Louisville's Ford plant may get new Lincoln SUV

By Jere Downs • jdowns@courier-journal.com • November 8, 2010

Ford Motor Co. is expected to build a new Lincoln sport utility vehicle — alongside the Escape and other compact, fuel-efficient models — at the Louisville Assembly Plant once the factory’s renovation is completed a year from now, company officials say.

The addition of a Lincoln nameplate to the Louisville lineup would come as Ford focuses more attention on a luxury brand that was largely overlooked when the company owned Volvo, Jaguar and Range Rover. With those luxury names sold off, Lincoln now is the focus of Ford’s effort to attract premium buyers.

Ford executives, speaking on condition of anonymity, said the as-yet unnamed Lincoln SUV, which is still in development, will be smaller than the Lincoln MKX and compete with the Lexus RX.

A formal announcement of new Louisville Assembly products is expected early next month, before the plant stops producing the Ford Explorer on Dec. 13.

A smaller Lincoln SUV “makes sense,” said Ivan Drury, senior analyst at the automotive website Edmunds.com. “That segment right now is one of the hotter segments.”

The Lexus RX dominates the small luxury crossover SUV market — 76,465 of the vehicles were sold in the first 10 months of the year, including a newer hybrid version. Far behind but swiftly gaining market share, Acura sold 12,252 of its luxury RDX. BMW has sold just 5,135 of its X3 model this year.

Besides finely appointed interiors and other luxury perks, those premium SUVs generally seat five, have 4- or 6-cylinder engines and cost between $32,000 and $40,000.

Lincoln already markets the maxi-size Lincoln Navigator, built at the Kentucky Truck Plant alongside the Ford Expedition SUV and Super Duty truck. Next smaller in size, the Lincoln MKT seats seven. The size of a Ford Edge, the Lincoln MKX seats five.

Ford vice president of marketing Ken Czubay didn’t discuss what will be built in Louisville during a monthly conference call with journalists and investors this week. But asked about poor Lincoln sales so far this year, Czubay acknowledged that the automaker is focused on renewing its luxury line.

Ford has long been under pressure to revive Lincoln, whose year-to-date sales total just 70,120. That is a 6 percent increase over last year, but Lincoln still lags behind the recently ended Mercury line, which has sold 78,000 vehicles so far in 2010.

Reviving Lincoln
Ford has long been under pressure to revive Lincoln, whose year-to-date sales total just 70,120. That is a 6 percent increase over last year, but Lincoln still lags behind the recently ended Mercury line, which has sold 78,000 vehicles so far in 2010.

“Our commitment to Lincoln is to reinvent it,” Czubay said during the conference call Wednesday. “We will have seven major new products or redesigns over the next two years.”

Where crossovers meet luxury vehicles is a sweet spot in the auto market now, and Ford could grab consumers’ attention with a new Lincoln SUV, said Jesse Toprak, vice president of industry trends at http://www.truecar.com.

While Ford may not sell a lot of the SUVs, “it is going to definitely lead Ford to consumers who otherwise will not go to a Lincoln dealership,” Toprak said.

Jim Tetreault, Ford’s vice president of manufacturing, said in a speech in Louisville last month that the company is poised to leap on smaller niches in the auto market as opportunities arise.

Ford’s business model no longer relies on extremely high volume of the same vehicle, like “500,000 Taurus a year in two plants,” Tetreault said. Rather, he added, the new flexibility of assembly lines like the retooled one planned in Louisville will allow Ford “to produce 400,000 vehicles in one plant, but up to six to seven different kinds of vehicles.”

Transformation plan
At Louisville Assembly, workers will build vehicles on the versatile “C” platform, a compact chassis and suspension that can host ten different models, including the Ford Focus.

Already, Ford has reinvented its Michigan Assembly Plant near Detroit to manufacture an entirely redesigned Focus common to both the North American and European markets. Flexible robotic equipment to come in Louisville Assembly’s body shop will exceed technology even at Michigan Assembly, Tetreault said.

“We are going to transform the Explorer plant into the most high tech, small car plant in the world,” he added in remarks to the Kentucky Association of Manufacturers at their annual meeting. “Once that transformation is complete, the Louisville Assembly Plant … will afford flexibility like we have not had anywhere else in the world.”

Versatile plants are required, he added to cope with precipitous shifts in demand sparked by gas prices and other trends.

Meeting demand
“Our factories have to be different from the mass manufacturing plants of the past,” Tetreault said.

For example, Focus demand soared when gas exceeded $4 per gallon in mid-2008. The plunge in gas prices six months later scrambled the automaker’s plans, he added.

“We were frantically trying to figure out how we could produce more Focus,” he said of that summer of high gas prices. “By December of that year, gasoline went down to $2.40 and Focus demand dried up. We went from planning three shifts to laying off a shift.”

Tetreault declined to comment about the possibility of a new Lincoln headed for the Louisville Assembly Plant.

Whatever Ford plans, union officials say workers hope for word soon. As sales and production of the Explorer wound down last year, Louisville Assembly reduced its work schedule from two shifts to one in July of 2009, and it now employs about 1,000 workers. The plant’s renovation is expected to cost at least $500 million and take up to a year to complete.

Union and company officials expect the plant to employ at least two shifts, if not three, possibly more than doubling its current staffing level.

“They want to hear the official announcement,” United Auto Workers Local 862 Building Chairman Steven M. Stone said of the rank-and-file workers. “People are getting restless … ”

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