The meetings starting this week are for stand-alone Lincoln-Mercury dealers. In a letter to dealers, Ford Motor officials said they would share the business outlook and product plans for Lincoln and Mercury.
In July, Ford Motor said that it would keep the Mercury brand. A new small car will join the Mercury lineup, company officials said.
But one Ford insider told Automotive News that company executives want to make it clear to dealers that no major influx of new product is coming for Mercury. Struggling dealerships should not hang on with the hopes that an onslaught of new Mercury product will save the day, the source said.
Consolidation can strengthen dealerships by giving survivors higher sales. It also can raise transaction prices by reducing competition between nearby dealerships.
The company also needs fewer dealers because sales are dropping. Combined sales of Lincoln and Mercury fell to 299,909 last year, a 16.9 percent drop from 2003. This year, the two brands are down 21.6 percent through seven months.
Ford Motor began its dealership consolidation effort in summer 2006. In 2007, the number of Lincoln-Mercury stores dropped by 104, to 454 dealerships.
One Lincoln-Mercury dealer says Ford Motor's encouragement of Ford-Lincoln-Mercury stores ultimately will result in fewer sales for all three brands.
"We have consistently been opposed to the defeatist strategy first unveiled two years ago of dualing Ford and Lincoln-Mercury in metro markets," says Chris Lemley, president of Sentry Auto Group.
In most cases, the acquiring Ford dealer typically is "allowed to add Lincoln and Mercury in their existing facilities with little more capital investment or brand separation than buying a brand sign," he says. "This plan is bad both for most dealers and for Ford."
Sentry operates three Lincoln-Mercury dealerships in the Boston area.
Ford Motor officials declined to comment on the consolidation plans.