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Dealer Council Feed Back on Lincoln Brand

14K views 190 replies 27 participants last post by  syr74 
#1 · (Edited)
For Lincoln dealers, 2013 started as a tough year when production problems and quality glitches forced a three-month delay of the MKZ sedan, a car they needed badly. Bill Knight, who is entering his second and final year as Lincoln dealer council chairman, believes better times lie ahead in 2014.


Knight talked with Staff Reporter Bradford Wernle.


Q. How was 2013 for Lincoln dealers?

A. Clearly from a volume standpoint it wasn't what we had planned or what the objective called for. Year-over-year the volume was flat in a luxury industry that continues to grow, so it certainly was not what the company or the dealers wanted.

But if there's a bright spot, profitability for the Lincoln dealer improved 30 percent in 2013. A lot of that can be attributed to some of the invoicing actions that we took back in 2012.

We're certainly not where we want to be on volume. But it has been awhile since profitability for Lincoln dealers was up 30 percent.

How does 2014 look for Lincoln dealers?

There's a lot of positive news about the MKC. The reaction of the press to the unveiling has been really positive. It shows the continued commitment on the part of the company to provide differentiated vehicles for Lincoln. The MKC is the best example of that. The MKZ got criticism from the media that it was too close to the Ford Fusion. We're not hearing any of that on MKC.

It's an incremental product for us, which we need, and it hits at a very exciting time. The segment it hits, there just aren't a lot of players. This is the type of product that sets us up well as we continue the journey.

In what areas would you like to see improvements?

We continue first and foremost to challenge the company to increase the breadth and depth of the product lineup, whether it's a third-row SUV or CUV or a small sedan.
We recognize it just takes time. We continue to have dialogue with the company to get throughput for the dealer network.

Any specific vehicles you'd like to see added?

The thing we don't have is a mid-sized SUV or CUV that has a third row. We don't have a volume entry in a third-row SUV. As those segments continue to grow, when you look at the other luxury players moving down to that B- and C-car segment, those are things we hope the company can look at going forward.

What about the MKT? Sales have been very slow.

It is certainly polarizing. From a dealer perspective, we're not in a position to tell the company we don't want certain products. The MKT fills a small niche. It's certainly not providing the volume or throughput we need. We are selling some of them. We're anxious to see what the company's plans are.

The MKZ launch was delayed. Lincoln has admitted the launch was botched. How well has Lincoln recovered from that episode?

I think the company learned a lot from that. It certainly wasn't what the company planned, nor was it what the dealers expected. But we got through it.

The company did some unprecedented things by providing cash payments to the dealers most affected. Clearly it was something we didn't anticipate and don't want to go through again. It showed we can have collaboration and constructive conversations. The company will take those lessons learned and apply them to the launch of the MKC. We're confident that it won't happen again. They were launching the MKZ right after the Fusion. The Fusion was a complicated launch, and that got more complicated because of the MKZ.

Read more: http://www.autonews.com/article/201...-lincoln-sees-better-days-ahead#ixzz2rSShNMge
Follow us: @Automotive_News on Twitter | AutoNews on Facebook[/QUOTE]
 
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#2 ·
I don't get why Lincoln dealers will have to invest money to sell the Black Label interior. I know the Black Label will be much nicer interiors, but in the end it's just an option package.

Overall, the article tried to put a positive spin on Lincoln, but I could almost feel the tension of the unhappy dealers.

It's sickening to hear the dealers/Ford inferring there isn't any money ("costs money to change the confusing names") when Ford is recording billions in profit. They need to divert more of that profit into Lincoln.
 
#3 · (Edited)
I see it a little differently.

For all the faults of Ford and its terrible launch of the MKZ, Lincoln dealers actually realized a 30% increase in profitability last year.
You could imgine that as being a good concillation prised but yeah, I get that Ford's foul up cost lincoln dealers a lot of profit in 2013.
The signals are there that 2014 will be much better - but it needs to be if Ford wants its Lincoln dealers to invest in high end experience.

Ford should be listening to their Lincoln dealers more closely in terms of products needed and vehicle names, MKT is just terrible
but a properly presented Aviator (Explorer with 117" wb) would turn things around just like that and get Lincoln dealers
back in the game... as would a Lincoln Tracer - yes be brave and maybe use some Mercury names.

