DETROIT -- In an attempt to inject more luxury into its last remaining premium brand, Ford Motor Co. wants to cut at least 200 Lincoln franchises, or 40 percent of its dealers in major metropolitan areas.
Ford will require substantial dealership upgrades intended to raise Lincoln's game in terms of customer experience to the level of such luxury brands as Cadillac, Lexus, Mercedes-Benz and BMW. This push is being driven by luxury consumers who say that Lincoln doesn't match its competitors.
Multiple sources said Ford is expected to outline the plan at a two-day Lincoln dealer meeting that begins Monday, Oct. 4, in Dearborn, Mich.
Small, rural, markets are less of a target, sources said.
The death of Mercury -- which accounted for most of the volume for Lincoln-Mercury dealers -- is prompting Ford to move faster to pair Lincoln with Ford-brand dealers. Still, in some large metro markets, there will still be stand-alone Lincoln stores, Ford executives have said.
After shedding Aston Martin, Land Rover, Jaguar and Volvo over the past three years or so, Ford wants to create a premium showroom experience for its final premium brand.
Lincoln has its work cut out for it. Twelve years ago, it was the top-selling luxury brand in the United States with sales of 187,121 units. Last year, Lincoln sold 82,847 units, ranking seventh among luxury brands and far behind leader Lexus' 215,975 sales.
Ford believes it can increase per-store traffic by having fewer locations in major metropolitan areas. The average number of sales per Lincoln store last year was 67 compared with Lexus' 947. As of Jan. 1, Lexus had 230 U.S. stores, and Lincoln had 1,221, down from 1,596 in 2000. Also as of Jan. 1, Audi had 270 stores; BMW had 338 stores, and Mercedes had 352.
Ford has 495 Lincoln stores in metro areas. It wants to have about 300 metro area dealerships by reducing a mix of stand-alone and dualed stores based on the competitive nature of each market, sources said.
Investment in Lincoln stores is also a priority. That strategy will include higher facilities standards and improved customer service. Those higher standards might prompt some dealers to cash out, sources said.
In some cases Ford will offer buy-out packages to dealers.