Platform-sharing pays off for Volvo S40 and Mazda3

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Ford Motor Co. has improved on its track record in its sharing of platforms among some of its different brands. Experts say that's an improvement over the automaker's Ford Division and Mercury models, which historically haven't been distinctive enough.

Ford Motor created two very different vehicles with the Mazda3 and second-generation Volvo S40, which share the same basic Volvo platform, says Jim Sanfilippo, exec VP at Omnicom Group-owned auto consultant AMCI. He calls the results "brilliant."

In addition, the Ford-branded Focus sold in Europe shares the same underpinnings as the Mazda and Volvo, says George Peterson, president of AutoPacific, who also lauds the results. "These are three unique and distinctive cars."

COOL DESIGN

The Mazda3 "doesn't look like a commodity," and it has a cool design with driving dynamics consistent with the brand, says Jim O'Sullivan, president of Mazda Motors North American Operations. "It's an economy car but doesn't feel like it." Mazda3 buyers have been in their 20s vs. the 41-year-old average buyer across the brand's entire lineup.

Independent Doner, Southfield, Mich., handles Mazda's advertising. The Japanese marque spent $89 million in measured media on the Mazda3 in 2004, according to TNS Media Intelligence.

The Volvo S40 is targeted at buyers with a median age of 35, younger than buyers of the first generation of the car who were in their mid to upper 40s.

A TV commercial from Havas' Euro RSCG, New York, showed the S40 racing in an Xbox videogame. The S40 was backed with $27 million in measured media in 2004, according to TNS.

Ford Motor has held a controlling stake in Mazda since 1996. Ford acquired Volvo in 1999 and Land Rover in 2000. It has owned Jaguar since 1989, but only got more involved in its operations in recent years. Land Rover, Jaguar and Volvo are in Ford's Premier Automotive Group.

Jaguar's entry-level luxury X-Type, which arrived in 2001, borrowed heavily from Ford's Mondeo in Europe. Although the X-Type, aimed at under-40 buyers, helped boost the marketer's U.S. unit sales to an annual record, the car hurt the Jaguar brand's exclusive image. Jaguar used the same montage of twentysomethings and music, Chris Isaak's "Wicked Game," to launch X-Type in Europe and the U.S. WPP Group's Y&R, New York, handled that execution.

"People saw it as a rebadged Mondeo," a Ford-branded car sold in Europe, says Edward Hellwig, senior editor at auto site Edmunds.com. The X-Type's styling wasn't as distinctively Jaguar as it could have been and the interior "didn't feel like a Jag," he says.

Mark Fields, chairman of Ford's Premier Automotive Group, says X-Type sales weren't sustainable because consumers are shifting from sedans to sport-utility vehicles, which Jaguar doesn't offer. But to compensate for that, Jag launched a sport wagon version of the X-Type earlier this year.

Ford Motor tapped the all-wheel-drive and suspension designs of Volvo's 70 Series and 80 Series for the new Ford Five Hundred and Mercury Montego sedans, which debuted last fall. Ford and Mercury previously didn't offer all-wheel drive models. Ford backed the Five Hundred with $62 million in measured media and the Montego with $12 million in 2004, according to TNS. WPP Group's JWT, Detroit, handles Ford Division, and Y&R, Dearborn, handles Mercury.

But experts say the Ford Five Hundred and Mercury Montego are too similar. Mr. Peterson says "they're pretty darn close." Adds Mr. Hellwig of Edmunds.com: "I don't see any reason why Mercury exists. The notion that Mercury gives people something different from Ford or Lincoln is lost on me."

INTERIORS, GRILL, LIGHTS CHANGE

But Ford is starting to make progress differentiating Ford from Mercury with different interiors, headlights and front grills, says Todd Turner, president of CarConcepts. He says Mercury's Mountaineer SUV was the first model in that unit to attract an entirely different buyer than its Ford Division sibling, the Explorer. Mercury is also attracting more female buyers to the brand with its more recent models.

Ford Motor's Earl Hesterberg, group VP-marketing, sales and service in North America, admits the two brands fish in the same pond for buyers. When asked whether Mercury models are too similar to their Ford siblings, he says "we're working on that." Consumers, Mr. Hesterberg says, "react to sheet metal-the top hat" or vehicle's exterior, along with its interior-all things they can easily touch and see. "I don't think most customers know or care" about platforms or components shared among models.

Mercury's Mariner SUV, a sibling to Ford's Escape and Mazda's Tribute, is starting to energize the brand, Mr. Hesterberg says. It's bringing younger people into showrooms, almost 40% of them new to the Mercury brand.

Mercury's broadened lineup is also attracting more women, Mr. Hesterberg says, adding that 60% of all Mariner buyers are female. He predicts the upcoming Mercury Milan, a sibling of the Ford Fusion and both sharing content with the new Mazda6, will bring more women buyers to Mercury. "We think a lot of people don't want a volume brand like Ford or Toyota," Mr. Hesterberg says, adding they're Mercury's target.

Strategy

Ford pushes comfort, confidence. Mazda adds zip to avoid economy car label. Volvo and Mercury tweak marketing to bring median ages down. Jaguar playing catch-up with late-to-game sport wagon.

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