A compact sedan and Utility, a Mustang variant, a new Aviator and Lincoln might stand a chance of making people believe
it is a company under change. At least lincoln dealers would have something to crow about.....

To me "Black Label" is more than a trim option, it's more about identifying high end customers, changing the buyer experience
to more closely suit them and their needs and then presenting combinations of vehicles, materials and features that make those
buyers feel like Lincoln is building a vehicle just for them - yes it sounds like schmooze but if Lincoln ever wants to get back to
being the posh brand it once was, I can think of no better way than undoing all the bad habits dealerships are renowned for.
 
#4 ·
Dear Lincoln,

• If you're going to stick to the crappiest naming convention out there, at least rejig it some. Replace "em-kay-zee" with "mark zee", et cetera, to give a proper "Lincoln" sound. Cars don't have to have proper names, but the current nomenclature just comes across as a random jumble of letters. Try to make them make sense.

• Better advertising than what I saw the other night with the couple "interviewing" the MKZ and Lexus.

• Three-row crossover. Not all wealthy buyers have 2.2 kids; some of us breed like roaches. Don't make it any bigger than Explorer. And make sure it's not as dour and nasty as that wallowing Infiniti heap.

• If you do a small car, give it SOMETHING to make it stand out. Verano's nicely executed, but it looks like a truckload of ass... CHEAP ass. Remember that lovely little "C" concept? Draw from it for inspiration. Hell, forego the whole traditional car idea and make something MPVish. Upscale buyers tend to be better educated, and better-educated buyers are more likely to appreciate function over form.

• Totally digging the new dealerships. Classy without being all froufrou and douchebaggy like mgescuro's beloved west-coast Lexus dealers and the way they laughingly lick the boots of the pretentious Niles-and-Frasier types.

• Adopt the Flex when Ford gets tired of it. Don't let this amazing car die. I'll buy the first one off the transporter.
 
#8 ·
I'd Really like to see Lincoln prosper, so hopefully they will give the dealers the product they need to grow the brand again. The MKZ is a pretty nice car but it doesn't say Lincoln to my eyes. Actually something along the lines of the Cadillac Elmraj would be more appropriate IMO. Some of the concept stuff that Land Rover chief of design Gerry McGovern did when he was at Lincoln was the correct direction afaic.
 
#9 ·
Went to the Washington D.C. Auto show yesterday I don't know whether this is any indication of Lincoln's future but,

The Lincoln display area had Mercedes on one side and Cadillac on the other. Both had crowds looking at, and crawling through their product. The new Escalade was drawing a crowd...Lincoln was DEAD. I mean NO one was looking at their product. It was like the display area was sitting in the middle of quicksand. Could it be that the MKZ is last years news, the MKS is a rebadged Taurus. Hell, no one was even looking at the concept MKX SUV. You know you must be in trouble when there are more Lincoln people there than viewers....
 
#23 · (Edited)
MKS ..., when does it get redone?. When do all the D3/4 cars get a new chassis?
Barring a surprise (which is not impossible), we should see the replacement sometime next year
with it going on sale early in 2016cy as a 2017my.
Afaik the D3/4 platform will cease about that same time.
 
#21 ·
That's solid reasoning, but my counterpoint would be that (as far as I can tell) Ford is not showing much success, or desire, in closing down or updating dealerships, specifically in the last couple years. Meanwhile the the brand is backsliding here in the U.S due to weak product, which could poison the well in China.
 
#22 ·
I know that Ford had gotten more than half of the major, metropolitan dealerships to agree to upgrades and relatively serious process changes through 2012, and that they had cut dealerships in that same market by about 35% during that same timeframe. And IIRC they had made similar progress with regard to cuts in more rural markets as well during that same period, but I haven't seen any hard data on these same issues through 2013 as yet. I suspect that 2013 was something of a transition year in this regard with Ford moving from a more heavy handed approach to getting what they want from the dealerships body to dangling carrots in an effort to move toward a positive reinforcement point of view, because that seems to be where they are going with things like Black Label. And I don't see product being a problem in China moving forward so long as Lincoln sticks to the path the MKC predicts, because other than the MKZ and possibly the Navigator the product China will be getting will all be post MKC and newer product.
 
