Ford CEO Mark Fields said the Continental plays a "critical" role in the revival of the Lincoln brand, including driving sales in China.
Hoping to regain their once-lofty positions in the hierarchy of global luxury brands, Cadillac and Lincoln launched two critical new products at the New York International Auto Show this week. But while the new Cadillac CT6 and Lincoln Continental might be on display in the Big Apple, the two makers are also hoping that Chinese buyers pay close attention.
That’s because China is expected to become the world’s largest luxury car market within the next year or so – and it already leads the world in the purchase of premium luxury models, such as the big CT6 and Continental, noted Ford Motor Co. CEO Mark Fields.
China, Fields noted, is a “critical” piece in Ford’s planned revival of the long-neglected Lincoln brand. And Johan de Nysschen, the new global president of General Motors’ Cadillac division has similar expectations.
The two Detroit-based brands dominated the luxury market during much of the 20thCentury, but began to lose momentum to key import rivals like BMW and Mercedes-Benz as the new millennium approached. Today, Cadillac sells barely as many vehicles worldwide as BMW sells 3-Series sedans. Lincoln, in turn, has been generating barely a fraction of Caddy’s volume as it struggles to get by with a minimal line-up.
The Cadillac CT6 is the brand's flagship and it expected to garner favor with Chinese buyers as well.
The new Continental, however, is part of a plan to grow the Lincoln model mix. It is the latest of four all-new vehicles introduced in the last several years, with two others soon to follow. The Continental replaces the slow-selling MKS sedan, moving up-market to more directly tackle luxury import flagships like the BMW 7-Series, Audi A8 and Mercedes S-Class.
Cadillac has similar aspirations for its new CT6, which is one of eight all-new models due out by the end of the decade, said de Nysschen.
Sales of premium luxury vehicles are modest compared to midsize and compact models, but they are expected to grow by 10% by decade’s end, according to Ford CEO Fields. And much of that growth is coming from China, where demand for vehicles like the Audi A8 surged 17% last year.
Such vehicles also provide a halo for a brand looking to get consumers to take it seriously.
(Born again: Lincoln revives the Continental. For more, Click Here.)
Lincoln is a newcomer to China. While some products have been imported for years through the so-called gray market, it only opened its first official dealer late last year. It has now has 25 stores open there, “and we plan to grow that to 60 dealers in 50 cities by the end of next year,” Fields noted.
China is expected to be the world's largest luxury car market in the world soon so the Continental's success is even more important to the brand's survival.
Cadillac has been on sale in China only a little longer, but it took a critical step recently, setting up an assembly line there. That move helps it avoid hefty tariffs on imported vehicles. According to de Nysschen, the CT6 will eventually be produced in China, as well.
(Click Here for details about Continental and CT6 going head-to-head in NYC.
While Lincoln officials wouldn’t confirm the move, they also are expected to set up production of at least some models in China in the next several years.
Cadillac will follow up its closely watched New York debut of the CT6 sedan with a second preview at the Shanghai Motor Show later this month. It is saving some news for that show where it plans to officially announce the addition of a plug-in hybrid version of the flagship model – a story first broken this week by TheDetroitBureau.com.
(For more on Cadillac’s plug-in hybrid plans, Click Here.)
The CT6 will be about the size of BMW 7-Series but weigh barely as much as a 5-Series.
Adding a plug-in has a number of potential advantages in China, de Nysschen explained. Among other things, it means a buyer doesn’t have to wait to register a new vehicle in cities like Shanghai and Beijing – where authorities are trying to slow the growth of the car market to cope with worsening traffic and smog problems.
Eventually, China could become the largest global market for Lincoln, Ford planners have suggested. Cadillac hopes for similar success. But despite its robust growth, Chinese buyers have been difficult to predict. Mercedes faced several years of setbacks, a problem that led to a major management shake-up. Whether Cadillac and Lincoln can fare better is far from certain, but they are betting their new CT6 and Continental flagships will help build some much-needed momentum.