Chasing the Dragon: Lincoln's Plan to Capture the Chinese Market
While both Buick and Cadillac have a healthy lead over Lincoln in terms of domestic deliveries, the space between them is far more pronounced in China. At home, Ford moved 111,159 examples of its premium marque in 2017 against Cadillac’s 156,440. However, China’s Caddy sales clocked in at 175,489 last year — a number Lincoln could only muse about in its wildest fantasies.
That’s because Ford exports all of its luxury vehicles to China, while GM tends to build them locally. But the Lincoln brand shows a lot of promise in Asia. Ford moved roughly 80,000 vehicles in the People’s Republic in 2017 and 54,124 of those models wore the Lincoln cross. In theory, if Ford could localize and bolster its product lineup within the country, a higher volume would be all but assured. It’s a theory the automaker intends to test, too.
According to Reuters, the Lincoln brand intends to build as many as five new vehicles in China by 2022. Officially, Ford has only said there will be a Chinese crossover by the end of 2019, but sources say Lincoln will also build the Aviator in China by the start of 2020, along with the successors to the MKC compact crossover and the MKZ midsize sedan. Following those models in 2021 is the Nautilus, which replaces the MKX.
Another small Lincoln crossover might enter Chinese production in 2022.
“Our localization plans to support the China market are on track and will serve to further drive Lincoln’s growth in China,” explained Lincoln spokeswoman Angie Kozleski. “Beyond that, it would be premature to discuss our future product and production plans or timing.”
With China still running a 25 percent import tariff on cars, Ford literally can’t compete with GM in that market by shipping cars from America. Even if the country softens the fee, which President Xi Jinping has promised, there’s no guarantee it will be enough to level the playing field. So Ford intends to build more cars in China, rather than gamble on bolstering U.S. output and attempting to export a gaggle of new models.
However, sources claim Chinese production of the first Lincoln-badged vehicles won’t commence for at least another 18 to 24 months. Ford is already playing catch-up, as the Lincoln brand only entered the Chinese market in 2015. Meanwhile, Cadillac has been there since 2004, allowing itself to establish a stronger dealer network and set up factories in-country. China is now the brand’s largest market by volume.
Lincoln wants a taste of that action and better access to the country’s 1.37 billion prospective customers, but the only way to do that under the current trade laws is to set up shop there.
What will this mean for America? Well, there is a chance Ford could eventually shift production of specific models exclusively to the People’s Republic, resulting in “American-made” Chinese exports — like the Buick Envision or the Cadillac CT6. Powertrain offerings will likely be highly influenced by the country’s strict electrified vehicle mandate. A significant portion of these new Lincoln vehicles have hybrid variants.
Really, Lincoln had no choice. China has surpassed the United States as the world’s largest new car market and businesses aren’t in the practice of not chasing down money. “As long as Lincolns are not manufactured in China, the brand’s sales will no doubt suffer continuously,” said Zhu Kongyuan, Secretary General of the China Auto Dealers Chamber of Commerce.
[Image: Ford Motor Co.]
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