In the first part of this post, we saw that the traditional American four-door sedan had to fend off the assault of both hatchbacks and SUVs, even and maybe especially on the luxury front. Today, we wonder, is fielding a luxury crossover or SUV, based or not on a standard line model, the key to profitability? When you think about it, several patterns stick out.
European brands (which in North America basically amounts to German brands) come from a market where the SUV craze is really just reaching full speed and where the divide between hatchbacks and four-door sedans is still very strong in terms of image. The hatchback BMW 3-series and C-class coupes were commercial and critical failures because they were conceived as decontented versions of their traditional sedan counterparts. On the other hand, Renault’s try to field a luxury full-size hatchback went from a decent sales success with the Safrane to outright fiasco with the Vel Satis.
All that to say that in North America, German brands have, because of that traditional positioning, heralded the sedan stronger and for longer than their competitors. Which helped cement in this market the image of the modern four-door car as a sports sedan. That is why their sedan line-up is strong and a success of its own, and it not threatened by the addition of SUVs to their offering. To the point that German manufacturers now offer an expansive catalog of vehicles : xx for Mercedes, xx for BMW, xx for Audi. This strategy has since been adopted by new Japanese luxury makes, which were created from scratch and are consequently free from tradition. To them, a sedan is a German-like sports sedan no matter the size segment, and they all chase the same prospects – you might say they sell a certain kind of car for a certain kind of buyer. This is especially true in the design and execution of the latest Lexus GS, but can also be felt in the marketing pitch behind the new Acura TLX and Infiniti Q50 (whose Eau Rouge concept was a Nurburgring special).
For our domestic manufacturers, decades of market shifts have left a mark and it is important to follow current trends to reach a wider audience and achieve volume. As such, since the sedan was everything from price-leading economy to luxurious comfort, it has had more opportunities to stumble with every change in consumer tastes. Models are added or retired depending on whether they sell or not, and a brand’s very image ends up being defined by its product plan rather than the other way around. And when a model stays true to tradition for a long period of time, it is to offer an “old fashioned” product and sell a car to conservative buyers who have not (yet) been seduced by new products coming from overseas. If you look at Ford’s standard line, the Fusion is the last remaining successful four-door, because it represents as we saw a good compromise of roominess, efficiency and affordability for the traditional family. At the lower-end of the spectrum, the economy offering of choice is now a Fiesta or Focus hatchback. At the top, people looking for comfort and/or roominess will choose an Edge, Flex or Explorer. And, all around the line-up, even the smallest car can be equipped with the Corporation’s latest technology. Same is true at Chevrolet, and it is interesting to see the wide array of models that have worn the Malibu or Impala name in the last twenty years.
So what’s a domestic luxury manufacturer to do? Should it become a specialty manufacturer, or still go after volume? These orientations are decided on the long-term, but it is interesting to compare Cadillac and Lincoln, and maybe try and see what’s in store for the future.
Cadillac started off with an advantage when the market shifted in the 1990s and 2000s. It was the biggest seller, so it had achieved a healthy volume already. It had also a longer tradition of catering to import buyers : the Seville is a success for the ages, and regardless of blunders like the Cimarron (which was actually pitched against German cars), it had since the late 1980s developed the « Touring Sedan » mark on the Seville and DeVille. So, when Cadillac reached the fork in the road, it chose to field the CTS and “Arts and Science” in order to follow German brands.
It took a long time, but its line-up is now aligned on the imports : the ATS, CTS, XTS and incoming CT6 cover all sizes and powertrain combinations and are constantly upgraded to keep up with the competition. The SRX and Escalade are money-makers but increasingly act as accessories to the rest of the brand’s image. In the short-term, Cadillac should adopt a position even closer to its import competitors : its new naming convention will put the emphasis on the sedans, and the return of V-series models will give a run for their money to the likes of AMG or M.
Lincoln’s situation was different. First of all, it was a lower seller than Cadillac and consequently had to be more attentive to market shifts in order to achieve volume and sustainability. Then it was teamed with Mercury, which could offer lower-priced model and set the stage for loyal customers to eventually upgrade to a Lincoln, while generating traffic – but Mercury dwindled for years and is now gone. Finally, it knew a much closer relationship to its parent company, Ford, which is one and the same with the corporation’s standard line and from which it had to draw on engineering and design.
It’s consequently no surprise that the segment-shattering Navigator and Aviator originated from Lincoln, and no surprise that it has since put less emphasis on its sedans and more on its SUVs and CUVs : the outgoing MKX has been a constant strong seller, and the brand now relies on two sedans (the new MKZ and the MKS which was first revealed in concept form almost ten years ago) and a healthy group of urban off-roaders. The MKC is brand new and critically acclaimed, the MKX is being renewed with the same amount of care, the Navigator has just been facelifted for 2015 (a new model is already on track for 2017), and finally another full-size crossover has been covertly announced. Will it take the form of an elevated, rugged vehicle?
