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Where Is Ford taking the Lincoln Motor Company?

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  • gregg_vwgregg_vw Posts: 2,415
    The jury is out as to whom needs to take a chill pill here. Fortunately, this is not an important topic, and neither one of our opinions holds much weight (nor needs to) in the scheme of things.

    In fact, I have little praise for GM overall...just noting that from some perspectives, the Buick move made sense, and the company itself seems on the mend. Of course only time will tell. I don't dismiss the many new GM models as failed efforts, and neither does the auto press (nor do I think that you do). Cadillac's planned move upmarket may not work out well, but it certainly could. For Buick to cover the Acura and Lincoln competition may not work here either. But it is working so far in China, and it is possible here.

    Meanwhile, Pontiac was a more damaged brand than Buick. Could GM have rebuilt Pontiac? Sure. But they still would have had to keep Buick, or risk losing the larger market they now have in China. And like it or not, we need to sell more goods to the Chinese.
  • akirbyakirby Posts: 7,669
    Buick doesn't bother me as much as GMC, although I think GM could kill both in the U.S. and be better off in the long run. I think GM is keeping Chevy on the lower end and using Buick for the higher end whereas Ford is using one brand to do both.

    Can anyone justify GMC? I just don't get it. Give the GMC dealers the same vehicles with a Chevy badge (sorry - CHEVROLET) and be done with it.
  • smarty666smarty666 Posts: 1,503
    If Buick is catering to the higher end what the hell is Cadillac catering to then :confuse: the other other high end? c-mon, just simply ridiculous
  • gregg_vwgregg_vw Posts: 2,415
    Allen, GM kept GMC, due to GMC sales. Now, you and I know there isn't a dime's worth of difference between the Silverado and the Sierra, but many consumers apparently see it differently. There are those who will buy a GMC product, but will not buy Chevrolet. Chevy sales would pick up if GMC died, but apparently not enough to cover what they both sell together. And going forward, you will see more differentiation, as well as a great use of the Denali lineup.
  • akirbyakirby Posts: 7,669
    I've heard that argument, and if there was more differentiation I might actually believe it. But just like those who say they'd buy a mercury but never the Ford equivalent - I just don't buy it, at least not in enough numbers to justify keeping a separate cloned brand.

    As for whatever new they're planning - the question would be whether the same thing applied to Chevy would work just as well. Witness Ford and the Titanium/Platinum F150s.

    How many people cross shop the GMC and the Chevy and pit the dealers against each other? Remember the camaro and firebird? Ford only had one pony car while the GM dealers undercut each other to the point both got cancelled.

    For all of Ford's past sins, not having 2 truck brands was one of the smartest things they ever did (or didn't do).
  • berriberri Posts: 4,159
    I'm thinking the main reason GM kept GMC was to add some truck volume to its relatively low volume Buick and Cadillac franchises? Doesn't Ford recycle a lot of truck/cuv's as Lincoln models?
  • akirbyakirby Posts: 7,669
    But they can just as easily change the name from GMC to Chevy Trucks and sell exactly the same vehicles they do today just with a different grille and badge.

    The analogy would be for Ford to rebadge the F150 and Expedition as a Mercury and Lincoln.

    GMC exists for the same reason Mercury exists. Ford bit the bullet and killed Mercury. GM needs to do the same for GMC and Buick if it wants to get serious.

    Look at Ford and GM's sales volumes, then look at their plant capacity and employees. Huge difference.
  • gregg_vwgregg_vw Posts: 2,415
    edited June 2010
    Ford did do such rebadging with Mercury and Lincoln (and still offers the 1997 F150-based Navigator), but it hasn't worked as well for them. ;)

    You fail to point out, Allen, that GMC sales by comparison to Mercury are large. Chevrolet would indeed pick up sales if GMC closed, but not enough to equal Silverado and Sierra together. Further, GMC has plans to introduce models that are not shared with Chevy. Already the Acadia and Terrain do not share styling (not even greenhouses) with the corresponding Chevrolet models, and that differentiation will grow. GMC is actually going a bit upmarket from Chevy, which Mercury failed to do in comparison with Ford in its last years.

