Remember the Cadillac Cimarron?
It was designed to be Cadillac’s answer to the sales threat during the early 1980s from the increasingly popular German luxury car manufacturers; Mercedes Benz, BMW and Audi. And while it looked good on paper (at least to GM’s finance and accounting folks), it turned out to be an unmitigated disaster. GM tried to “badge engineer” their J-body economy car platform into a Cadillac and its flaws were so obvious that for the first couple of years it was advertised as “Cimarron by Cadillac”–not officially a Cadillac (but unfortunately for Cadillac dealers, they were stuck selling the car). The strategy failed and by the time the Cimarron went out of production, Cadillac had lost almost half its luxury car market share.
So why do I mention this now? Because Ford has been making waves recently about their sweeping make over of their Lincoln brand–similar in many respects to what GM touted to car buyers thirty years earlier with its Cadillac brand. Of course Ford won’t admit the similarity; rather, they talk about the myriad redesigned cars that are in the pipeline and how they will try to create a “new experience no customer has ever had.” According to a recent Wall Street Journal article:
Later this year, Ford will begin a sweeping make-over of the 96-year-old brand, to give staid Lincoln a new identity as a producer of high-tech, understated luxury cars, Ford executives said.
The first look at Lincoln’s future will come in November when Ford unveils redesigned versions of its MKS sedan and MKT sport-utility vehicle, the first of seven new or redesigned Lincolns. The MKS will feature a sleeker design, self-tuning suspension system and hands-free controls and entertainment system.
Whizzy technologies that the auto maker is counting on to turn heads: retractable, all-glass roofs and computerized sound-reduction technology, similar to noise-cancelling headphones, to block road noise and make Lincoln interiors ultra quiet.
“Lincoln will give [customers] opportunities to tell a story about what is unique in their vehicle,” said Derrick Kuzak, Ford’s head of global product development, in an interview. “You think of BMW as engaging to drive; you can think of Lexus as refined. Bring them together and it is a new experience no customer has ever had.”
But the dirty little secret is that these redesigned Lincoln models will, for the most part, simply be upgraded versions of the same cars sold as Fords. The “sleeker designed” MKS sedan that Lincoln hopes will complete with the BMWs, Audis and Lexus’ of the luxury segment is a Ford Taurus with “unique exterior panels, headlamps and other touches to give the car a distinct look.” And the Lincoln MKX crossover is nearly identical to the Ford Edge. Does this strategy sound familiar? It sould, it comes from the same playbook that GM used to roll out the Cimarron.
For a strategy that even Ford concedes is the “last chance” for Lincoln to re-establish itself as a leading competitor in the luxury-car segment”, one would think that Ford would have learned from GM’s disaster a generation earlier of relying on “badge engineering” rather than building a true luxury vehicle that today’s consumer really demands.
So how is the strategy working out so far? In the first five months of the year, U.S. auto sales have increased 14% over a year ago, but Lincoln’s sales are down 7.5%. Not looking good.
Here’s the takeaway: For the Lincoln car brand to prosper (or even survive), Ford needs to avoid at all cost any appearance of badge engineering–the perception that Lincoln automobiles are simply Ford models with a few extra gadgets. While the strategy of sharing platforms across different divisions may appeal to the bean-counters, it won’t appeal to today’s sophisticated luxury car buyer.
