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Saving Lincoln

Despite calls to mothball it, Ford hopes to revive Lincoln as a legit luxury brand. Can a new rear-drive concept do the trick?

Saving Lincoln

Despite calls to mothball it, Ford hopes to revive Lincoln as a legit luxury brand. Can a new rear-drive concept do the trick?

At next month's North American International Auto Show, BusinessWeek.com has learned that Ford Motor (F) will show a rear-drive Lincoln concept car. It will be based on the same rear-drive chassis and engineering architecture it is planning for a future design of Ford Australia's popular Falcon model.

Ford has made it clear that it wants to try to revive Lincoln. At the center of debate about the struggling brand's future is whether to bring out a rear-drive design, which luxury car buyers tend to love, or concentrate instead on front-drive and all-wheel-drive vehicles. So far, the front-drive crowd has been winning the arguments at Ford.

Rear-Drive Designs

Front-wheel-drivers are usually lighter, and therefore less expensive to manufacture and operate. Typically, rear-wheel-drive cars, such as the BMW 3 series and the Porsche 911, appeal to driving enthusiasts because they offer better handling and acceleration. (see BusinessWeek.com, 10/30/06, "Which Drive Is Right for You?"). A successful rear-wheel-drive luxury car could be the savior that Lincoln and its supporters desperately need.

The rear-drive concept, whose design was led by Ford North American design chief Peter Horbury, will include several design cues he wants to incorporate into a future flagship Lincoln, whether he wins the rear-drive battle or not. But the automaker is looking for enough positive responses from the public and the media to make a case for the rear-drive design.

"If Ford is serious about saving and reviving Lincoln, then rear-drive design is essential," says John Wolkonowicz, an automotive analyst with Global Insight. He says that Ford had recently discussed building a rear-drive Lincoln off the engineering architecture of the Ford Mustang. But that idea was thwarted because the Mustang has a solid rear axle, and the ride of a luxury car should have an independent rear suspension.

Too Much Mismanagement

If Ford builds the rear-drive concept, it wouldn't likely surface in showrooms until 2009 at the earliest. In the meantime, the Lincoln division is beefing up its heretofore paltry lineup with the new MKX crossover, hitting dealerships this month; a front-drive MKS sedan, which shares underpinnings with the much derided Ford Five Hundred/Mercury Montego sedans, due to launch in 2008; and a luxury "people mover" based on the Ford Fairlane concept. The company has just renamed last year's Lincoln Zephyr the MKZ, and given the small sedan a 3.5-liter engine and an all-wheel-drive option. And then there's the venerable Town Car, whose retail business has dwindled, but which remains the juggernaut of the airport livery car business.

When Ford Chairman William Ford Jr. was deliberating over his future as chief executive of the company his great-great-grandfather founded, and what the automaker should look like in 10 years, he made a list of the company's brands. Next to each brand, he wrote notes about which of them could fit in with his goals.

Lincoln has not been one of the brands in the "plus" column. That's because the brand has been so desperately mismanaged over the past two decades, and many analysts have called for the company to pull the plug. Few retail customers, outside those graying die-hards who have never bought anything else, understand what Lincoln is supposed to represent in a luxury category dominated by Toyota's (TM) Lexus, DaimlerChrysler's (DCX) Mercedes, BMW, Audi, Honda's (HMC) Acura and Nissan's (NSANY) Infiniti.

Company Dithering

Even its nemesis, General Motors' ( 2 Next Page