I thought the Taurus and Sable were going away? I thought the Montego was replacing the Sable. Yet the Mercury website is now listing a 2005 Sable, as well as the Montego. I hope this means the recent news about their discontinuation is a nasty rumor.
They haven't been fully replaced yet. Next fall, the Ford Fusion and Mercury Milan come out. They are slightly smaller, and based on the Mazda6 platform. The Taurus/Sable will probably disappear soon after that.
Sable and Taurus are the low price point entry mid sized sedan. Probably mostly intended for the fleet market. Ford did the same sort of thing with the Escort when they introduced the Focus. The tooliong is paid for and until they need the manufacturing capacity for the 500 and its derivatives, they can keep building the Taurus and Sable for less. I doubt if they will continue past 2005.
The 500 was never intended to be a replacement for the Taurus, the 500 is a much larger vehicle, that is priced thousands below it intended cooperators vehicles like the new Buick, Chrysler 300 and the Toyota Avalon etc. The 500 pricing is even below the Camry, which is a smaller than the Taurus. The MSRP for a fully loaded AWD V6 500 is several thousands less than similar equipped FWD Camry.
Ford will still built the Taurus in all three trim levels, it is hardly intended only for fleets. Each will offer several former extra cost options as no charge equipment, worth two to three thousand dollars. Ford plans to build both the Taurus and Sable at Hapeville GA until at least the end of the 2005 calendar year, a few months after the 2006 Fusion, Milan and Zephyr come to market in August of 2005. If sales hold they will built them for one more year as a 2006.
I think you are going to have to define "much larger" for me. 2 inches longer and 1.5 inches wider, doesn't qualify for "much larger" in my mind. In fact Ford claims less front head room and less front leg room for the 500 than for the Taurus. The base price for the "SE" Models of both are within $1500 (the 500 is the more expensive). There are only two trim levels for 2005 Tauri, not "all three" (SE and SEL, no Limited). I think your claim that "The 500 was never intended to be a replacement for the Taurus" is not supported by the facts. The cars are similar in size and price.
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