    You may be right of course. But if GM can maintain four brands (instead of eight), they still have greater potential (if not the reality...time will tell) to attract more and different kinds of customers. Like Buick and Cadillac for example. Buick will cover the $25,000 to 45,000 market pretty well using front wheel drive (and some AWD). Cadillac will be more the $40,000 to $90,000 market, using mostly rear wheel drive and AWD.

    There is always overlap of course. Ford and Lincoln overlap. Some people will prefer the Volkswagen CC, and others will go for the Audi A4 (I am a CC person and would not buy the A4, but that is another story). VW sells more cars overall by having both available.

    Finally, you know darn well that if Ford had the money and resources, they would have kept and developed Mercury. That was the plan, but it just could not be sustained without hurting the core brand's chances of success. Ford went it alone, and kudos for that, but to make it work it did mean making some severe cuts (in ways other than the past methods of delaying new models and giving short shrift to quality).
  • berriberri Posts: 4,159
    I'm thinking whether GM could sell the same number of trucks using just Chevy is moot, because I think it is more about making sure their non Chevy dealerships have enough volume to keep afloat. Most GMC is sold through combo dealers with Buick or Cadillac.

    Most of, if not all, Lincoln is just plushed up Ford so I don't think there really was a place for Mercury any more.
  • marsha7marsha7 Posts: 3,670
    I think that companies should immediately "cease and desist" in attempting to reach #1 in market share...GM had #1 and lost money...what they need is PROFITABILITY, pure and simple...Honda never tried to have the volume of Toyota, but they have usually been profitable (I think I am correct on this)...

    Take ANY business...why be #1 in volume, what does that means to customers who think???...to say I go to the #1 volume plumbing supply house means nothing if they aren't there next year due to too much overhead...I want a profitable company (altho I would never know what goes on behind the scenes, what I want is a business owner who understands about profitability over market share)...

    Why anyone would want #1 market share is beyond asinine to me
  • fintailfintail Posts: 33,561
    edited June 2010
    They lose money with every sale, but they can make up for it with high sales volume. And if it fails, just send the labor off to some third world social and environmental criminal, no matter the longterm consequences. It's the backbone of thought for every irresponsible cookie-cutter MBA golden parachute clone out there.
  • berriberri Posts: 4,159
    Being #1 in the US does seem to be a jinx. I agree that margin and cash flow are more important than market share. Unfortunately, if you are a publicly held and listed American corporation there is tremendous stockholder and investor pressure to show growth. Couple this with the fixed cost load of an automaker and it is hard not to chase volume and revenue growth. Higher volume tends to lower overhead and therefore yield a pricing or margin advantage. The only other way to pull it off really is to develop a niche or have product so desirable that buyers will pay more for the product. BMW is an example of desirable product and Honda, at least until recently is an example of niche in that although it has a lot of different models people have been willing to pay a premium for the product to get on board the Honda train. You'll notice that neither is an US company. However, as more entrants expand their offerings moving upscale even these two will face pressure to expand in order to hold or expand margin in the near future. Truth is, auto manufacturing is an ugly business to be in financially right now and it is very difficult to "cream" the market in a highly competitive environment.
  • gregg_vwgregg_vw Posts: 2,415
    Very well said, berri. Us armchair quarterbacks don't lose a dime by sharing our opinions. The manufacturers, however, are taking huge gambles in what is a cutthroat business right now. Cars are no more expensive today than they were in 2000, but they include more quality and more equipment for the same price. Ford has taken a new road, and so has GM. It is fun and easy to critique manufacturer decisions, but it is life or death for many brands right now.
  • savethelandsavetheland Posts: 671
    GM differentiates it brands much better than Ford. Ford as a company traditionally had no clue how to differentiate brands and had no idea what luxury buyers want. Ford could not sell luxury cars in Europe where it eventually terminated Scorpio and cannot sell luxury cars in US also, even though it is its own home market.

