Lincoln, Cadillac battle luxury rivals

Faded US luxury brands Lincoln and Cadillac are finding a new cachet in China, a lucrative market that could help power their comeback against German and Japanese rivals back home.

Ford is banking on this momentum to steal the thunder from Volkswagen's Audi, BMW, Toyota's Lexus and Daimler's Mercedes-Benz, which dominate the US luxury market, when it unveils a new version of the iconic Lincoln Continental at the Detroit auto show Tuesday.

The Lincoln Continental, first introduced in 1939 and pulled off the market in 2002, will return to replace the luxury MKZ sedan in an updated version equipped with a six-cylinder, 3.0-liter engine, according to a concept car presented at the New York auto show early last year.

The split, winged grill will be replaced by a single, centered chrome grill. The car will be offered in front-wheel drive with an option for all-wheel drive, US automotive media have reported.

Lincoln also wants to distance itself from the pack by promoting its consumer services packaged in the "Lincoln Way" program.
"We want to tell the story of the brand," Kumar Galhotra, president of the Lincoln division, said in a phone interview.

Clearly, the company wants to capitalize on the Continental's prestigious past, when it was the vehicle of choice for US presidents from the 1960s to 1980s.

The Continental will be marketed in the United States and China this year, but not in Europe.

- Still coveted in China -

Both Lincoln and Cadillac, the premium division of General Motors, are finding their reputations still have weight in the world's largest auto market, China.

Cadillac sold 62,630 vehicles in China by the end of October, 13.3 percent up from 2014.

Lincoln, in its first full year in China, sold 11,630 vehicles in 2015 and already has a network of 33 dealerships that it plans to double by 2020.

In the United States, the two legendary brands also seem to be regaining some allure.

Sales have grown, stemming some of the bleeding inflicted by the crushing domination of the European and Japanese luxury brands over the last decade.

Cadillac sold 175,267 vehicles last year, a gain of 2.6 percent from a year ago. Lincoln reported 101,227 vehicles sold, up a solid 7.1 percent, in line with the luxury market's 7.7 percent rise.

By contrast, BMW, the top luxury brand in the US market, saw sales gain last year by 1.8 percent, to 346,023 vehicles.

"Overall the luxury market is doing well," said Karl Brauer, an analyst at Kelley Blue Book.

While luxury cars represent only 10 percent of all vehicles sold in the Untied States, they generate 50 percent of profits because of their large profit margins, according to analysts.

Both Cadillac and Lincoln know they need to lure young, hip, well-heeled customers, rather than their parents. It is a challenge: in 2014, the average Cadillac customer was 59.5 years old, according to IHS Automotive.

Last year, Cadillac moved its headquarters to New York's trendy SoHo district in Manhattan, and features this new staging ground in its advertising.

Polishing its modern image, the 113-year-old brand became the first automaker to partner with New York's inaugural men's fashion week last year.

Cadillac is offering personalized models in each luxury segment, borrowing a successful tactic used by German competitors.

The brand has targeted the sale of 500,000 vehicles per year and will create eight new models by 2020.

Ford meanwhile plans on four new models and annual sales of 300,000 vehicles by the end of the decade.
Source: AFP