesting, but I'm not sure any non-insider knows what L-M's strategy is...

 

I'm glad they seem to be getting away from trying to do almost everything in threes. And so glad they hired Jill Wagner - maybe that's all Lincoln needs - wonder what Jill's mother looks like?

 

Mercury is the middle of their lineup but was left hollow way too long - FML finally has a chance to no longer be a "corporate-donut". I've said Mercury has to be 'the best cars', then Fords could de-contented versions & Lincolns could add padding+chrome+gadgets... Now Mercury IS the highest rated American car brand! (J.D. Power VDS) Will they build on that or mess it up? lessee

 

Lincoln = volume, Merc = not so much?

I don't buy it. How many people budget 'Lincoln-ly'? ...maybe compare Toyot & Lexoid sale numbers? Short of ignoring potential customers, flooding Lincoln & starving Merc (ie deliberate sabotage); the lower priced 'rebadge' will outsell the higher priced one.

 

no Meta-One

but maybe a Montego wagon?

and then a S-Maxish Milan-based monospace-wagony-vanny thingie?

 

Mercury C2

That's been my dream for some time now:

coupe - XR3

cabrio - Capri

sedan - Milanetto

vanlet - Microspace

 

<<pretend my Panther Mafia Manifesto is here>>

 

sport-Merc

'nother dream:

plus-sized RX-8 chassis wrapped around the 3.5v6, na & turbo

 

crazy idea

Wonder if re-bundling the dealerships into Mercury/Mazda & Lincoln/Volvo would work? ex: I believe the Milan would be selling even more if the salespeople didn't have the MkZep to upgrade their commissions with.

Edited August 14, 2006 by 2b2

[Footballfan]

At the risk of being attacked here, Mercury and Lincoln at the present time is a joke. In essence, LM dealers are selling upmarket versions of Ford vehichles in most cases. Mercury is trying to appeal to a younger crowd, but most Montegos and Grand Marquis I see are being driven by retirees.

 

As I mentioned in previous posts, Ford should do one of two things: Make Mercury and Lincoln cars uniquely different than Ford-branded vehichles- meanding that ZERO sheet metal is shared between Ford, Lincoln, and Mercury vehichles. This may mean Lincoln going to all rear-wheel drive, but so be it.

 

As the above scenario is not likely to happen, drop Mercury and replace it with Mazda. Mazda has fresh, exciting product across the board, and it has in its palm the exact demographic that Mercury is trying to hit. Spend the marketing and product dollars from Mercury on Lincon and Ford. Even add Volvo to the LM dealer mix. The direction that Lincoln is going has that brand abutting Volvo. Reposition Lincoln to be traditional American luxury- bold, styling, and big. Volvo and Mazdas can be built in plants Ford has slated to close, and therefore it would be a win-win all the way around. Mazdas and volvos sales could double, LM dealers would be successful again, and people's jobs would be saved.

[silvrsvt]

Check this out, AND mark my words, some other company, OTHER than Ford will be designing AND distributing Mercury as a niche brand. All the "hard" work, manufacturing and marketing, will be done by Ford, AND get this, Ford will be the one on the hook for warranty.

 

I keep saying this and no one cares, MF is a genius!!!

 

 

I'm not sure what your getting at here...basically Mercury will be done by say Mazda, but Ford does all the manufacturing and Marketing?

[ZanatWork]

As I mentioned in previous posts, Ford should do one of two things: Make Mercury and Lincoln cars uniquely different than Ford-branded vehichles- meanding that ZERO sheet metal is shared between Ford, Lincoln, and Mercury vehichles. This may mean Lincoln going to all rear-wheel drive, but so be it.

 

 

Errrr....I can't name anywhere in the marketpolace this strategy makes a lick of sense.

 

The two biggest media darlings-Toyota and Honda-have both made stacks of money be cleverly sharing platforms, engines, and even sheetmetal among its offerings. As much as I'd love Mercury to become the Ford of Europe brand or Lincon to maybe go all rwd...all that would do is increase costs across the board and leave Ford juggling more platforms and suppliers than their competition.

