By on September 25, 2012

Long-time TTAC readers know of my sentimental fondness for Crain Communication’s Jamie LaReau. Now the first lady of automotive journalism has uncovered some interesting news about Lincoln’s continuing attempts to, like, do crazy stuff, man.

According to Ms. LaReau’s article in Automotive News, Lincoln is planning to revamp their dealer pricing strategy in January. Invoice prices will be raised 1 percent. Holdback — the old chestnut of domestic auto sales, an incentive between 2 and 3 percent of sticker price kicked to the dealers once a quarter or so — will be eliminated. Instead, dealer bonus payments will be handed out based on customer satisfaction index results and other nebulous factors.

The reason given for this change: BMW and Mercedes don’t have holdback, dontcha know, so Lincoln is going to get rid of it too. But that’s like me deciding to wear a satin dragon suit to the gig I used to do playing acoustic guitar at a restaurant during lunch. Jimmy Page wasn’t awesome because he wore a dragon suit; dragon suits are awesome because Jimmy Page wore one. Cause and effect. Can’t get ‘em confused. This is the same kind of stupidity which leads to Cadillac chasing Burgerkonigring records. Dancing with a candy cane doesn’t make your ugly-ass hipster girlfriend Katy Perry. Beating BMW around a racetrack doesn’t make the tree-seeking ATS a panty-dropper like even the most prosaic Dreier $299/month lease special. Cutting holdback won’t make the MKS an equal driveway trophy to a 535i.

Since the dealers still need cash over and above the invoice/sticker difference in order to keep the lights on, Lincoln’s going to tie that cash to a variety of eminently stupid ideas — such as requiring that all dealers have a “Lincoln Brand Champion” on site. As a former dealership employee, your humble author can assure you that these ideas will last until dealers start missing checks because of them, at which point the dealer association is going to call the attorneys and shit’s gonna get real in a hurry.

In the meantime, there will certainly be some bizarre behavior as a result of the incentive programs. Way back in the dark days of 1994, your humble author was a salesman at an Infiniti dealership. Our equivalent of “holdback” was paid based on the results of a phone call made to the customer after the sale by Infiniti. The purpose of this call was to measure customer satisfaction. Well, we regularly dissatisfied our customers in every way possible, from screwing them on the trade to accidentally putting nine hundred and eighty-one miles on their car before they picked it up.

How’d we deal with this? Easy. We had our extremely sexy sales manager* bring each customer into the office. She would offer them a set of Infiniti-engraved coffee mugs to be delivered, by her, in person, after the call “turned out alright”. Somehow this worked. At the time I was too young and stupid to understand that the men buying these cars were extremely interested in having this woman visit their homes — but she was not, and therefore our dealership got the cash we needed to keep the Dealer Principal’s nose stuffed with that sweet, sweet coke. When the pixie-MILF was fired in favor of a 300-pound Polish gentleman, customer-sat numbers promptly headed down to the proverbial Challenger Deep. Lincoln appears to be just as naive as I was in 1994, so we’ll see how long it takes them to smarten up.

* So…. I took a moment from writing this article to Facebook-stalk the old sales manager in question. My G-d, she is still gorgeous, and she has to be every bit of 52 years old now. Kind of thinking about sending a friend request. What say you, B&B? Should I?

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37 Comments on “You Know I Won’t Hold You Back Now — Says Lincoln To Dealers...”


  • avatar
    Mr. K

    Sure send her a little hey how are ya – after all it’s simply a professional relationship to give you additional perspective into… whatever she is doing today, right?

  • avatar

    I would go for it I we’re you.

  • avatar
    Robert.Walter

    Do it for the children!

  • avatar
    david42

    Definitely. And don’t forget to ask her to bring you a coffee mug.

  • avatar
    Tinker

    Oh, yes. Get in tough with your not-so-old friend. Ahh memories!

    Have her over for breakfast!

  • avatar
    Zackman

    No more holdback? See ya, Lincoln. Seems like the kiss of slow death to me.

    As for as a Lincoln Brand “Champion”, good feelings don’t pay the bills…
    I find it funny to try to compare themselves with BMW, but according from what I read on here and other sources, BMW ain’t what it used to be, either.