    Buick is absolutely different from Chevy and Caddy and GMC does not look anything like Chevy and has it own dedicated audience. I do not see why GM has to kill these brands and reduce its market profits share - just to satisfy few armchair CEOs from Edmund forums? Did you make research how much money will GM save or loose if it terminates these brands? If yes where are numbers? Is this thread about Lincoln or GM?
  • lemkolemko Posts: 15,144
    ...I was at the Carlisle All-Ford Show earlier this month. Ford had a course set-up to test drive some of its new cars. One of them was a Lincoln MkZ. It was a disappointing car for something with an MSRP of $42K. It only has a V-6 and a rather spartan interior. It barely seemed like a $28K car. My wife's 2005 Buick LaCrosse seems downright decadent compared to the new MkZ.

    What a Lincoln should be:
    image
  • marsha7marsha7 Posts: 3,670
    that higher volume means lower "per unit" costs, but if you must give away your profit in massive rebates, then your profit from "economy of scale" evaporates...

    So, while the buyer gets the advantage of the lower price, if the company goes bankrupt have you really received a great deal???...if the car never breaks, yes, if it is a lemon needing constant repair from a dealer that is no longer in business, no...

    Just to be #1 in market share should not be the goal for any business...

    After all, I could probably be the largest law practice in the state if I did bankruptcy for free and took 0% fees on accident cases... ;) :P :cry:
  • akirbyakirby Posts: 7,669
    Take a look at a Chevy pickup and a GMC pickup and tell me where they did all this "differentiation".

    There is no viable reason to make 4 vehicles that are clones of each other with minor differences (like the Lambdas). 2 is plenty and only if there is sufficient differentiation (like Ford is planning for Lincoln - different greenhouses, engines, sheetmetal, interiors, features, etc.).

    There is too much competition to spend resources on keeping a bloated dealer network alive. Ford has realized this and is fixing the problem. GM only went halfway. We'll see who's right in a few years I suppose.
  • gregg_vwgregg_vw Posts: 2,415
    Both could be right, Allen.
  • gregg_vwgregg_vw Posts: 2,415
    edited July 2010
    And not meaning to push anyone's buttons here, but GMC sales were up over 45% in June to 28,500 (for the month), Buick was up almost 53% to over 13,000 in June, Chevrolet was up 32% to over 141,000 units for the month, and Cadillac sold almost 12,000 units.

    Ford's sales were up 16% to over 155,000 (still beating Chevy, yes!), but Lincoln decreased over 11% to 6,300. Lame duck Mercury outsold Lincoln handily at 9,250 units, even though everyone now knows Mercury is slated for death.

    Buick and Cadillac share no models or platforms (like for example how the the Taurus and MKS are related between Ford and Mercury). Ford of course is in much better shape than it was and its quality is now absolutely stellar. But the company is still in debt to the tune of almost 30 billion dollars. Thankfully, it is like the little engine that could, and it is chipping away each month at that debt.

    Still, GM is now fielding excellent products as well, and has more of them to offer. People are really pretty fickle, and I wonder how important Ford's decision not to take government money will weigh on people's buying decisions in a year or two. Already, a fair number are obviously loving the new GMCs and Buicks. And now the Regal is making a big advertising splash...
  • gregg_vwgregg_vw Posts: 2,415
    I know what you are saying Allen, but at least the Chevy and Ford pickups no longer share any body panels (even if the greenhouse remains the same). And don't forget the Acadia and Terrain have their own personalities now. They have their own bodies, like the Taurus and MKS do. You cannot call the Chevy Traverse and the GMC Acadia clones, if you are not willing to do the same with the Taurus and MKS. I don't think any of them are clones, like the Fusion and Milan (or the previous Equinox and Pontiac Torrent were).