 

I'll agree that Mercury could be better utilized...but I don't think that wild differentiation is needed. I would suggest that Mercury get a version of the S-MAX and get the Meta One spun up when the Freestyle makes way for the "Fairlane".

[Traveler]

At the risk of being attacked here, Mercury and Lincoln at the present time is a joke. In essence, LM dealers are selling upmarket versions of Ford vehichles in most cases. Mercury is trying to appeal to a younger crowd, but most Montegos and Grand Marquis I see are being driven by retirees.

 

As I mentioned in previous posts, Ford should do one of two things: Make Mercury and Lincoln cars uniquely different than Ford-branded vehichles- meanding that ZERO sheet metal is shared between Ford, Lincoln, and Mercury vehichles. This may mean Lincoln going to all rear-wheel drive, but so be it.

 

As the above scenario is not likely to happen, drop Mercury and replace it with Mazda. Mazda has fresh, exciting product across the board, and it has in its palm the exact demographic that Mercury is trying to hit. Spend the marketing and product dollars from Mercury on Lincon and Ford. Even add Volvo to the LM dealer mix. The direction that Lincoln is going has that brand abutting Volvo. Reposition Lincoln to be traditional American luxury- bold, styling, and big. Volvo and Mazdas can be built in plants Ford has slated to close, and therefore it would be a win-win all the way around. Mazdas and volvos sales could double, LM dealers would be successful again, and people's jobs would be saved.

 

 

Obviously Ford has depended quite a bit on platform sharing for years as does GM and Chrysler. Heavily investing into making Mercury or Lincoln products competely different would be expensive and probably extremely risky considering their loss of market share over the years. However, a good example of variation is the Charger/300 comparison. Park both beside one another and they look considerably different, even though they share more than meets the eye to the average buyer. Of course, the interiors are much more similar than their exteriors. I'm sure that Ford can create modest variation in sheetmetal but Lincoln can not be BMW or Mercedes. Notice that most domestic vehicles that are uniquely different are built on a niche line in limited quantities for only a short period of time. The nature of Ford is to produce afforable, mass-produced cars and when you can get by with only front and rear clip changes, throw on different wheels and upgrade the interior with more standard features, it allows for a more unique product while making it profitable to produce. GM does it with Chevys, Saturns, Buicks and Cadillacs mix-matching engines, fenders, variations of wheel designs, small interior trim pieces, etc.

 

I also don't really think Ford could get by producing Mazda and Volvos on their own turf. There's probably a lot of intercontinental politics involved.

[OrlandoGuy80]

Here's my take: Ford has no intention of dropping the Mercury brand. Instead, they say they are going to make Lincoln the volume brand at L-M dealerships. This essentially means, "we are going to remake Mercury into a high-volume niche brand, so we HOPE Lincoln becomes the volume brand of the two."

 

I agree that it would be too costly to make Mercury into "Euro-Ford of North America" (unfortunately). Mercury will probably always be Ford's third priority, behind Ford and Lincoln, because the possibility to get bigger returns from those two brands is greater.

[630land]

"In essence, LM dealers are selling upmarket versions of Ford vehichles in most cases. "

 

Umm, I think this has been done since Henry Ford 1 was alive.

[Mark B. Morrow]

Interesting, but I'm not sure any non-insider knows what L-M's strategy is...

 

I'm glad they seem to be getting away from trying to do almost everything in threes. And so glad they hired Jill Wagner - maybe that's all Lincoln needs - wonder what Jill's mother looks like?

 

Brilliant!!! Jill's Mom is still much younger than Lincoln's current demographic.

 

 

 

no Meta-One

but maybe a Montego wagon?

 

Absolutely correct. Call it a wagon. That is what people want. Enough of the silly acronyms.

 

Mercury C2

That's been my dream for some time now:

coupe - XR3

cabrio - Capri

sedan - Milanetto

vanlet - Microspace

 

<<pretend my Panther Mafia Manifesto is here>>

 

sport-Merc

'nother dream:

plus-sized RX-8 chassis wrapped around the 3.5v6, na & turbo

 

crazy idea

Wonder if re-bundling the dealerships into Mercury/Mazda & Lincoln/Volvo would work? ex: I believe the Milan would be selling even more if the salespeople didn't have the MkZep to upgrade their commissions with.

