24/7 Wall St: Ford Should Ditch Lincoln Motor Company

In December of 2012, Ford Motor Company said goodbye to nine decades of “Lincoln,” renaming its luxury division “The Lincoln Motor Company” to mark the start of its rebirth, and to conceptually separate it from its parent a bit further. Lincoln Motor Co. is currently led by President Kumar Galhotra, and has gained some considerable ground in the luxury vehicle space since its rebranding.

Despite this, in a piece published earlier this week, website 24/7 Wall St laid out its argument for why Ford should kick Lincoln to the curb, at least in the US, pointing out what a small fraction of total US Ford sales the luxury division accounts for. The outlet’s argument hinged on three premises:

1. It will never be as prestigious as the likes of BMW or Mercedes.
2. A Lincoln is still perceived as an “old person’s car.”
3. It has too few models to ever compete with its competitors.

With all due respect to the folks at 24/7 Wall St, we could hardly disagree more with the notion that Ford should kill off The Lincoln Motor Company, for two very important reasons.

1. The Brand Is In The Midst Of A Renaissance

Along with the official name change, other shifts took place at Ford’s luxury division, as well. New design, product development, and sales teams were created for the marque, and The Lincoln Motor Company went about revamping its portfolio. The results speak for themselves; 2014 sales in the US climbed nearly 16 percent compared to the year prior, followed by a more-than-7-percent gain in 2015. What’s more, the average age of ownership has declined from a high of 67 down to 58, as of 2015.

With the huge amount of interest in the new, 2017 Lincoln Continental, not to mention the marque’s recent successes in the luxury crossover space, it’s reasonable to suspect that both numbers might grow even more favorable in the future.

2. Ford Needs The Brand To Compete In The Luxury Space

Luxury vehicles tend to be fairly high-margin products, making the space an important one for any full-fledged automaker. It almost doesn’t matter how few Lincoln-branded vehicles are sold compared to Ford’s overall US sales; pulling out of the luxury market entirely would be an ill-advised move, and Ford’s “Platinum” trim level doesn’t have enough prestige or distinction to pull in rich buyers.

No, it can’t be said that Lincoln is truly competitive with the likes of Audi, BMW, Mercedes, or even Cadillac. Heck, the bulk of its lineup is available with only front-wheel or all-wheel drive; Lincoln has purposefully avoided chasing after performance like the other luxury marques of the world. But in that way, its “Quiet Luxury” product philosophy has carved its own niche into the market space, and Ford itself seems quite pleased with the results.