With Mercury gone, Ford will now devote resources to redefining luxury brand.
Lincoln’s future depends on new small, stylish cars and SUVs that broaden the brand’s lineup and give Ford’s only remaining luxury brand a clear identity, according to dealers and analysts.
The decision to end production of Mercury this year gives Ford an opportunity it didn’t have before, said Erich Merkle, president of the consulting company Autoconomy.com in Grand Rapids, Mich.
“It will allow them to come down in terms of size,” Merkle said. “They couldn’t do that before because Mercury was sitting on the same lot.”
Without Mercury, Merkle said, Lincoln can introduce new small cars and SUVs at slightly lower prices than the current Lincoln lineup and then slowly increase the prices of its existing vehicles.
Ford has said it plans to introduce seven all-new or significantly refreshed Lincoln vehicles over the next four years – including its first-ever Lincoln in the compact segment. Ford has not said whether that compact vehicle will be a car, SUV or crossover.
“I think all the luxury brands are looking for that magic introductory vehicle,” said Bill Chope, president of Crest Automotive Group, which owns several dealership franchises, including a Lincoln Mercury store in Sterling Heights, Mich.
Lincoln’s success is more important now because Ford has sold its other luxury brands, Jaguar, Land Rover, Aston Martin and Volvo.
For dealers, sales volume from new models is critical because Ford’s 276 stand-alone Lincoln Mercury dealers typically count on Mercury for 40 percent to 60 percent of their sales.
“The commitment of Ford is solid in terms of product development,” said Cullan Meathe, owner of Metropolitan Lincoln Mercury in Garden City, Mich., who depended on Mercury for about 60 percent of his annual sales. “Unfortunately, those vehicles won’t fully be in dealer showrooms for the next three to four years.”
Over the past four years, Ford has introduced four models with a bold, bow wave grille that resembles the front of a ship.
Lincoln’s share of the luxury market has increased from 6.5 percent in 2005 to 8.2 percent through May, according to Autodata.
However, Lincoln’s year-to-date sales are eighth among 13 brands classified as luxury by Autodata.
“This is a work in progress,” said Jeremy Anwyl, CEO of Edmunds.com. “Basically, what they have been trying to do is differentiate Lincoln further from Ford.”
Lincoln still lacks a clear identity, he said.
“If you were going out there and asking consumers, I don’t think you would get consistent answers if you ask what a Lincoln is,” Anwyl said.
“We have a very clear vision for Lincoln,” Ford President Mark Fields said June 2, “and it’s to offer customers the finest quality in vehicles that have that magic combination of a really engaging driving experience … combined with a really warm and inviting level of comfort.”
And without Mercury, Fields said Ford can shift all of the marketing and engineering resources that it was devoting to Mercury to Lincoln.
Not surprisingly, reaction to Ford’s plans for its luxury line is quite positive at one Jacksonville Lincoln dealership.
“We are very excited about our future with Lincoln,” said Morris Jelks, new car sales manager at North Florida Lincoln Mercury on Southside Boulevard. “Ford will have a singular focus on one luxury brand, which they have not had in the past. That focus will show up in seven new and refreshed products over the next few years for Lincoln. Ford Motor Co. is on a roll, and Lincoln is the next step in its plan.”
This fall, Lincoln plans to launch the hybrid version of the midsized MKZ sedan and a restyled 2011 MKX crossover.
The hybrid MKZ – like its Ford Fusion and Mercury Milan siblings – will get 41 mpg on the highway. It’ll also have the same base price as that of the gas-powered version.
The MKX will be the first vehicle to come with the company’s new touch-screen instrument panel called MyLincoln Touch as standard equipment.
But, to successfully elevate Lincoln, said Jim Hall, managing director of 2953 Analytics in Birmingham, Ford must go farther.
The MKZ hybrid is expected to draw a lot of attention, but the vehicle won’t be redesigned for several more years.
“The next MKZ needs to be more than a dressed-up Ford Fusion,” Hall said.
A good example of how different Ford and Lincoln models need to be, Hall said, is the Ford Flex large crossover and the Lincoln MKT, which look nothing alike. However, sales of the Flex have been disappointing and the MKT, launched last fall, is Lincoln’s lowest-volume vehicle so far this year.
“The hardest thing Ford is going to have to do is be consistent and committed,” Hall said.
Jelks believes the First Coast has been and will stay committed to luxury cars, like the Lincoln.
“Jacksonville is a fantastic luxury market. Our customers have always appreciated the American luxury that Lincoln has produced,” said Jelks, who has been selling the Lincoln and Mercury brands for 24 years at the Southside dealership. “North Florida Lincoln has always appreciated the loyalty our customers have given us over the years. We know that satisfaction will only increase in the coming years, as well.
“With our excellent service and central location, we feel that North Florida Lincoln will be poised to flourish for generations to come,” Jelks said.