#27 ·
^ & ^^
it might be a bit more compltcated than that
just-imho / still waiting for some info
 
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#30 ·
tho my absolute favorite rant is for an Electric-&-Energi MKE
I *do* base it on the Grand C-Max's longer wheelbase

:eyebrow wiggle:

pre-edit
that would also make the littlest Lincoln a specialty car starting no lower than $40k
instead of a cheapo-anything
 
#31 ·
This is interesting.

From a marketing perspective, the Ford brand is incredible (I cannot tell you how many times daily or weekly the first question people ask is "do you have that tailgate I can open with my foot or...?"), but Lincoln does not.

A good example now are their ads with a Lincoln nose to nose with a competitor car in a room. Not a bad idea. But it's all "mine is bigger than yours" but that isn't the case for any Lincoln vehicle right now. The latest comparing an MKZ to a new 2014 CTS...umm, no. ATS? Maybe. Even that is a stretch. CTS...not even worth mentioning. It's a great looking car, but the Fusion is too nice and the MKZ is a downgrade in some areas, it's just a fancy FWD sedan. You can do those and do them well, but the MKZ still just comes across that way at the end of the day.

New stuff always helps. Look at Cadillac, for example, and how long it took. Hopefully Lincoln can do better taking along that great image and marketing Ford has right now...it will help. Product will too.

We'll see.
 
#32 ·
Hybrid and electric cars need to be small and goofy looking. We wealthy customers buy luxury cars as a reminder to the common rabble that our s--- don't stink. Can't do that in a dressed-up Prius or Volt. Lincoln is best served avoiding this segment.

Levity aside...

The worst thing about those lame "interview" ads is that that MKZ isn't presented with a substantive litany of features that betters its competitor, but rather two or three relatively unimportant features.

"MKZ has a bigger glove compartment than Buick LaCrosse".... :ponder:
 
#33 · (Edited)
Lincoln dealerships that have Ford know 95 percent of sales will come from the volume brand. But the stand-alone dealers are different. What more can Lincoln do to help the stand-alones?

I'm a stand-alone. You could argue if you're a stand-alone you have to be engaged, because that's what's paying the bills.
The differentiation I see is those who are engaged and those who are not. For those that are, we've made good progress.


If I look at my situation, the tools that Lincoln has provided us over the last 18 to 24 months have transformed the experience I'm providing my clients on the showroom floor and service drive. It's very different from a personalized service client experience standpoint than at my Ford dealership. That has allowed us to bring the conquest customers we're trying to find and it's also allowing us to increase our service business. The training in hospitality is allowing us to provide a very different experience than Lincoln has provided before. It is hard work to engage your team to get where we're going. It can be done. Our employees have thrived with our Lincoln Academy. It allows us to do special things for our clients

The client experience in sales and service has to be fully separated from Ford. Have we made mistakes? Sure. For those dealers who are engaged and use the tools provided, they can change. We don't have a choice. We have to make this work. When I look at what we're providing on the service drive, it's completely different.


Read more: http://www.autonews.com/article/201...-lincoln-sees-better-days-ahead#ixzz2rlf0YD2h
 
#37 ·
If the linchpin for Lincoln's future hinges on a right-sized dealer body that can generate revenue sufficient to support a top-shelve customer service, then the current strategy is stalled at best and circling the drain at worst; they can't force out dealers fast enough to compensate for downward sales. All the low hanging fruit (the easily forced out dealers) have been plucked. It's an insane strategy, or at best one that has poorly executed over the years. It's almost like they are going to make dog-***** product just to strangle dealers OoB. Obviously I'm going to point out that Cadillac has about the same number of major market dealers as Lincoln, but I don't think it's going out on a limb to speculate that those dealers have twice the sales and higher ATPs due to a product-first approach. Theoretically they can afford to up their game.
 
#38 ·
MKC is a d0g-$h1t product? Tell me about the numerous compact luxury crossovers that are better products?

Let me break it down. This strategy is JUST beginning, so calm down with drawing conclusions about its success.

1) Require dealers to upgrade or leave. This will right-size the dealer body.
2) Focus on high-volume, lower and middle market luxury products to give the remaining dealers the revenue they need to prosper
3) Customer perception of Lincoln rises due to excellent dealer experience and good products
4) Move the brand upmarket with higher-end products
 
#39 ·
The MKC is such a knock-off of the Audi Q5 that it reminds me of something a Chinese company would do, except with first-world engineering. It is a non aspirational car for house wives that I think will sell well but won't carry the brand.

