Ford Motor Co. (NYSE: F) recently won the “Best Turnaround of the Year” award, but the Detroit based automotive company’s luxury brand is still struggling.
Traditionally, Lincoln has been one of the top profit earners since the 90’s. Some believe the Lincoln had made as much as $2.5 billion in gross annual profit based on sales of the Lincoln Town Car and Navigator. In 2000, Lincoln was the bestselling luxury car brand selling 193,000 cars. Since Lincoln’s rise to the top, sales of the brand have gradually declined. In 2009, Lincoln sold just 82,847 units ranking to number 8 behind brands such as Lexus, BMW, Mercedes-Benz and Cadillac. Although the luxury market has seen turmoil since the recession, Ford Motor Co. (NYSE: F) believes that it can bring the brand back into the center stage of luxury sales.
Ford Motor Co. (NYSE: F) is now optimistic that Lincoln can be recovered now that Ford has let go of the Mercury brand. Without the drag of the Mercury brand, Ford Motor Co. (NYSE: F) will be able to give more financial allowances for the Lincoln brand. CEO Alan Mulally has already allowed the sale of Land Rover, Jaguar, Volvo and Aston Martin to give more resources for Lincoln.
Lincoln still has many issues with its audience. The company’s target market is aging with the average age of Lincoln buyers being 64, versus 52 for BMW and 56 for Mercedes-Benz. Lincoln has an issue with loyalty. Many people that previously bought Lincoln vehicles have switched to other brands or switched to other Ford vehicles.
Ford Motor Co. (NYSE: F) Chairman Bill Ford previously said that the company will focus on innovation in the brand.
