One is an entry-level luxury sedan that has helped re-energize Lincoln car sales. The other is about to enter the crossover marketplace later this year. Both carry the challenge of re-defining 21st century luxury within Ford Motor Company’s Lincoln brand.
The 2006 Lincoln Zephyr mid-size sedan and the 2007 Lincoln MKX (pronounced "Mark X") crossover utility vehicle (CUV) are both considered "game-changing" products as Lincoln moves to be America’s luxury brand.
With more than 12,000 units sold so far this year, Zephyr has helped boost overall Lincoln car sales 22 percent while delivering a 41 percent conquest customer rate.
"We are extremely pleased with what Zephyr has been able to deliver," said Tom Grill, Lincoln brand manager. "The average life expectancy of a Zephyr on a dealer lot is 18 days, and it has also been holding its residual value. We’re doing it because the design is right, the packaging is right and quite frankly, the volumes are right."
"Nothing replaces cutting-edge product that is priced right," said Ed Witt, owner of Witt Lincoln Mercury
in San Diego. "For a loaded Zephyr, an MSRP at around $35,000 is a tremendous value. I can’t keep them in stock. I never have more than two or three units on the ground at any time since the car has been out."
Lincoln will build on Zephyr’s momentum with the launch of the new Lincoln MKZ this fall — complete with a more powerful V-6 engine, a newly designed front end, more traction with available all-wheel-drive (AWD), along with the new name. The MKZ’s new Duratec 35 engine, paired with a 6-speed transmission, will deliver 250 horsepower and 240 pound-feet of torque.
"Despite Zephyr’s sales success, there have been some naysayers out there who have questioned Zephyr’s horsepower," said Grill. "When we launch the MKZ that question will be answered. With all of the improvements planned while still starting at under $30,000, all in the first year life of the vehicle, that’s game changing for Lincoln."
With the upcoming launch of the all-new 2007 Lincoln MKX late this year, Lincoln is "crossing over" to where the customers are.
As a five-passenger CUV to be powered by an all-new 3.5-liter engine with a six-speed transmission, the MKX gives Lincoln its first entry into the red-hot crossover market. Many analysts have predicted that CUV sales would overtake those of traditional SUVs by the end of the decade, and some feel it will happen this year.
"CUV sales have grown from about 500,000 units in 2000, when there were 15 models available, to over 2.2 million units last year across 41 nameplates," said U.S. sales analyst George Pipas. "By comparison, traditional SUV sales came in at about 2.4 million units in 2005, after having peaked at 3 million units a year as recently as 2002. No one will argue that CUVs will be considered the vehicle of this decade."
Lincoln’s "American Dream" target customer has an innate desire to keep improving, and wants to be rewarded as they achieve their goals. As self-made men and women, they view a Lincoln vehicle as part of their "celebration along the way."
"These are people who are on their third or fourth domestic non-luxury unit, looking to move up," said Grill. "There are 350,000 of these people a year who step up into luxury, which is huge. And when you look at that domestic move-up, 70 percent of them refuse to buy an imported luxury vehicle. We can own those folks."
Grill believes one underlying challenge to reinventing the Lincoln brand with products like the Zephyr and MKX — along with a redesigned Lincoln Navigator that will be launched this summer — is changing customer expectations. The brand carries a favorable opinion with a 75 percent customer awareness rating, but many don’t feel Lincoln products are, or were, relevant to their lifestyles.
"History can sometimes be work to your advantage — and sometimes it’s something you need to overcome as you’re trying to redefine a brand," said Grill. "In our research, when you say the word ’Lincoln’ people go, ’yes, Town Car.’ Looking at Town Car, those demographics show customers who are in their 70s and predominantly male. That compares to Zephyr buyers — in their mid-50s and about 60 percent male, 40 percent female. That’s a huge shift for us."
"I think that right now we have the best product that we’ve ever had," said Witt, the dealer in San Diego. "Now the key is to keep it coming."