Lincoln Expects to Triple China Sales
Executives optimistic but know there's more work to do
-- The Lincoln brand is off to a good start in China, with 2016 sales on pace to roughly triple sales in 2015, but Ford executives acknowledge that's only a start.
"We've got 65 stores, and they're all across China, in 25 months. That's an average of more than one opening every other week," said Kumar Galhotra, president of the Lincoln brand, at a press event here Dec. 16.
Ford Motor Co. launched Lincoln in China in late October 2014. At the time, Ford said it wanted at least 50 Chinese dealerships in 2016, so it's ahead of that target.
Galhotra said Lincoln sales in China were about 11,000 in 2015. "That may not sound like very many, but we were the first [foreign] brand to sell more than 10,000 in our first year," he said.
Through the first three quarters of 2016, Lincoln sales in China were 20,996, nearly triple a year ago, Ford said.
Rival Cadillac said its sales in China passed 100,000 through November 2016, up 54 percent from the year-ago period. General Motors launched Cadillac in China in 2004. Meanwhile, Mercedes-Benz reported sales in China of 429,325 through November, an increase of about 28 percent.
To reach "critical mass," like most other foreign brands in China, Lincoln needs to start producing vehicles in China and greatly expand its dealer network, said Steve Man, an analyst for Bloomberg Intelligence, in a Dec. 16 webinar unrelated to the Lincoln event.
"It depends going forward what their plans are in terms of localizing," Man said. "Compared to the Germans or to any luxury carmaker, they need to have close to 500 dealerships across the nation."
Lincoln launched the new Continental flagship and the MKC crossover in China in November, meeting its target of having at least five vehicles in the lineup by the end of 2016.
Sales of utility vehicles, including crossovers, are taking off in China, Man said. "The SUV and crossovers segment was up 46 percent for the first 10 months" of 2016, he said, compared with a 13 percent increase for the overall market.
As in the U.S., light-truck sales in China are taking share from car sales, Man said.
He said Lincoln's progress is "exciting," even if the sales numbers are small. "I'm actually very encouraged to see their sales go from zero to 2,000 to 4,000 per month," he said.