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Where Is Ford taking the Lincoln Motor Company?



  • berriberri Posts: 4,000
    Lincoln's just got a very tough battle ahead. They basically left the lux market decades ago when they reverted to what consumers conceived as gussied up Fords with no real status of ownership. Unfortunately, many imports moved into the vacated space while they were napping. I wish them luck and hope they can succeed, but I don't think I'm going to wager on it. Maybe just a small increase in their volume can generate an incremental profit though.
  • gregg_vwgregg_vw Posts: 2,419
    You are more or less correct. Lincoln started going the wrong way quite awhile ago now. However, the Town Car was still perceived as a separate luxury car, rather than another Panther iteration at least through 1997. The 1999-2006 LS was also anything but a gussied up Ford.

    In hindsight, which is often 20/20 (but useless), killing both Mercury and Lincoln, while keeping either Jaguar or Volvo, may have worked better. Neither of those brands, though troubled, had the baggage of being "gussied up Fords," and both are still seen as luxury brands.

    However, what's done is done. Lincoln can still rise, if the investment is made and the importance of differentiation and delivering the best has truly sunken in.
  • akirbyakirby Posts: 7,622
    While the Town Car was perceived as a luxury car at one time, it was still never really in the same class as the imports.

    My "rebadged Taurus" comment was just a joke for the people who still like to call the new MKZ just a rebadged Fusion.

    I agree that Jaguar has a much higher perception of luxury in addition to having better luxury vehicles than Lincoln. But I'm not so sure that keeping Jaguar would have been a better move.

    Remember that the reason they got rid of the PAG brands was to free up the investment capital that they would have required and put it all towards saving the Ford brand. Or to look at it another way - had they not sold Jaguar they might not have survived the downturn like they did.

    But I also think Ford has the ability to make a lot more profit on a revamped Lincoln than they could with Jaguar even without the luxury image.

    If Ford thought Jaguar would be more profitable they could have bought it back and killed Lincoln.
  • hpmctorquehpmctorque Posts: 4,118
    On the suggestion that Ford Motor Co. should have kept Jaguar and killed Lincoln, I think that the price and image gap between Jaguar and the Ford brand is just too wide for that to have worked well. If Ford FoMoCo had had the money to keep Lincoln and Jaguar, then Lincoln could have been FoMoCo's lower luxury brand (think Buick and Lexus ES, IS and GS competitor), while Jaguar became the upper luxury brand.

    As things stand I think Lincoln will have to introduce some RWD models to really succeed, starting with a luxury version using the next generation Mustang platform.
  • gregg_vwgregg_vw Posts: 2,419
    Ford sold both Jaguar and Volvo at a huge loss. Whatever immediate cash the Volvo sale made for Ford would not have made the difference between saving Ford or not. They still would have sold their interest in Jag, Aston, Land Rover and Mazda. Volvo sits right above Ford price-wise. As I said, hindsight...
  • Stever@EdmundsStever@Edmunds YooperlandPosts: 38,947
    edited December 2012
    I think part of the problem was that Volvo was only viable with continuing investment, and the new owners have committed to 11 billion for that. (link).

    Volvo Car Corp. is struggling but just got a $1.2 billion loan from a Chinese bank and they are still looking for more money. Sales are lagging. (WSJ)

    Ford got 1.3 billion from Geely for the sale.
  • akirbyakirby Posts: 7,622
    Bingo. The cash from the sales was gravy. The real benefit was that they did not have to spend any future capital on those brands which would have been significant to keep them competitive.

    Considering that Ford BARELY had enough cash on hand to make it through the downturn - the extra Billions required probably would have sunk them. Or at least hindered the turnaround of the Ford brand significantly.
  • akirbyakirby Posts: 7,622
    While I and many other Lincoln fans would love to see a RWD performance vehicle or two, I don't understand why people continue to say that Lincoln NEEDS RWD to "succeed".

    If you consider "success" getting good reviews from enthusiasts and the media - ok, I'll buy that.

    If you consider "success" as selling a reasonable number of vehicles at a decent profit - no way.

    Let's open 2 Lexus car dealerships. I'll sell the FWD models and you can sell the RWD models. Who do you think will be more "successful"?
  • hpmctorquehpmctorque Posts: 4,118
    I agree with Steve's response to your post regarding Volvo. In addition, Volvo doesn't rank as a true luxury car, but, rather, a near-luxury one. As such, Ford can do better with Lincoln, which has been in the Ford family for as long as anyone can remember (Ford originally purchased Lincoln). Like Jaguar, Volvo is an unnatural fit in the FoMoCo portfolio.
  • hpmctorquehpmctorque Posts: 4,118
    I understand and agree with your point that market share and profitability, not necessarily in that order, should be the determinants of success. However, the success of Lexus' FWD models is probably helped by its more upscale RWD GS and LS siblings, in my opinion.

    I know that Audi and Acura rely almost exclusively on FWD architecture, but they haven't been as successful, by your metrics, as BMW, Mercedes and Lexus. Wouldn't you agree? For this reason I would bet on Cadillac over Lincoln.
  • gregg_vwgregg_vw Posts: 2,419
    Unnatural? We are talking cars here. Besides, Ford and Volvo were quite incestuous, sharing platforms and engines in the USA, Europe and Asia. Ford totally screwed up the S80 when it was redesigned. Boring. Come to think of it, Volvo is way better off with a Chinese investor. Never mind. Back to Lincoln. ;)
  • akirbyakirby Posts: 7,622
    the success of Lexus' FWD models is probably helped by its more upscale RWD GS and LS siblings

    Everybody says this, but I'm not sure I believe it. Are you thinking that people go into the dealership for a GS or LS but leave with a RX or ES?
  • akirbyakirby Posts: 7,622
    edited December 2012
    For this reason I would bet on Cadillac over Lincoln.

