What does Ford Motor Co.’s decision to stop selling sedans in the United States mean to Lincoln’s cars?
Nothing good. But, honestly, does it matter?
You — and Ford — might be surprised.
It’s easy to make the case against Lincoln’s cars. It sells just two — the midsize MKZ and large Continental. Neither is a leader in its segment, and neither is likely to earn much, if any, profit. They account for just 23.3 percent of Lincoln’s sales so far this year, down from 27.6 percent in 2018.
Both cars are doomed. The MKZ, built alongside the Ford Fusion in Hermosillo, Mexico, is likely to go out of production in late 2020 or early 2021. The Continental’s survival is guaranteed only “through its product lifecycle,” according to Ford’s new contract with the UAW.
That’s a less mercenary way of saying Ford will keep building them till the last check clears, but the end is nigh, and don’t expect any significant investment in new technology or features between now and when the last shift punches out.
If you want a new Continental — and you may because it’s not a bad car: roomy, comfortable, handsome in a vaguely upscale way — I wouldn’t wait for the 2024 model.
“Lincoln’s sedans are going away,” IHS Markit senior analyst Stephanie Brinley said.
At the same time, Lincoln is adding SUVs. They sell for better prices than sedans, particularly for traditional American brands like Lincoln.
Lincoln is following in the Ford brand’s footsteps, as tends to happen in corporations where the volume brand rules. Ford decided to quit selling cars like the Taurus, Fusion, and Focus because they mean even less to the brand than Lincoln’s sedans. Cars are just 15.3 percent of Ford-brand 2019 sales, down from 19.1 percent for 2018.
“Lincoln is going where the market is,” Autotrader executive analyst Michelle Krebs said. “SUVs are increasingly more popular than cars in the luxury vehicle market, just as in the non-luxury market.” However, she added, a much higher proportion of luxury shoppers still consider both cars and SUVs, while mass-market buyers have shifted overwhelmingly to SUVs.
“About 40 percent of luxury vehicle buyers do their homework and very deliberately choose a sedan,” said Eric Noble, president of Orange County consultant the Carlab.
Most luxury car buyers have other vehicles, so they don’t need the Swiss Army knife versatility of an SUV, he said. They can have an SUV for its high seating position, all-wheel drive and room; and a car for its looks, handling or just to be different.
“It’s impossible to become a leading luxury brand without cars,” Noble said.
Aye, there’s the rub. Today, Lincoln is so far from being a leading luxury brand that just getting on most shoppers’ lists for one of their vehicles would be a major victory.
The emphasis on SUVs could help with that. The Navigator is a world-class luxury SUV, but its size and $75,825 base price make it a boutique model. New models like the slightly smaller Aviator and compact Corsair could win the brand some buyers, as the Nautilus did when it replaced the midsize MKX a year ago.
At some point, though, Lincoln will need a bigger model line if it’s to become a serious player.
“The Continental and MKZ are not competitive products, but Lincoln needs volume,” Noble said. “Lincoln needs at least one, maybe two dedicated luxury platforms, with dedicated component sets. You have to pull at least two vehicles from a platform to justify the investment.
“I’d do a large sedan and an SUV,” Noble said.
The architecture underpinning the Aviator — already shared with the Ford Explorer — could be one of Lincoln’s core platforms, he said.
“Ford would be nuts not to do a modern sedan, or a liftback like the Audi A7, off that platform.”
Vehicles proportioned like slightly lifted station wagons — picture a luxurious Subaru Outback or Volvo’s V60 and V90 wagons — may be Lincoln’s next step, Brinley said.
“Lincoln will have to find something different in their proportions so they don’t compete with its SUVs,” she said.
“Lincoln has to do something different, but it’s not clear what.”