Lincoln dealers have until early January to make a life-or-death decision: Invest to meet service and dealership standards or lose the franchise.
Lincoln plans to drop 200 or so of its almost 1,200 franchises, mostly in 130 metro markets, in an effort to rehabilitate the sagging luxury brand.
"Dealers will decide," said Mark Fields, Ford Motor Co.'s president of the Americas. But the reality is that any dealer who does not agree to upgrades negotiated with Lincoln field staffers will get whatever severance compensation Lincoln offers.
Fewer than 25 percent of all Lincoln dealerships currently meet the automaker's standards, the company says.
It's all part of a Ford initiative to make Lincoln more competitive with other luxury brands by improving products, customer experience and financing.
On key measures of brand success -- U.S. sales, sales per dealership, loyalty rates and residual value -- Lincoln ranks at or near the bottom of nine luxury brands.
While mass-market Ford division has rebounded this year to become the top-selling brand in the United States, Lincoln has slumped.
In 1998, Lincoln was the top U.S. luxury brand with 187,121 sales. Last year Lincoln's 82,847 sales were less than half those of market leaders Lexus, BMW and Mercedes-Benz.
"Dealers know it's screwed up," said Bob Tasca Jr., a Rhode Island dealer and head of Lincoln's dealer council. "We are looking for a chance to change. It has to change, because the way it is isn't working."
Ford plans to reverse Lincoln's slide with changes in product, dealerships and lending.
"We are committed to Lincoln," Fields said at a media briefing following a meeting with 900 dealership personnel last week in Dearborn, Mich. Among the highlights:
-- Lincoln will introduce "seven new or remodeled vehicles in the next four years," Fields said. Lincoln now sells three cars and three light trucks.
-- "Ford Motor Credit Corp. will be available to help Lincoln dealers invest" and Ford's captive lender also is creating an internal unit to cater to Lincoln customers seeking loans, said Ken Czubay, Ford's vice president for U.S. marketing sales and service.
-- Lincoln wants dealers to improve the "customer experience," said Ford global sales boss Jim Farley. He outlined upgraded "customer touchpoints" in dealerships, including higher standards for loaner vehicles and car washes.
Adding urgency to many dealers' decisions is the wind-down by year end of Mercury. For decades Mercury had provided half or more of the volume of dualed Lincoln-Mercury stores.
The severance package for dealers who decide against the upgrades was not announced at the press event last week.