It's now official: Ford will phase out its Mercury division by the end of 2010. With all of the company's main decision makers on board -- including key members of the Ford family that controls 40 percent of the voting stock -- Ford of the America's President, Mark Fields, used the annual spring business and product review to announce that production of Mercury vehicles would be halted sometime during the fourth quarter. The news, which confirmed earlier rumors from obviously well-placed inside sources, came a month earlier than expected.

At the same time, Fields indicated that the premium Lincoln division would benefit from this strategic realignment of resources and expand its lineup with seven new or heavily revamped vehicles during the next four years. One of them will be a new compact model based on Ford's totally redesigned 2011 Ford Focus. That vehicle, which originally was to have worn a Mercury badge, will become Lincoln's first-ever C-segment offering.

The writing had been on the wall for some time with Mercury, established in 1939 by Edsel Ford as a step-up brand for buyers on a sub-Lincoln budget. In 1978, its best-ever year, Mercury sold 579,498 cars. In 2009, that number was 92,299. Of Ford's current 16-percent U.S. market share, its struggling "tweener" division accounts for a mere 0.8 percent, a stat that has been holding steady to declining during the past few years. Although there are currently 1,712 Mercury dealers in the U.S., none exist as stand-alone operations. Over 500 are dualed with Ford and more than 900 outlets sell all three FoMoCo brands.

As for the immediate future, Fields went on to note that: "We are 100 percent committed to supporting Mercury owners through Ford and Lincoln dealerships and working hard to keep them as valued customers in the future. At the same time, we will work closely with our dealers to phase out Mercury franchises and continue to build a healthy, growing Lincoln with strong new products and a profitable dealer network that delivers a world-class customer experience."

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