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Merkur XR4Ti: The American Sierra and Ford’s Perfect Mistake
The Merkur XR4Ti was an award-winning, turbocharged home run for Ford in the 1980s—until it landed in U.S. dealerships with a thud. How could this have happened? As the latest episode of Revelations with Jason Cammisa reveals, it wasn’t a bad car that flopped in dealerships. No, the fault lies instead at the feet of the dealerships themselves.
In 1978, Ford’s European arm began working on a replacement for the Cortina, a four-door sedan that was getting long in the tooth. The sole mandate from management for the Sierra was that it had to be the most airflow-efficient car built by Ford anywhere in the world. The resulting car, which debuted in 1982, was a smashing success, grabbing nearly four percent of the total European car market at its height. (America’s best-selling car today, the Toyota RAV4, would need to increase its sales by roughly 30 percent to achieve that sort of market dominance.)
However, the European market wasn’t all that profitable, and Corporate began questioning why the European branch wasn’t making big money while rivals such as BMW, Audi, and Mercedes were. As Cammisa reveals, the secret to profits was the U.S. market, where a strong dollar meant big money now—and in the future.
The man who realized this was none other than Bob Lutz, the legendary auto exec who gave us some of the greatest enthusiast cars in history. He devised a program to start sending the Sierra overseas to the American market—but importantly, it would be an export program from Ford of Europe, not an import program for Ford’s U.S. business. That meant that Ford of Europe would be in charge of marketing, dealership selection, P.R., all that jazz. That was important because at the time, the domestic industry was known for, as Cammisa says when quoting a Car and Driver story, “its ability to take perfectly good European cars and transform them into mediocrities.”
But, because Oldsmobile owned the rights to the “Sierra” name in the U.S.—albeit spelling it as “Ciera,” Lutz’s team would need a workaround. To prevent folks from thinking the new car was “just a Ford” when its targeted competition wore BMW, Audi, and Mercedes badges, Lutz came up with a whole new brand: Merkur. (Be sure to watch the full episode to hear Lutz explain his reasoning and get in a joke about a popular hatchback that’s sure to make you chuckle.) The car, then, would be called the XR4Ti.
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The XR4Ti was the German-built, turbocharged, four-cylinder version of the Ford Sierra XR4i—a futuristically styled, rear-wheel drive, sporty coupe. With more power and more refinement than its European-market sibling—which was already a remarkable car itself—the Merkur was the better car.
Cammisa lays out a surprisingly short list of changes that were needed to federalize the car for the U.S. market, including a switch from the Sierra’s 2.8-liter V-6 to a revised version of the turbocharged 2.3-liter “Pinto” four-cylinder also seen in the Mustang SVO, Thunderbird Turbo Coupe, and Mercury Cougar XR7. Mated to a five-speed manual, the resulting engine was silky smooth and easily outperformed the E30-chassis BMW 3 Series, the Audi 4000 and Coupe, and the W201 Mercedes 190E. The XR4Ti even out-accelerated the contemporary Ferrari 308 GTB Quattrovalvole. Naturally, it was a quick hit with U.S. car magazine editors everywhere.
But not customers. And the reason? Ford Corporate didn’t listen to Bob Lutz (always a mistake), who wanted the Merkur cars to be sold through smaller specialty import dealers who had other franchises with brands like Saab, Volvo, or Porsche. Instead, gave Merkur to its existing Lincoln-Mercury dealers, who were ill-equipped and not incentivized to sell the small, expensive European premium coupe. Customers hated the dealer experience, and, well, the XR4Ti didn’t sell.
Meanwhile, in Europe, things got even hotter when the lineup grew to include the Ford Sierra RS Cosworth. With a Cosworth-built aluminum DOHC 16-valve head on a 2.0-liter version of that same Pinto block, it made 201 hp and left everything for dead—including and especially in various Touring Car Championships, where it eventually became so successful that it was banned pretty much everywhere. The final homologation Evolution model (the RS500) is, by at least one measure, the most successful race car of all time. And yet we never got the RS Cosworth in the U.S., partly because of how poorly the XR4Ti sold.
There are scores of other tidbits in this episode that make it worth watching in full, but there is one final truth from this episode that warrants putting to print whenever we can: Don’t second-guess Bob Lutz.
Well, that, and maybe avoid Cammisa’s plaid-clad dealership alter ego if you’re in the market for a new ride.
Mr. Cammisa’s take on the Merkur is pretty much spot on. We bought an ’87 XR4Ti in 1988, hoping to take advantage of the drastic final year styling change of replacing the bi-plane spoiler with a single wing. As it turned out, we needn’t have worried about being hoodwinked by a clever dealer – strictly on terms of the Merkur they couldn’t have found their own rear ends if you spotted them the use of both hands and a hunting dog. Anyway, we got a good deal on the car and still have it.
The XR4Ti isn’t perfect. As mentioned in the video the rear drum brakes and relatively weak front discs leave it somewhat under-braked. And the battery is almost right above the turbo so it tends to cook after a time. Despite this, it served as our main family car from “88 until we finally found a reasonable replacement in 2016. We kept the Merkur as my wife’s “toy” car. It doesn’t nearly as much use these days but now has about 290,000 km. on the odo. Another 9,000 km. and it will hit one light-second of use. The main upgrade it needs is that it’s still on its original turbo. With that mileage it takes quite a while to really spool up and until then it makes more noise than boost. So that’s on the list to do soon.
