Ford announced today that its luxury brand, Lincoln, will launch in China by late 2014. The brand hopes to cash in on growing luxury-car sales in China that are expected to reach 2.7 million units annually by 2020.
Lincoln says its research shows that more Chinese consumers are ready to buy luxury goods, although they generally do so for a sense of personal satisfaction rather than to show off to friends and family. Moreover, these buyers like to have a sense of heritage behind luxury brands, and want to personalize products.
"In China, the emerging luxury buyers are younger and fast-changing, and they have a strong desire to understand and appreciate the heritage of a brand," Ford global vice president of marketing Jim Farley said in a statement. "Lincoln will distinguish itself by providing more individual and personalized [cars], and a more personal and crafted experience to match."
Parent company Ford already has established a strong beachhead in China, and plans to expand its offerings to 15 vehicles and 20 different powertrains by 2015. The company is building five factories in China, including one in Chongqing that will be Ford's largest manufacturing facility outside Michigan. Overall, Ford expects to have an annual Chinese production capacity of 1.2 million units by 2014. Ford hopes that China will help bolster annual sales by 50 percent compared to 2010 levels, to about eight million cars by 2015.
Later this year, Lincoln will start meeting with dealers to establish an independent dealership network in China. The company expects its vehicles to become available in the Asian country by the second half of 2014. So far, Lincoln hasn't said which products it will see in China. It's a fair bet that only new vehicles, like the 2013 MKZ sedan (pictured), will be exported to China. The company is expected to launch a range of new cars – including an updated MKX crossover, MKS sedan, and a Ford Escape-based compact crossover – over the next few years.
The move to send an American luxury brand to China isn't totally without precedent. General Motors brought its Buick division to China several years ago, and quickly found that the ailing brand was more popular in Asia than on American turf. In 2009, Buick sold more than four times as many cars in China as in the U.S. That pattern continues today: in July 2012, Buick sold 52,691 cars in China, compared to just 14,391 cars in the U.S. during the same month.