Probably, given that the otherwise excellent MKT failed to gather the attention it deserved, mostly because of a packaging that blended traditional sedan and old-fashioned station wagon. The fact that most of the company’s announcements have concerned SUVs or CUVs rather than sedans (both the mid-cycle refresh of the MKZ and introduction of the next-generation MKS are still wrapped in mystery) tells that Lincoln is clearly not yet following in the steps of Cadillac and instead working to achieve the volume and critical mass to expand its line-up. Indeed, in terms of return on investment, crossovers and “sport utes” are a very good way to get your product out there and get on prospects’ shopping lists.
Still, will Lincoln eventually be joining the renewed sedan extravanganza going on in the luxury market? Probably. It is clear that the German brands’ core product and the cornerstone of their reputation is a solid sports sedan. People who are buying Mercedes-Benz’s CLA today are ready to make a great deal of compromises because of the reputation of the C-class. People who will be buying BMW’s Active Tourer FWD compact will do so because of the reputation of the 3-series, even if the two vehicles are as far apart as can be.
The clearest indication of Lincoln’s next move will be the choices it makes with the next MKS full-size sedan : if the brand refines the already competent packaging of the current generation, it will mean that they for now choose to apply the recipe behind the 2012 MKZ but with maybe a grander scale. That recipe would then be to make the best entry-level luxury product in its size/power/price class, building on Ford’s know-how while adding unique features. Much like the Japanese imports did throughout the last decade as they built luxury brands on top of conventional sedans. That will then leave the SUV part of Lincoln’s line-up to be the true area of innovation for yet another product cycle.
On the contrary, if they decide to break away from the current MKS and go all out, it will position them directly with one foot in the high-end luxury market and upfront against the latest Acuras, Infinitis and Lexus. Lincoln’s strong SUV line-up will then keep bringing support in momentum, traffic and attention to the brand while allowing them to push on the sedan front.
In short, there is definitely space for four-door sedans. While they falter in the mainstream market (especially among non-luxury manufacturers in Europe) and are pitted against new trends and segments, they appear more than ever to be unavoidable in the luxury markets. As evidenced by Cadillac’s rapid development, which is directly based on a strong sedan line-up, there is even more room at the top than one would expect. The key is just that a comfortable, well-rounded package will not cut it anymore : to assert its presence on the luxury market, Lincoln will need to develop a strong dynamic sedan, especially when it comes to full-size vehicles. Otherwise, they will find themselves positioned closer to mainstream brands, including Ford.
Still, it does not have to be an immediate move : the 2014 CTS is nowhere near where the 2002 CTS was. Also, Lincoln has today an advantage that Cadillac did not have back then : its successful SUV line-up (provided the release of the new MKX and 2017 Navigator go at least half as well as that of the MKC) will provide exposure, sales, resources and experience which will come in handy when the brand decides to make the jump and go head-to-head with the competition.
Auto-show circuit addendum:
In the past few weeks, a number of interesting developments marked the sedan world. First, the CT6 made an appearance at the Oscars with some heavy artillery in terms of advertising space throughout the night, confirming that General Motors was very much set on removing German brands from their pedestal.
But before that, Buick surprised everyone with the Avenir concept: a full-size, unabashed luxury four-door sedan based on the same platform as the CT6, and previewing, if not a stablemate for Buick, at least the design of its next-generation sedans. Beyond the synergy that ties Buick with Opel, General Motors’ German arm, there is no doubt that the Avenir goes after imported competition rather than after the ghost of the last Roadmaster to ever roam American roads.
Finally, on a side note, this week’s Geneva Auto Show saw the release of ItalDesign’s Giugiaro GEA four-door luxury cruiser, an autonomous one at that. I wanted to share news of that release because while it is very much “vapourware” at this point, it still is a stunning reinterpretation of the essence of the luxury sedan as we know it and as many would like to find it in an ideal Lincoln showroom. With its beautiful paint colour, stylized lighting and suicide doors (not to mention its interior refinement), it shows that there is room for sophistication, technology and daring styling in that segment.
See also :
- Of Sedans and Cross-overs, Part 1, at TheMarkOnline
- Full-size Sedan Freefall, at TheTruthAboutCars.com
- Cadillac CT6 Flagship to Bow at NY Auto Show, at Autoblog.com
- ItalDesign Giugiaro GEA Rolls Out the (Virtual) Red Carpet, at CarAndDriver.com