    To me, I believe all cars have reached a plateau. They’re all designed and built the same way, it’s just the quality of materials and attention to detail that may differ. A gear may be designed to last forever, but if it’s made of nylon, not necessarily…

  • avatar
    28-Cars-Later

    Go for it JB!

  • avatar
    JKC

    You know you’re going to do it, Jack… so do it with our blessings. : )

  • avatar
    Felix Hoenikker

    Messing with the holdback might just be the pooch that Lincoln should not have screwed!

  • avatar
    George B

    Does she have hairy arms?

    If a dealership gets holdback for Fords and doesn’t get holdback for Lincolns, wouldn’t that put the dealership in the position of pushing loaded Fords in place of Lincolns? The final customer gets a better deal and so does the dealer.

    • 0 avatar
      aristurtle

      Yes, and then loaded Fords sell in better quantity than Lincoln and probably produce better margin, too, and then Mulally finally convinces the old-timer holdouts in the Ford executive organization (and on the board) that the Lincoln brand is dead, which has been a goal of his for like five years now.

      • 0 avatar
        28-Cars-Later

        Since a Lincoln is nothing more than a loaded Ford at this point, you would think it would already have more margin… or did it devolve like Mercury to be within a $100 difference in msrp of each other?

  • avatar
    Junebug

    Gee, better tell my mother-in-law to go ahead and buy that MKZ hybrid!

  • avatar
    Tinn-Can

    Child Support – Consider all the points before recontacting people…

  • avatar
    slance66

    I had to re-read this to make sure that yes, the elimination of hold-back accompanied a price increase, not decrease. For a brand that isn’t competitive now…how does this possibly help? If they want customer satisfaction, target women like Lexus does and provide a nice coffee and croissant/bagel area at the service wait space. Give out free small bottles of water. Brand Champion…sounds like somebody spent money on a outside consultant (usually some boob who just graduated from college).

    Of course you send the friend request.

    • 0 avatar
      Silvy_nonsense

      The role of the brand champion is pretty straight forward and is described in the Automotive News article Jack links to above. Having read the original article, I think the brand champion role makes sense and is the exact opposite of outside consultant malarkey. (Its depressing that Lincoln dealers need something so basic spelled out, but improvement has got to start somewhere.)

  • avatar
    Robert.Walter

    Any chance Ford is doing this to create positive buzz (like Apple just did with iOS 6 Maps)?

  • avatar
    Neb

    I’m surprised to hear this woman was fired after all Jack’s stories made it crystal clear she was the one holding the dealership together.

    And Jack, your article has given me an insight. Ever hear of cargo cults? The domestic luxury brands are cargo cults. They imitate the behavior of the European luxury brands in hopes they get the same goods, without any understanding of why the Europeans act the way they do.

    (You may have said this before; if so, please disregard.)

    • 0 avatar
      Jack Baruth

      I haven’t said it like that. An elegant, accurate summation.

      • 0 avatar
        Silvy_nonsense

        It’s too bad the U.S. headquartered manufacturers don’t have any presence in Europe what so ever. If they had gone to the trouble to build factories there and sold cars there, they might get it. Ford, for example, never owned any European luxury brands and has zero insight into luxury car development, manufacturing and marketing. Oh, wait…

  • avatar
    Flybrian

    My paraphrased retelling of your last paragraph inspired MY general manager to recount a coke-addled tale of giving one of the first Diamantes on the West Coast to a homeless man, so thank you…?

  • avatar
    86SN2001

    None of that matters when your whole division is a trim level on a Ford.

    They need decent, competitive products. Not silly gimmicks like this, or the ability to watch a mechanic work on your Lincoln.

    Lincoln is a dead brand walking. Ford doesn’t want, nor do they care to see Lincoln survive. It’s clearly evident by their lack of initiative and not investing a thing into Lincoln.

  • avatar
    05lgt

    In the interest of not being banned, I’ll choose not to quote the little devil in Animal House…

  • avatar
    Mark MacInnis

    Jack:

    She doesn’t sound like Vodka McB.’s type.

    You she’d eat like fudge.

  • avatar
    cfclark

    “Dancing with a candy cane doesn’t make your ugly-ass hipster girlfriend Katy Perry.”

    Saw this, thought “line of the day”, looked at the byline and thought, “figures”.