 

Great suggestions, How about a Merc version of the Mazda 6 wagon?

[RichardJensen]

Ford has been encouraging LM dealers to pick up Mazda franchises where possible. Mazda's dealership network is a quarter the size of Ford's.

[Edgey]

I think the goal is to invest more into Lincoln since Ford lacks a strong presence in the entry-level luxury field in North America. This is where the most growth has been and will be so it's important that Lincoln's products compete in the price-points formerly occupied by Mercury (which is not perceived as a luxury brand). I'm sure Mercury is going nowhere, but it may become increasingly irrelevent to try and maintain them as Lincoln's crutch. Lincoln should be able to stand on its own once it sells enough cars in a wider array of categories.

Edited August 15, 2006 by Edgey

[ANTAUS]

What he said, Times 2.... I agree.

[RichardJensen]

I think the goal is to invest more into Lincoln since Ford lacks a strong presence in the entry-level luxury field in North Ameridca. This is where the most growth has been and will be so it's important that Lincoln's products compete in the price-ponits formerly occupied by Mercury (which is not perceived as a luxury brand). I'm surey Mercury is going nowhere, but it may become increasingly irrelevent to try and maintain them as Lincoln's crutch. Lincoln should be able to stand on its own once it sells enough cars in a wider array of categories.

Hadn't thought of that. Lincoln looks to be parked smack dab in the middle of the fastest growing section of the luxury market.

 

I think volume growth over the next few years will come from the Lincoln side of things, but I don't think that we will see anything, except Lincoln moving to roughly equal Mercury sales.

 

Mercury.............. What happens to Mercury? I don't know. I'd like to think we get some idea in Detroit this January. I think that they will continue to pursue a Lincoln-lite design strategy. Upmarket, but not -that-upmarket. More satin surfaces, finer detailing, but not Lincoln level luxury. The feminine Ford, as it were, or the 'metro' Ford.

 

Keeping Mercury and Lincoln (like keeping Jaguar, Land Rover, and Aston Martin) really doesn't add a lot of overhead. All Ford NA brands are run by the same sales unit, ditto Ford's British PAG units. Engineering and PD budgets aren't dramatically strained, as Ford has FINALLY rationalized platforms (and powertrains between Jag and LR). Ad budgets cost more only in the fractional costs of production. Ask anyone--media buys are where you really blow your money, and there Ford still gets volume discounts. Even if they're buying six Ford ads, 1 Mercury, and 1 Lincoln.

[Edgey]

Somebody agrees with me! Wait until they hear about this back home!

 

The other defense of Mercury is that a large share of its customers are 'conquest sales', meaning that people buying Mercurys are trading in non-Ford vehicles. However, Lincoln will find it is doing the same thing since it will be selling a lot more cars to people it has never been able to sell cars to before. The Zephyr and MKX are definitely the conquestadors in the Ford lineup, they are there to carve out a share of the pie. The MKS should appeal to Lincoln traditionalists, which I'm sure they are eager to hang onto as long as they can. Still, as has been mentioned, Lincoln really isn't packed with product and won't be anytime soon so Mercury is going to be a neccessary supplement.

Edited August 15, 2006 by Edgey

[fllcobra]

Having spent a lot of time over the past year and a half at Ford, Mercury/Lincoln dealerships, I can see a clear strategy developing at Ford. There are basically two kinds of customers. There are the ones looking for the best value, and then there are those that have disposable income and are looking for bling. And not just any luxury car but an AMERICAN luxury car.

 

That is why Ford needs Lincoln. Period.

 

A Mazda take over of Mercury would be retarded and would completely abandon loyal "buy America" customers who want a fancier interior and more unique styling that the dime a dozen stripped down look that Ford badged vehicles are known for.