    I guess I don't understand the vitriole for GM. They are an American company that screwed up and is clawing its way back, and yes, due to government help. Ford gets accolades for not requiring it, but GM has shown now they have good designers and engineers and are going to make a go of it. They are paying back their loans as well. If they do really well, then taxpayers are better off. I'd love to see America dominate the industry again, rather than Korea and China.
  • savethelandsavetheland Posts: 671
    MKZ is not so much different from Fusion. It puts limitations to what can be done to MKZ to make it luxury car. And it basically takes place of discontinued Mercury Milan. Nobody in his right mind will choose MKZ over Lexus ES or Audi A4 for similar price. Yes it will be heavily discounted to sell. Ford can also limit production and make more Fusions. And it seems to be the case. There almost no MKZs available in Bay Area dealerships despite the fact I did not see the new MKZ yet on road. They simply refuse to make them, as well as other Lincolns. May be Ford is preparing to discontinue Lincoln as a brand? If you search for Audi A4 you will find order of magnitude more available cars for purchase in local dealerships.
  • lemkolemko Posts: 15,144
    What's worse is that they seemed to have decontented the MKZ. It used to have a beautiful light woodgrain dashboard reminiscent of the classic 1961-64 Continentals. I also liked the Zephyr name a lot better. The original Zephyr was a lower-priced Lincoln from the 1930s like the MKZ is today.

    Shoot, it almost seems as if Ford plans to discontinue Lincoln. What have they but two truncated, wimpy V-6 cars and a couple of stupid cross-overs and SUVs cloned from Ford vehicles. About the only thing in Lincoln's portfolio that would serously attract my dollars is the archaic Town Car, if I can still get one.
  • brucelincbrucelinc Posts: 814
    I agree Lincoln does not have the image or product (compared to the competition) that it once did. Better days are coming, Lemko, but it won't be back to the '60s.

    As for the Zephyr name, most of us kids like me (50ish) think of the Zephyr as the Fairmont clone of the '80s - not the classic Zephyr of the '30s. Many of us also think the interior of the new MKZ is far better than the blocky look of the Zephyr interior. I am not a fan of the lettering scheme but "Zephyr" didn't bring back fond memories for very many people.

    As for wimpy V6s, an MKS ecoboost would rocket past any other Lincoln ever built so fast, it would make your head spin. Even an MKZ with its naturally aspirated V6 is quicker than an old 460 Town Car or even a Mark VIII with the 32 valve 4.6 engine.

    Lincoln is in catch-up mode, for sure, but finally I think the right management is in place and they have the will to return Lincoln to its former glory. Actually, the current product line-up is better than it has been in years and in several cases, the products are impressive. The image needs an overhaul almost as much as the product. It will take even better, more exciting and more dramatically styled products along with strong marketing to rebuild the image.
  • akirbyakirby Posts: 7,669
    I agree GM is improving a lot. My issue is they still have more overhead than they need and could be even better if they did more consolidation. Ford and GM are reasonably close in sales volume but GM has WAY more employees and (I assume) production capacity. I can see keeping Buick as long as they don't just do Chevy clones. BTW - I think Ford could have kept Mercury and done the same thing - kept it alive - but I think both could do just as well without either one. However, there is still no good argument for keeping GMC. Just because you CAN doesn't mean you SHOULD. Why not just offer a Denali package on the Chevy versions? You can still let the GMC dealers sell them - just make them Chevy Truck dealers.
  • akirbyakirby Posts: 7,669
    Don't you love it when people diss the current Lincoln lineup (weak V6s - compared to what exactly?) and act as if Lincoln won't be improving dramatically the next 4 years? Lincoln is holding it's own with table scraps right now and they seem to have a plan that they're just now starting to execute. They have room to improve the current vehicles (as we're seeing on the new MKX) and seem to have plans for new platforms but we'll have to wait and see about that.
  • brucelincbrucelinc Posts: 814
    If "ifs" and "buts" were candy and nuts, we would all have a Merry Christmas but......