  • avatar
    Darkhorse

    Why doesn’t Ford just take a 9MM Glock and put a bullet through Lincoln’s head? There can’t be a more useless car brand. All the great things Mulally has done are negated by keeping Lincoln alive.

    • 0 avatar
      28-Cars-Later

      Easier said than done. What do you do with the dealer network? Just bye bye and a big finger?

      According to this article from 2011, there were still 435 dealers operating and the target was 325. Even if they have gotten to this number by 2012, that’s still 325 dealers to close and ruin the livelihoods of… sure maybe you could convert them to Ford dealers but how will the existing Ford dealers feel about that? Its not as simple as shut down the brand, but at the same time somebody must champion the brand as well.

      http://www.reuters.com/article/2011/02/07/us-ford-lincoln-idUSTRE7160OF20110207

      Lincoln is the new Mercury, its as simple as that. All they need to do is come out with one model which is worth buying, a real Continental, and the rest can be Ford clones since it evidently works. How did you feel about Chrysler before the 300? I wanted them consigned to the dustbin of history, and now some people think Chryslers are nice cars again.

  • avatar
    otaku

    I guess maybe I should go back and attempt to re-read this article in the vain hope of figuring out what it was about. I readily admit that I have almost no idea what the deal is with dealer holdback (and very little desire to correct that personal deficiency). Nevertheless, the image of a restyled/refreshed Lincoln MKS led me to think we might get some info relating to the car itself, but I guess that probably makes me either more naive than Mr. Baruth was back in ’94 or at least as much as he seems to think Lincoln management is these days, since they’re not hiring prostitutes to ensure customer satisfaction, or something…

    Just to give you an example of the level of naivite I possess, I actually believe Lincoln dealers will probably end up selling a whole bunch of their brand new vehicles if customers like the styling, enjoy the way they drive, and if the one thing Lincoln ends up NOT emulating about the overall European luxury make ownership experience turns out to be the frequency of trips back to the service department for expensive repairs.

    But then again, what the hell do I know?

    • 0 avatar
      28-Cars-Later

      “Mr. Baruth was back in ’94 or at least as much as he seems to think Lincoln management is these days, since they’re not hiring prostitutes to ensure customer satisfaction, or something…”

      I think Jack was trying to show T&A gets you one thing, it gets you paid.

      Without getting into the nitty gritty of belt-lines, headroom, fuel economy, engine power, what in the flying frack is different between a Lexus, Lincoln, Buick, Acura sedan? All bland sedans, all wrong wheel drive, and all ugly ducklings. Heck the Cadillac C coupe vs an E350 coupe may look very different but are the same type of car right down to touchscreen navi, the 300 hp V6 and an AWD option on both (I know because I recently compared them).

      So how do you get the sale over the other guy since you all basically sell the same thing? You add a little personal touch, and maybe its some T&A. Sex sells folks, and nothing spells word of mouth better than having a charming milf hand deliver some kind of trinket directly to you. Heck, those are how Penthouse forum letters start!

  • avatar
    DeadWeight

    Looks like Lincoln is putting in the real R&D and intense product development that is required to be a legitimate contender in the luxury portion of the automotive sector.

    /sarc

    Look at that newer, 300% more baleen whale mouth grill they slapped on the front of that Ford. She’s a beauty.

  • avatar
    Pch101

    Unless you think that customer service is offensive, linking holdback payments to CSI scores is a good idea.

    And yes, these dealers that aren’t paid “holdback” still get the money, it’s just called by a different name and the payment is conditional on something more than just the inventory being sold.

    The fact that an angry customer can result in the loss of the money gives the dealership to the incentive to kiss the customer’s backside. Since I’m the customer and not the dealership, this suits me just fine.

    It’s not an uncommon practice, either. Mercedes doesn’t use it, but BMW, Mini, Audi, Jaguar and Land Rover all have variations of this system. Sure, it would be nice if Ford built better Lincolns, but it still benefits the customer to have leverage over the dealership.

  • avatar
    armadamaster

    Lincoln died with the Town Car…they just haven’t buried the body yet.

  • avatar
    dougjp

    Is this Lincoln’s way of culling dealership numbers? Getting rid of the dealerships that are stand alone Lincoln ones I mean?


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