Lincoln Mercury maps success strategy
New leader hopes to steer division to recovery
By Mark Truby / The Detroit News
Daniel Mears / The Detroit News
DETROIT -- Ford Motor Co.'s Lincoln Mercury division changed strategies in the past three years about as often as most people change their oil.
The division moved to California to soak up cutting-edge car culture. The result: better weather, but worse communications with the home office in Dearborn.
The two American brands briefly rubbed elbows with Jaguar, Land Rover and Volvo after joining Ford's Premier Automotive Group, but were treated like unwanted party crashers.
One after another, grand plans to overhaul Lincoln Mercury have been scrapped. The only consistency has been sales declines and red ink.
Now new Lincoln Mercury President Darryl Hazel is determined to end this automotive identity crisis and steer Lincoln Mercury back to prosperity.
"Everybody wants to be something other than what they are," Hazel said Monday in an interview. "I want to be 100 pounds lighter. Lincoln Mercury went through the same thing. When you try to be someone else you get trashed. So now we are paying the price and we're on a remedial course."
Hazel, hired last year to replace miscast former General Electric Co. executive Brian Kelley, is setting what he believes is a more realistic course for the two brands. Lincoln and Mercury, Hazel said, are distinctly and exclusively American brands.
Lincoln Mercury's sales and marketing staffs moved back to Dearborn after a three-year stint in Irvine, Calif. And the division is back under the control of Ford's North America operations, which has simplified its product development and sales operations. Executives have shelved plans to sell Lincolns in Europe. Unprofitable models like the Lincoln Continental and Blackwood and the Mercury Cougar were whacked.
Hazel is counting on the stability to allow Lincoln Mercury to focus on improving dealer profitability and bolstering employee morale, which remains low compared to other groups of Ford employees, Ford officials say. Free from distractions, Lincoln Mercury has drawn up a credible plan to build new cars and SUVs over the next few years, Hazel said.
On Monday, at the North American International Auto Show, Lincoln unveiled the Navicross, a slab-sided crossover vehicle that combines the attributes of a sedan and a sport utility vehicle. Mercury, in turn, unveiled the Messenger, a sleek, angular coupe that has become one of the surprise hits of the show. Neither may become production vehicles in their current form, but they offer a realistic expression of what Lincoln Mercury can become.
"These are brands that badly need an identity," said Jeff Schuster, an analyst with J.D. Power and Associates.
While the show cars provide a glimpse of a better future, Lincoln Mercury must find a way to halt sliding sales and steep financial losses.
Lincoln sales dipped 5.6 percent this year, while Mercury's fell 15.6 percent. Hazel said his goal is to stop the sales slide this year. That won't be easy -- and turning a profit this year is far from a given.
"It will be nip and tuck," said Ford Group Vice President Jim O'Connor, who oversees Ford and Lincoln Mercury sales and marketing. "The losses will be substantially reduced. I won't know about profits until near the end of the year."
O'Connor said Lincoln Mercury probably will have to sell 100,000 units among its Lincoln Navigator, Lincoln Aviator and Mercury Mountaineer SUVs to have a chance to make a profit.
Lincoln Mercury plans to reduce its sales to rental car and other fleet buyers by 10 percent to 20 percent, Hazel said. The plan is to sell more cars and SUVs to individual buyers, a more profitable proposition.
The strategy calls for rolling out one all-new Mercury product per year for the next four years. The additions will include a new minivan, due out this fall, a small SUV, and two sedans. Lincoln Mercury's sales arm also plans to start pushing the venerable Mercury Grand Marquis large car. Once a steady profit maker, the Grand Marquis was virtually ignored by the company in the past two years and sales have suffered.
Last year, Lincoln was busy launching the new Aviator mid-sized SUV and revamping its big Navigator sport-ute and LS and Town Car sedans. While the products have been generally well-received, they don't look significantly different than the vehicles they replaced.
"We have a big challenge because they are new but they kind of look a lot like the ones we had before," Hazel said. "People want their neighbors to know they are in something new."
Hazel, in fact, concedes that Lincoln Mercury has a hard road to travel before it can churn out profits like it once did so reliably for parent Ford.
"We have a lot of issues," he said. "But we are no longer trying to be something that we're not. What we are is not bad at all if we do it right."
(Photo) The Mercury Messenger, unveiled Monday, was a surprise hit of the auto show at Cobo Center. The Ford division has had stable sales but financial losses in the past few years.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....