    Do you think it's easier for Cadillac to win over BMW and MB owners or for Lincoln to win over Audi, Lexus and Acura owners?

    And let's say that Cadillac and Lincoln end up with the same sales volume. Ford probably spent 25% of what GM had to spend for platforms.

    Again - I'd love to see a high performance Lincoln but it would be a niche vehicle. They need lower cost higher volume higher profit vehicles to survive.
  • hpmctorquehpmctorque Posts: 4,118
    edited December 2012
    I'm saying that the GS and LS lift the prestige and cache of the Lexus brand, thereby making the RX and ES more aspirational. Those larger models help people justify choosing the RX and ES over the RAV and Camry, as well as over competing luxury models. I think these are important factors, in addition to the excellent quality of Lexus vehicles, that drive Lexus sales and profitability. Lincoln doesn't enjoy this advantage presently.

    Maybe the automotive press and performance car buffs, who are generally positive on RWD, raise the value assigned to this architecture, but that's unlikely to change any time soon.

    As for Audi, its halo sportscars, the R8 models, use RWD architecture. I believe that the Acura NSX replacement will too, although I'm not certain. I've read that this future Acura model will incorporate Hybrid technology in its AWD drive system.

    I would summarize my point by saying that while having some RWD models may not be essential for Lincoln, going forward, it would be very helpful.
  • hpmctorquehpmctorque Posts: 4,118
    edited December 2012
    I don't know the answer to your question. To the point in your second paragraph, though, yes, Lincoln spend significantly less than Cadillac on pIatforms. However, I think that it's unlikely that Lincoln will come close, much less equal to Cadillac's sales volume without introducing some RWD models. Time will tell who's right.

    A high performance niche vehicle would help Lincon achieve preater sales in its near-luxury models, in my opinion. That's the main point of high proces niche vehicles, since they're often loss leaders.

    I think that a sport coupe or sedan built off of the next generation Mustang platform, which will finally feature IRS, could be a relatively high volume model for Lincoln. I'd consider it a slam dunk.
  • akirbyakirby Posts: 7,622
    We disagree on the "halo" effect and how much RWD adds "prestige" to the lower cost FWD models.

    I don't see the GS and LS as any kind of "halo" vehicle that would draw in buyers. I think Lexus RX and ES buyers are looking for luxury features and a luxury dealership experience at entry level prices.

    The R8 would be the best halo candidate along with the RS vehicles for Audi.

    You could use Acura as a case study and say that their sales are low because they don't have any RWD vehicles but I don't think that's the reason for low sales.

    It sounds like there will be a RWD Lincoln built off the mustang platform so I guess we'll have to wait and see. Sales of the new MKZ and new MKC (small crossover) will be very telling.
  • hpmctorquehpmctorque Posts: 4,118
    edited December 2012
    Yeah, we're both just expressing opinion because neither of us has hard statistical evidence to support our positions. To clarify, I'm not saying that RWD models are the only reason for the relative sales success of BMW, Mercedes, Lexus and Cadillac over Audi, Acura and Lincoln; only that it's an important factor, based on annecdotal evidence.

    Regarding profitability, to the best of my knowledge these automakers don't break out such things as the profitability of individual models, margins, or their contribution to break even, etc., so we can only make educated guess regarding profitability.
  • berriberri Posts: 4,000
    edited December 2012
    Most people aren't really auto enthusiasts, so I've always wondered whether most people who have the means to buy a luxury vehicle really care about RWD vs. FWD. I think that for the majority, it is probably more about looks and perceived status. If there is, I'd expect it would be more correlated to buyers in the Snowbelt leaning FWD and those in the Sunbelt going the other way. Besides, in much of the country the roads and terrain are rather flat and boring.
  • akirbyakirby Posts: 7,622
    That's my point. I don't think the average buyer knows the difference or cares.

    80 percent of BMW 1 series owners actually think their vehicle is FWD.
  • nvbankernvbanker Posts: 7,285
    I used to believe that to be a true "Luxury" or performance car, you needed to be RWD, if not V-8 as well. I'm beginning to reconsider due to:

    1) Audi has a FWD layout, usually with AWD to compensate, and has been on a meteoric trajectory for the past decade with that platform, plus, it's not the A8 that is selling, it's the A6 & A4.

    2) The Lexus ES is by far the best selling Lexus Sedan, and has been since about 1993. And it's FWD only. Part of it is the value/price proposition, but the FWD doesn't seem to hurt it at all.

    3) The perceived status of the brand seems to matter a lot more than platform layout these days in the sales results. Not as true when Cadillac started their comeback, but is today. Lincoln is going to have to re-establish some Panache before it will be perceived as a player again, somehow. Cadillac did it with the Art & Science styling, despite abysmally ugly interiors at the early period, and the RWD layout.

    Big cars are dying as are their V-8 powerplants. I fear for the Lexus LS' future. The 7 series is not a great seller as well, the S Class will be the last large survivor. Things are changing fast in the Luxury Lines.
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