Ford Motor Co. hopes to wrap talks by year end with the dealers for the Mercury brand it is shutting to focus on its mass-market Ford and luxury Lincoln brands, CEO Alan Mulally said today.

Mulally declined to discuss the expected cost for phasing out the Mercury brand, part of a restructuring that includes an expanded investment in the Lincoln brand lineup. Mercury production is expected to halt in the fourth quarter.

“We don’t have a time frame per se, but we are hoping to help everybody through the rest of this year, that is the general time frame,” Mulally said after an appearance at the Chicagoland Chamber of Commerce annual meeting.

Company data showed that the broadly improved Ford brand vehicle lineup would meet the needs of Mercury customers, Mulally said of the decision announced last week to phase out the Mercury brand which was created by Edsel Ford in the 1930s.

Mercury has no stand-alone dealerships in the United States and some 1,436 of its 1,712 dealerships are paired in some way with the Ford blue oval brand that has been expanding. That leaves 276 Mercury-Lincoln dealerships that could become solely Lincoln dealers when the phase-out is completed.

“We have the vehicles that people really do want to cover the needs of the customers who were looking at Mercury before,” he said. “The entire Ford product line has moved up.”

Ford has reintroduced a small car to the United States this year in the Fiesta and will add a redesigned Focus compact car and a redesigned Explorer SUV to its brand lineup among other additions and investments. That leaves the Ford brand with a full lineup globally and within the United States, he said.

When it announced the Mercury closing, Ford affirmed its outlook for “solidly profitable” in 2010 and for its 2011 earnings to improve on 2010. It has not detailed the cost to wind-down Mercury or a specific earnings target.

“We have everything associated with what we are doing included in our guidance,” Mulally said.

Ford, which last year posted its first full-year profit since 2005, reported a first-quarter profit of $2.1 billion and raised its full-2010 outlook to solidly profitable. The automaker’s losses totaled $30 billion from 2006 through 2008.

Ford has been working for several years to reduce its dealership network, primarily in some metropolitan areas where consolidations would leave the surviving dealers with higher annual volumes.

“We are pretty much on track with our consolidation,” Mulally said. “We have a few too many dealers in some of the larger metropolitan areas, but we are continuing to work with all of our dealers including the Mercury dealers in a collaborative way.”

Ford has planned to tag iTunes support to some for the car that are to be produced this year. In automobiles outfitted with HD Radio receivers, people will be able to push “Tag” buttons on their displays, automatically saving the track data from on-air music. Once an iPod is docked with a car via Ford Sync, up to 100 tags will be transferable for future display in iTunes.

Tagged songs are usually intended to be bought through the iTunes Store. HD Radio remains a relatively niche technology, but is now said to be a choice for just under 2,000 radio stations in the US. Ford has not exposed which car lines will be bearing the tagging technology.

Also view our other posts related to Ford Cars

Ford has planned to offer its new car consumers the choice of turning their vehicle into a moving Wi-Fi hotspot in 2010.

The next generation Sync in-car entertainment system will use a USB mobile broadband modem to set up a secure Wi-Fi connection.

The system will be accessible in 2010 on selected Ford cars and will not necessitate users to take any additional subscriptions to mobile internet services � users will merely use their own USB Wi-Fi routers to get online. The Wi-Fi enabled models are yet to be established by Ford.

Shop and socialize in the car

“While you’re driving to grandma’s house, your spouse can be finishing the holiday shopping and the kids can be chatting with friends and updating their Facebook profiles,” said Mark Fields, Ford president of the Americas.

“And you’re not paying for yet another mobile subscription or piece of hardware because Ford will let you use technology you already have.”

Ford claims interest in in-car connectivity is rising swiftly, with one-third of people reviewed by the Consumer Electronics Association in the US wanting the alternative of being able to get online while in the car.