I feel like "this strategy" is just a rehash of the 2010-era strategy when the MK-renaissance was supposed to happen because of the MKS, MKT, and MKX.

1) Franchise laws. If this was possible Ford would have done it years ago. All they got are carrots lefts.
2) Those are well and good but luxury CUVs sell better when have an actual luxury brand.
3) Customer service is not enough of a differentiateor to bring in many new customers. It's not a killer ap.
4) Product should never be forth down on any list, and is more important than marketing and customer service. The industry is too competitive for that.
 
#40 · (Edited)
I think the fears that circulate on several automotive forums, including this one, regarding Lincoln product issues are blown well out of proportion at this point. If the MKC is any indicator of what the revised MKX and upcoming MKExplorer are going to be like, and I'm certain that they are, the brand and dealerships being profitable won't be an issue moving forward to say the least. Near term the bases are covered more than well enough in terms of product.

As for moving Lincoln further up the luxury food chain being more important than marketing and customer service? Not in this segment. Lincoln has already made significant advances in dealer structuring, size, and customer service and the approach they are currently taking should allow that to continue. Not only would I not speed up the cadence of product evolution, at this point I would argue that would be one of the bigger mistakes that they could make.

Look at it this way. A good portion of the people on this forum spend their days drooling over the new CTS, but imagine what the effect of people moving from an E Class and into a CTS only to find that the level of customer service on their new ride is on par with what the guy in the Sonic on the other end of the parking lot is getting would be. The problem with this scenario is that most people buying the new CTS couldn't tell the difference in the handling of that car and a new Lexus ES on a bet, but you can be sure that they can recognize the difference in customer service levels between the typical Mercedes/Lexus/BMW dealership and what they get at their average, local Cadillac dealership. Anybody who thinks that won't be a massive problem for Cadillac moving forward cannot possibly be familiar with that portion of the industry. It is well and truly a potential disaster in the making.

Whatever we may think of their methods the reality is that Lincoln has recognized this same fundamental problem within their own dealership body and is reacting to it proactively prior to any attempt to move their product significantly upmarket. And in another ten years, I think we'll see people on these same forums looking at Lincoln and Cadillac only to see something very different than what they expect to see.
 
#43 ·
The problem with this scenario is that most people buying the new CTS couldn't tell the difference in the handling of that car and a new Lexus ES on a bet, but you can be sure that they can recognize the difference in customer service levels between the typical Mercedes/Lexus/BMW dealership and what they get at their average, local Cadillac dealership. Anybody who thinks that won't be a massive problem for Cadillac moving forward cannot possibly be familiar with that portion of the industry. It is well and truly a potential disaster in the making.
Pretty much sums it up. Lincoln is employing a pretty sizable team of advisers, hired from companies across the luxury spectrum (cars included), and that was the overriding message... the dealers must be fixed before product can come, otherwise you're sending in great products to die in dealers that can't sell them. The death of the Lincoln LS had as much to do with Jaguar's interference, as it did that dealers couldn't figure out how to sell them alongside similarly priced Town Cars.
 
#45 ·
All i'm saying is that if your reasoning is that dealer profitability drives improved customer service, bare in mind that Cadillac and Lincoln have similar dealer numbers in the key markets but Cadillac dealerships move at least twice as many cars, because Cadillac has, you know, credible luxury cars with improved sales. This creates a positive feedback loop. Expecting dealers to up their game isn't really fair if Ford isn't willing to up theirs.


Also, I'm curious as to how Lincoln dealers upped their profitability 30% if sales were down, ATPs were stagnant, and the number of dealerships didn't change significantly. Sounds like a nice round BS number.
 
#47 · (Edited)
^^
...Also, I'm curious as to how Lincoln dealers upped their profitability 30% if sales were down, ATPs were stagnant, and the number of dealerships didn't change significantly. Sounds like a nice round BS number.
imho it's not hard to understand:
customers bought very slightly fewer vehicles which averaged a bit over 30% more expensive

with the MKZ production sorted out and no other changes = a further 25% increase for 2014
BUT
they're adding the MKC, plus the remade Navigator (which imho is beautiful) plus beginning [BlackLabel] in the Fall;
all of which shouild be be good for +50% over last year, just-imho

Jpd said:
...that's why the dealer council is pushing Ford to give them the products they want, it just takes time.
MKC is a great start and combined with MKZ, a refreshed MKX and navigator should see Lincoln dealers with smiles on their faces.
I wonder if a pure-down-to-earth negociation occured between dealers and FLincMoCo reps? to wit:
dealers -
"what can we do to get you to speed up product intros? huh?"
LMC - ......well I have no idea what they'd say...
 
