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Ford, committed to Lincoln, asks dealers to chip in millions

The 2011 Lincoln MKX features MyLincolnTouch, which replaces knobs and switches with a touch-sensitive screen.

Associated Press

The 2011 Lincoln MKX features MyLincolnTouch, which replaces knobs and switches with a touch-sensitive screen.

DETROIT — Ford Motor Co.'s Lincoln dealers may be facing the bleakest days in the brand's 93-year history. Soon they will have to decide whether to double down on the luxury line or walk away.

Sales have plunged almost two-thirds from their peak and now average fewer than two vehicles a week for each dealer, one-thirteenth the volume of Toyota's Lexus luxury brand.

Most of Ford's 1,187 Lincoln dealers also sell Mercury vehicles, and will lose more than half their sales when the automaker discontinues the mid-priced line at the end of the year.

Now the company may ask them to spend as much as $2 million each to upgrade showrooms and improve customer service at a meeting in Dearborn, Mich., on Sunday.

Lincoln lags behind other luxury lines as its buyer base ages and it fights an image driven by the Town Car, the typical airport shuttle of corporate executives. Lincoln sold an average of 5.8 cars per showroom a month in 2009, compared with Lexus' more than 78, according to company data and research firm Grant Thornton.

"You can't make it on that; it's just impossible," said Jack Kain, a Ford and Lincoln dealer in London, Ky. "Ford has got to do something."

The second-largest U.S. automaker says it is. Chief executive Alan Mulally has sold off the Volvo, Aston Martin, Jaguar and Land Rover brands and is focusing on Lincoln, now Ford's only luxury line, to get a bigger slice of the more profitable premium car market.

The company is attempting to attract younger buyers to Lincoln with redesigned models like the MKX sport utility vehicle and touch-screen technology to operate phone, stereo and climate controls.

After peaking at 231,660 vehicles in 1990, Lincoln's U.S. sales fell to 82,847 last year. While sales have edged up 4.7 percent this year, those of General Motors' Cadillac brand have surged 50 percent. Total U.S. sales of luxury models are up 15 percent, according to J.D. Power & Associates.

"We're going to make a major investment in Lincoln over the next four years with seven new or significantly refreshed products," Mark Fields, Ford's president of the Americas, told auto analysts last week in Southfield, Mich. "Our approach is to enhance and expand Lincoln here in the U.S., and then we can think about maybe looking at global opportunities."

Sunday's meeting with Ford may be bad news for some Lincoln dealers as the automaker lays out its higher expectations for the brand after the Mercury line disappears from their showrooms, said Bob Tasca Jr., head of the Lincoln-Mercury dealer council.

"After that meeting, dealers are going to have to decide if they can make it without Mercury," Tasca said.

A new small car is among the seven new or improved models Ford has said are coming from Lincoln by 2014. It has overhauled Lincoln's design theme to outfit models with prominent, split-bow grilles. It also is dedicating engineering and marketing staff to Lincoln, rather than having the brand share personnel with Ford.

Ford, committed to Lincoln, asks dealers to chip in millions 09/27/10 [Last modified: Monday, September 27, 2010 8:20pm]
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