 

Add to it that Lincoln has carved a niche for itself with regards to its interiors and Ford is moving to capitalize by expanding that success. Ford is no more guilty of rebadging now than Toyota/Lexus or Honda/Acura. Parts sharing keeps costs down and margins high. Its basic business 101.

 

Ford is definitely on the upswing and with the aggressive push on standardizing the state of the art safety features, offering a longer warranty and lowering prices will improve sales and resale value of its cars.

[RichardJensen]

Ford is definitely on the upswing and with the aggressive push on standardizing the state of the art safety features, offering a longer warranty and lowering prices will improve sales and resale value of its cars.

This, not a RWD wunder car, is how you rebuild a company that sells 3M units a year.

 

You also develop a customer centered philosophy that maximizes customer satisfaction with the entire package (everything from quality to the customer's desired 'bling' quotient), while maintaining sustainable production volumes.

[goblue93]

This, not a RWD wunder car, is how you rebuild a company that sells 3M units a year.

 

You also develop a customer centered philosophy that maximizes customer satisfaction with the entire package (everything from quality to the customer's desired 'bling' quotient), while maintaining sustainable production volumes.

 

In addition, fully realized product segmentation is crucial. Having a good product available at every pricepoint from small to large, inexpensive to luxury, in cars, trucks, CUVs, and SUVs throughout all of the brands will be the big step. There have been too many holes in the lineup with neglected and missing product but they are headed in the right direction now.

[Footballfan]

"In essence, LM dealers are selling upmarket versions of Ford vehichles in most cases. "

 

Umm, I think this has been done since Henry Ford 1 was alive.

 

Sorry but guess again. Look at Mercury and Lincoln up until the mid 1990s- there was a clear distinction sheet metal wise between a Continental, Taurus, and a Sable; a thunderbird, Cougar, and Mark VII; even the Crown Victoria and Grand Marquis had unique quarterpanels to separate them.

 

Look at LM's lineup today:

 

Milan- a mildly restyled Fusion

Montego- a rebadged 500

Mountaineer- a rebadged Explorer

Montery- a rebadged Freestar

Mariner- a rebadged Escape

Grand Marquis- a rebadged Crown Victoria

 

Zeypher- a mildly restyled Fusion

Navigator- a rebadged expedition

Mark LT- a rebadged F-150

MKX- a nildly restyled Edge

 

The only car in LM's lineup that is signifficantly different than Ford's is the ancient Town Car.

 

Even GM, with all its problems, can clearly differentiate a G6 from a Malibu; a Grand Prix from an Impala from a LaCrosse; a DTS from a Lucernne.

 

Get my drift?

 

Having spent a lot of time over the past year and a half at Ford, Mercury/Lincoln dealerships, I can see a clear strategy developing at Ford. There are basically two kinds of customers. There are the ones looking for the best value, and then there are those that have disposable income and are looking for bling. And not just any luxury car but an AMERICAN luxury car.

 

That is why Ford needs Lincoln. Period.

 

A Mazda take over of Mercury would be retarded and would completely abandon loyal "buy America" customers who want a fancier interior and more unique styling that the dime a dozen stripped down look that Ford badged vehicles are known for.

 

Add to it that Lincoln has carved a niche for itself with regards to its interiors and Ford is moving to capitalize by expanding that success. Ford is no more guilty of rebadging now than Toyota/Lexus or Honda/Acura. Parts sharing keeps costs down and margins high. Its basic business 101.

 

Ford is definitely on the upswing and with the aggressive push on standardizing the state of the art safety features, offering a longer warranty and lowering prices will improve sales and resale value of its cars.

 

Even if you drop Mercury, the American loyalists could still gravitate to Lincoln (even though the Milan and zeypher are built in Mexico) It would not turn me off; I am one of those "buy American" customers. I would gladly buy a Michigan-made Mazda as opposed to a Mexican-made Zeypher/Fusion.

 

Parts sharing, fancy interiors, and extended warranties are OK for a lower-priced brand. However, when I think of "Mercury" and "Lincoln" I expect something more. Remember when Ford was poking fun at GM in the 1980s with their look-alike styling on the Buicks, Cadillacs, and Oldsmobliles? My have things come full circle.