#49 · (Edited)
Think about it, ATPs don't have to increase 30% for dealer profits to increase 30%.
The '13 MKZ was very good for Lincoln dealers, it was the shot in the arm they were waiting for
but what a shame they didn't get those first four golden months in, that would have been gold.

The same analogy also means that Cadillac dealers would now be making serious profits...silence is golden.:)
 
#51 ·
free_energy0 said:
I'm not following your math because ATPs weren't up meaningfully, especially not 30%. If it's true it's Ford taking the hit and giving epic bonus payments.
MKZ pushes Lincoln dealer profits up - Detroit News
February 1, 2014
Karl Henkel

A profitable new MKZ sedan boosted Lincoln dealer profits last year, despite the lowest number of cars and SUVs sold in recent history.

Sales of Lincoln vehicles overall fell 0.6 percent in 2013 to 81,694. But a 15 percent rise in sales of the luxury brand’s most popular vehicle, which is selling for about $6,000 more than during the previous year, has Lincoln dealers hoping that the brand’s reinvention — which could include sales gains of 20 percent this year — may be ahead of schedule...
 
#53 · (Edited)
Well duh, there's more profit in Mexican built MKZ than US built MKS and MKT....

Where is that GMI contempt for Ford based Lincolns when we need it,
MKZ based on a $22k Mexican built Fusion up against MKS/MKT based on ~$30K US / Canada built Taurus/Flex...
Replace sales of MKS/MKT with MKZ and the profit for Ford and its Lincoln dealers goes up...

The dealer council, has said that Lincoln dealers saw a 30% rise in PROFIT in 2013,
why keep disputing what the council is saying publicly?
A profitable new MKZ sedan boosted Lincoln dealer profits last year, despite the lowest number of cars and SUVs sold in recent history.
MKZ is high profit.
 
#54 ·
I'm disputing it cause it doesn't make sense. 30% is too big of a percent increase at the dealer level when ATPs and sales are pretty much unchanged. Even if there was new found margins to be made from cheaper production, that would be Fords, not the dealers. If revenue is the same and the dealers are supposedly making a third more, then either Ford lowered the invoice to the dealer (this would probably be online somewhere), or dealer installed options are vastly more lucrative on the MKZ versus the cars it cannibalized (I can't see this coming close to 30%), or Ford is giving big time incentive payments to select dealers that it likes (most likely the biggest factor for key dealers, combined with the rule of small numbers, i.e Lincoln dealers made so little last year that it's easy to get big percentage gains).
 
#57 ·
Roy, you give the buying public way too much credit.

They don't know what end propels the vehicle. They do not know if their vehicle has a 4-6-8 cylinder. They do not know that the Fusion and MKZ share the same platform.

We know. Enthusiasts know. You know, the kind of people who rarely buy a Lexus ES. Magazines know.................. and crow about it every chance they get. The vast majority of those who buy the car, or who consider the car, have no clue.

The reality is, the cars look nothing alike. While they have similar proportions................ to the layman, there is no clue that they are the same platform. We can argue about it until we are blue in the face. I show my Mom (who's automotive knowledge consists of where to put the key and the gas) the MKZ. She says "wow, nice Lincoln." I show her the Fusion, she says "that's a good looking Ford." She had no idea that they were related in any way. However, if she wanted a new car, she really liked the MKZ. Scientific................ nope. Real world................. yep.
 
#59 ·
I disagree, people are (mostly) not stupid. Lincoln's been a nonstarter because of it's flagrant use of Ford platforms; if it didn't work over the last five years, why is it going to work in the next? There are limits to how well you can polish a turd. Numerous reviews of the MKZ have basically said just get a loaded Fusion. Outside of the hybrid, this rebadge strategy shows little conquest and Lincoln remains a car for red state soccer mom and old folks.
 
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