DETROIT -- Ford Motor Co. could spend nearly $500 million to shutter its Mercury brand, CFO Lewis Booth said.
In an interview today with Automotive News, Booth said Ford took special charges of $247 million in the first half of 2010 to cover the cost of ongoing dealer reductions and shuttering the Mercury brand. He estimates the total cost to close the brand will be twice that amount.
About 700 of the 1,700 franchised Mercury dealers in the United States have signed agreements to close their stores in return for cash compensation, Booth said.
“The plan is in place and we're having very fruitful discussions with our dealers,”
Booth said. No dealer lawsuits have been filed against Ford related to the shutdown of Mercury.
Ford announced in June that it would discontinue the 71-year-old brand by Dec. 31 and focus solely on the Ford and Lincoln brands. It expects to sell off all Mercury inventory before year end. Ford plans to end production of the Mercury lineup in early October.