The last comment I’ll make is the name. I’ve lost count of how many times I’ve had to explain what a Merkur is. But I do have a good alternative to the XR4Ti. When they first came out, a friend’s wife saw one in traffic and misread the “4” as an “A”. So it is now better known as the “X-Ratty”.
I’m reminded of being involved with Chevrolet Racing in IMSA GT-O when Jack Roush and Ford came out with their version of this car. We referred to it as the “XRV8-N/A” because Joe Public couldn’t go to any Lincoln-Mercury dealer and buy a V8 Merkur. It led our group to briefly campaign a turbocharged small displacement Camaro before the sanctioning body put a stop to all of our shenanigans. Fun times!
I don’t know Lutz and can’t access his character. However from everything I read he does seem to be at least tainted. That top of the corporate ladder environment where if it was a success ‘ That was all me! All hail me!’ if it failed point the finger elsewhere . Iacocca was a master at that,- ‘ I never made a wrong move. Had they only listened to me. ‘ – propaganda. . The Buck Stops Here sign was never on that desk. _ Maybe The Mercurs would have sold better if in other independent dealerships. However claiming that was only because they had to compete with bigger luxury models isn’t the case. You had models like the Lynx, Topaz, and the Capri on the floors at the same time as well._ And if Cammisa honestly believes that the XR-7 was called the XR-7 because size wise it would have to be numerically higher, there’s a whole bunch of 67-68 Cougar owners who might want to chat.
During the production run of the Ford Sierra in South Africa, Ford South Africa produced a limited edition of the Sierra that they called the XR8. The XR8 featured a Ford 302 V8 and suitably upgraded drivetrain that was produced in the required quantity to allow the car to be homoligated for local racing.
It would be interesting to put the XR8, XR4TI and the various Cosworth versions together for a comparison.
While living in South Africa at the time, I had a GLE version of the Ford Sierra that used the 3.0 Essex V6 carbureted engine instead of the 2.8 Koln engine used in the European versions.
The XR8 designation used by Ford South Africa doesn’t seem to fit the explanation of the “XR” designations as it relates to vehicle size as put forth in the video.
You could also buy V-8 Capris , the ‘Perena V8 ‘ in South Africa during the early 70s. A Ford authorized program sold at their dealerships. Maybe the XR8s spiritual successor.
What about the other Merkur? Jason forgot all about that and apparently so did FOMOCO as I havent seen one in Decades. This motor was terrible on turbo lag and if you want proof, drive an SVO.
I had an ’87 XR4Ti which I almost literally “stole” from the dealership. Great car, but it had quirks. The first to second shift was slow, the belts squealed when running the AC, and the rear drum brakes sucked.
Enter the accessory company, Rapido Group.
Rear brake conversion kit, belt pulley kit to fix the AC, and the “SVO calibration kit” to upgrade the hp from 175 to 225. Add in a few minor suspension bits, and the XR4 became a little ripper. Rapido bent my Visa card just a little, but the results were worth it.
My buddy had a Saab 900 turbo at the time. He used to rag on me about how his Saab was way better than the XR4, until I let him drive the XR4. Never heard another peep from him about the Saab after that test drive.
The XR4 was a fun car. I was sad to retire it after 150k miles.
Man these were fun cars, Going to high school in the mid 90’s the 5.0 Mustang was among the cool cars to have. A friend’s XR4Ti with extra boost and a few other tweaks was quite the handler.
Would make a nice cars and coffee car!
I loved these things,s till do. I do remember as a kid going to the Lincoln-Mercury dealer they did not want to be bothered with these things. They were all about Town Cars and Cougars and had no idea what this strangely spelled Mercury was.
I remember looking at these when they came out and concluded they were much too expensive. How many people wanted to spend way more for this than a Buick GN or the aforementioned Cougar XR7?
Jason- great job on 2 great cars. I bought my XR4ti in 12/85,knowing it had won Road and Track’s European car of the year award. My dealership in Denver was “all in” for the Merkur. I ate up my first engine in 1999 and knew of Jack Roush’s success in Trans Am racing and the unbelievable success of the Ford Sierra Cosworth in touring car competition. After consulting with the Rapido group in Oregon, Jack Roush’s team and with Cosworth, we upgraded the car with Roush’s suspension package, bigger disc all around, the Cosworth aerodynamics, a high performance engine from Modern Performance,bigger turbo and intercooler,etc. etc. I absolutely love the car, making around 350hp and this wonderful “old school” turbo lag and boost.
Doc – good on you. I’m jealous. But it is a bit of a ‘Catch 22’. Too many of these cars received the too available ‘performance upgrades’ by kids at the time who had no idea what they were doing. Shoddy work. More harm than good. Finding a relatively clean unmolested example became next to impossible. The XR4Ti ‘s problem was that it was too good for it’s own good.
Paul- that is why I first invested a lot of time speaking to the organizations that had raced the car and knew it the best, then I made the investment on their recommendations . In addition to the aformentioned improvements,I also did new paint and leather interior. Prior to the rebuild, I had the good fortune of driving a Ford Sierra Cosworth RS500. It was good but not great. I went to a higher level of fun.
I don’t remember that 2.3 turbo being described as “silky smooth” in-period, unless “coarse” is a synonym.