Ford announces requirements for Lincoln dealers to survive

When Ford Motor Company announced that they would end the Mercury brand at the end of the 2010 calendar year, it was expected that some of the nation’s Lincoln-Mercury dealers would not be able to survive after the demise of the middle-child brand. When the announcement was made last year that Ford had big plans for Lincoln dealerships, there were over 500 locations in the top US markets where you could buy a new Lincoln. That number has been reduced to 434 now and the company plans to cut that number to around 325 by the end of 2011. FMC believes that by cutting the number of dealerships, consumers will naturally go to the next nearest Lincoln dealership, thus increasing the profitability of the dealerships that do exist.

For those Lincoln dealerships that wish to remain as one of the 325 luxury dealerships in Ford’s 130 top US markets, Ford Motor Company will send out more specific requirements but for the time being, they have offered four simple guidelines.
- Offering a dedicated Lincoln staff, including a dedicated service manager and sales staff in place to handle the luxury brand

- Having only the Lincoln brand displayed on the dealership’s signs and buildings. This means removing the Mercury logo from many of the Lincoln-Mercury dealers

-Offering certified pre-owned vehicles to the tune of at least 30% of total used inventory

-Offering “owner privileges”, which includes providing free car washes and loaner vehicles for Lincoln owners who bring their vehicles in for service

None of these four preliminary requirements are that extreme but smaller dealerships who are already struggling since Mercury was disbanded may have a hard time keeping up with the larger shops. Dealerships that are unable (or unwilling) to meet these requirements by October 1st will be expected to sell their Lincoln franchise back to Ford Motor Company. Those who try to refuse will have their dealer discounts reduced – further making profitability unlikely.

Overall, there are around 1,100 dealerships in the country selling Lincoln products but Ford’s immeadiate goal is to thin the number of dealerships in the most popular and competitive locations around the country. TorqueNews.com will continue following the progression of the Lincoln brand as dealerships work through their first year without Mercury.

Source: The Automotive News

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