Can the MKZ resurrect Ford's luxury Lincoln brand?
DEARBORN- Ford Motor Co.’s struggling Lincoln brand could finally be on a road to success.
Following years of lackluster products and sales, the luxury brand last month experienced its first substantial year-over-year sales increase in more than a year -- led by the 2013 MKZ midsize sedan.
Since introducing the prototype model at the 2012 North American international Auto Show in Detroit, Ford executives have touted the MKZ as the “new DNA” meant to resurrect the once prestigious brand.
“As we have been saying since January, April and the second quarter of this year are good proof points for the appeal of MKZ as inventories normalize throughout the country,” said Ken Czubay, Ford vice president of U.S. marketing, sales and service, last week during the automaker’s April sales conference call.
Extended product testing and quality issues at the MKZ’s production plant in Hermosillo, Mexico, caused some dealers to wait months to reach a normal inventory. April marked the first time, according to Ford executives, dealers were fully stocked with the midsize sedan since its official launch in December.
For now, the wait appears to have paid off. MKZ sales for the first time topped 4,000 in April, up 115 percent compared to April 2012 and it was one of the fastest-selling vehicles of any Ford product – turning in 22 days, with just 11 days for MKZ hybrid.
Due to the selling rate, Ford plans to increase its hybrid mix from 20 to 30 percent for the 2014 model year. Czubay said Ford did not have a breakdown of how many sales last month were from pre-orders, but said a “significant number” was new traffic.
April marked the first time since August 2012 (when sales were up 2 percent) that Lincoln’s sales were up from the previous year and the first double digit increase since February 2012, when sales increased 16 percent.
“I think this is the beginning of a positive trend for Lincoln,” said Alec Gutierrez is the senior market analyst of automotive insights for Kelley Blue Book. “If you look at that current MKZ versus the one it is replacing, the cars aren’t even comparable.”
In 2012, MKZ sales declined 33 percent from 2011 to only 1,630 units sold. It was the second best-selling vehicle for the brand – representing about 22 percent of all sales last year.
Gutierrez and other industry analysts aren’t completely sold on the MKZ being the savior for Lincoln, but believe it’s definitely a turn in the right direction.
“The MKZ is a great car,” said Jesse Toprak, TrueCar.com senior analyst. “It’s not surprising that it did well.
“The challenge with Lincoln continues to be a brand challenge. Not the product portfolio.”
Lincoln’s “brand challenge” could continue to improve if future products truly stick to the “DNA” of the MKZ, according to analysts.
The MKZ is one of four new Lincoln’s coming in four years. The second is expected to be the MKC, which Ford showed a prototype of at the 2013 NAIAS in January.
The MKZ is already bringing new, younger buyers to the brand. According to Edmunds.com senior analyst Jessica Caldwell, buyers between 35-44 years old have increased 8 percent and the highest average salary of new MKZ owners is above $150,000,
“When they say they’re selling to a different customer, when looking at the numbers, it looks like they are,” she said.
Edmunds.com reports Michigan remains the vehicle’s largest market, followed by California – an extremely important car market – and Texas.
And while some haven’t been too thrilled with the MKZ or have doubted the brand’s future, Ford appears to be confident the “new DNA” of Lincoln will resurrect the brand.
“The new Lincoln brand will be defined by great new luxury vehicles, such as the new MKZ, that feature quality, unique style with substance and innovative technology,” said Ford CEO Alan Mulally in a previously released statement.