 

Parts sharing is OK- in engines, drivelines, interiors, glass, and other parts that the customer does not see. However, styling- in LM's case unique styling- is what is going to get me in the door!

[Watchdevil]

Sounds like Mercury could die a slow death... It needs to be more than Ford's rebadged and regrilled with a barely higher sticker price.

 

Mercury could be reformulated to feature cars not shared at all with Lincoln or Ford... They could use a revived Cougar and a Euro Focus Cabrio as maybe a Capri at this point. They vehicles they have now are just duplicates of other Ford models. Consumers don't seem to care about Mercury as it is now. It's existance now seems to be only for accommodating Lincoln Mercury dealerships so they will have models equal to Ford to sell. Seems like Mercury could be made the Saturn of Ford if they wanted to...

 

Lincoln just needs to go on a path of a few vehicles, not a whole line almost equal to Ford. A Zephyr, Continental, Mark IX convertible, Navigator, Aviator (not called an MKX) and Mark LT is all they really need with really distinct Lincoln styling seperate from Ford and nothing that is an import poser.

[silvrsvt]

Sorry but guess again. Look at Mercury and Lincoln up until the mid 1990s- there was a clear distinction sheet metal wise between a Continental, Taurus, and a Sable; a thunderbird, Cougar, and Mark VII; even the Crown Victoria and Grand Marquis had unique quarterpanels to separate them.

 

A different C pillar isn't going to make or break a brand, which was the primary difference between the models you listed above, esp when you take your Ford and Mercury brands and park them next to one another.

 

Yes Lincolns where differentiated more then their F/M counterparts, but what would you rather have? Less/older product because it costs more to have unique sheetmetal stampings or More newer product that shares more sheetmetal with other products? Given Ford serious product fuck ups steming since the late 1990's when it came to cars, Ford is doing best it can right now till it can right the ship.

 

No matter how you break it down, L/M products have always been based on Ford platforms for the past 20-30 years

[Hemiman]

Not sure where Ford is headed with L/M. They got themselves into this pit through many years of neglect. It'll take inspired leadership and many yrs to get them out.

 

Ford: Seems to me that Ford doesn't have faith in its North American design capabilities.

Let's face it, all new Ford cars are going to be based on Mazda or Volvo engineering, (Mustang is an exception to this). I'm not saying this is bad, but it is somewhat saddening.

 

Mecury: Now, if Mazda Volvo, and Ford can share a platform, and still look unique, why cant Merc? You folks are right when you say that Mercs have always been gussied up Fords, but until recently, they were usually given some unique sheet metal and even some Merc only engine options, (the 410 FE is a good example). Yes, we all like to joke about GM's 80's & 90's folly in badge engineering, yet here Ford is, making the exact same mistake! "Inabillity to learn from your enemy will ensure your own defeat". Yes, unique sheet metal would still require it's own tooling, but Merc only engines could be as simple as a hotter calibraition of the ECM.

 

Lincoln: I believe Lincoln has to be more than Ford's Buick, (that's Mercs job). Lincoln used to define what an American luxury car was. Well, it's lost that status & it seems that Ford is intent on dumbing the brand down to Buick level, (where does that leave Merc)? Again, since Ford seems to have lost faith in it's NA engineering abilities, where will Lincoln draw expertise from? Mazda & Volvo? not if you want Lincoln to be a unique premium product. I would like to see Lincoln bsaed on Jag. Yes, I know it's been done, and many of you consider it a failure. But was it? It produced the best American built sedan ever. Had the LS been managed just a little bit, it would have been a segment leader. Additionaly, this platform sharing could help offset some of the high overhead at Jag helping both brands out.

 

Better yet, why not let NA design Lincolns Ford has had some knock out concepts. It seems we're up to the task so why not let Lincoln be the premere AMERICAN luxury car.

 

Yes, I know I've provided very little detail, since I'm typing this at work, my boss would frown upon my spending too much time goofing off on this forum.