    If only Ford could have upgraded the Town Car back in 2005 with sheetmetal like the Continental concept and used the 5.4 3 valve engine along with improvements to the NVH characteristics.

    If only they could have found a way to make the LS more cost effective, revised the front suspension so the 4.6 could have been used, and updated the sheetmetal.

    If only they could have used the LS platform and created a Mark IX coupe.

    If only Ford could have kept the Navigator competitive and different than the Expedition - supercharged 5.4 maybe and different greenhouse.

    If only Lincoln had not been left dying on the vine for so long, the image today would be soooooooooo much better. Of course if they had done everything I wanted, they may have gone broke and declared bankruptcy like GM.
  • dandrews1dandrews1 Posts: 184
    Just for reference, the #1 profitable car company in the world is Porsche (based on profit as a percentage of the purchase price). I believe their profit margin per vehicle is over 45% of the purchase price.

    I may be a bit off on the actual numbers, but think about this:
    In Canada, a Corvette starts from 67k and can run up to 142k for the top of the line (holy crud! 75k$ in options!!) GM makes a decent amount of profit, about 10% of the purchase price..

    Now to compare, Porsche makes models from $59k (Boxster) to a 911 GT2 RS @ $163k.. now it may make far less of them than Corvette does, but makes far more money per car.(I'll ignore the SUVs and the GT Gambella supercar for now)

    I won't go on about which is a better car, as they both have their merits and appeal to different folks... but if I were a company in trouble, I may start looking to the company that has the #1 profit margin for some ideas....?

    Perhaps GM can make fewer cars, stop having HUGE stocks of them siting around sucking up capital on dealer lots, and go for a more custom order type of business model.I live near Oshawa, Ontario and I see a lot of local dealers have inventories of hundreds of cars and trucks just sitting on their lot. I go into the local MB, Porsche or BMW dealer and they have a few dozen...

    The truck business is more commodity based, so stock of trucks makes sense, but for cars, I think they could trim a lot of fat by making cars to order and trying out a JIT order system. Sit down in the dealership, do the car configurator thing with the sales person, and your car pops out a week later.
  • speculatorspeculator Posts: 116
    A few weeks ago I was attending a conference for Ford employees and Dealers at the Chicago's Torrence Ave plant. The guess speaker was Alan Mulally. The topic of his speech concerned the fate of Mercury and also Lincoln. He said that because Ford was able to discontinue Merc, the Lincoln brand would have new and improved models to compete with Cadillac and its imported rivals. He also said that these Lincolns would not be limited to sale in the U.S. but would be global vehicles. If that is the case ,then I would hope that Lincoln would have a large rear wheel drive flagship. I did not get to ask if that would be the case though. But Lincoln would need one to be a global premiere mark. I am hopefull.
  • berriberri Posts: 4,159
    I wonder if the new Caddy coupe will sell? If so, I'd like to see a Continental coupe, and maybe a convertible version as well. As for RWD, I think Ford has a decent RWD Falcon platform down under just like GM and Holden, although Lincoln could probably differentiate itself by going all AWD.
  • cdnpinheadcdnpinhead Forest Lakes, AZPosts: 3,244
    edited July 2010
    He also said that these Lincolns would not be limited to sale in the U.S. but would be global vehicles.

    Hmmm. . .where have we heard that before? Maybe this time it'll actually happen. I think it's a good strategy. If Lincoln can make products that sell in the rest of the world, that would be a good thing. . .for someone else.

    The train has left the station for me.

    When I brought up the world market plan for the LS (back in the day) it was pointed out repeatedly to me that "we don't need no stinkin' foreigners buying Lincolns." We'll do it OUR way.

    This will definitely be interesting to watch.
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