Ford and General Motors introduce two new luxury cars this week at the New York International Auto Show that could play key roles in ending a persistent problem: While mass-market models such as the Chevrolet Cruze and Ford Focus are popular around the world, the U.S. auto industry has failed to build a world-class luxury car that lures wealthy drivers away from the likes of Mercedes-Benz, BMW and Lexus.
Both cars, Ford’s Lincoln Continental Concept, a near-ready revival of the once-regal automotive brand, and General Motors’ Cadillac CT6, an amped-up sports sedan carrying a newly engineered 400-horsepower V-6 engine, will share floor space at the 10-day event, which opens Friday at New York City’s Javits Center.
The cars will be available sometime next year, and both are vehicles that Ford and GM would like to see embraced outside of the United States. The challenge is that Cadillac and Lincoln have little brand recognition overseas, and the automakers lack the global infrastructure to overcome the hurdles of introducing new wealthy buyers to brands with less global recognition.
Both automakers are hoping China’s rapidly growing appetite for luxury wheels will change that.
“Unlike Audi, BMW and Mercedes-Benz, Cadillac and Lincoln just aren’t globally recognized,” Michelle Krebs, senior automotive analyst for AutoTrader.com, says. “This globalization is starting to happen a little in China, however. Lincoln just arrived there last year, and it’s doing very well so far. That’s why the Continental is so important; it’s the first truly global vehicle for Lincoln.”
Ford is expanding its Lincoln retail presence in China from six dealerships last year to as many as 25 by the end of 2015, Lincoln President Kumar Galhotra told analysts and investors on a conference call in December.
Ford has studied the Chinese market closely, even consulting with luxury fashion labels Prada and Burberry on the buying habits and preferences of wealthy Chinese consumers, according to the L.A. Times. The company is designing new Lincoln vehicles with an eye toward pleasing buyers in the world’s biggest auto market. New features include generous rear-seat legroom and an option for high-end or culturally specific trim options, similar to Rolls-Royce’s panda and bamboo theme.
At the same time, GM is trying to make Cadillac a serious contender in China.
The company has exported Cadillacs to the country for years. And while sales volume is small, at just 73,500 in 2014, strong Chinese demand for the XTS sedan and the SRX midsize crossover SUV has Cadillac sales growth soaring. In 2013, GM began manufacturing the XTS sedan through its joint venture with SAIC, China’s largest automaker. And later this year, GM is scheduled to open a $1.3 billion factory outside of Shanghai that is dedicated solely to making Cadillacs. The company has said it plans to introduce nine Cadillac models in the country by 2020.
For the U.S. luxury car brands, China is not just the world’s fastest-growing luxury car market; it’s also the platform on which Lincoln and Cadillac might someday compete with German and Japanese high-end brands in Asia.
“The CT6 is important to Cadillac’s image globally, but it will be most important to Cadillac’s volume aspirations in China,” Stephanie Brinley, senior analysts for IHS Automotive, said in a research note. “For Cadillac and Lincoln, the introductions in New York of their respective range-topping sedans will mark another chapter in the rebuilding of each. In terms of brand impact, these are the two most significant introductions at the show."