Ford to Build New Lincoln Continental in Michigan--Update

By Christina Rogers 

Ford Motor Co.'s global manufacturing chief said Wednesday the new Lincoln Continental luxury car will be built in Michigan, marking a win for U.S. auto workers as contract talks with the United Auto Workers union kick into gear this week.

John Fleming, speaking at an event in Dearborn, Mich., said the new full-size model--a car that is to mark a new direction for the Lincoln brand--will be made at the company's assembly plant in Flat Rock, Mich., where it currently builds the Mustang sports car and Fusion midsize sedan. The Flat Rock plant currently employs 3,100 workers.

The new Continental flagship, a top-of-the-line sedan that revives one of the brand's most recognizable nameplates, goes on sale next year (likely as part of the 2017 model year) and is aimed at growing Lincoln's presence in China, where big, cushy sedans with roomy back seats are in high demand.

Mr. Fleming revealed the location in response to a question from the audience about where it will be built. He offered no other specifics, other than to say that the vehicle has been well received. Ford unveiled a prototype of the car's design this spring in New York. "I think it will do very, very well," Mr. Fleming said.

The Continental replaces the Lincoln MKS, which has been manufactured in Chicago.

His remarks follow Ford's announcement last week that it would move production of its Focus compact car and C-Max hybrid from Michigan, likely to a factory outside the U.S.

Labor talks between Ford and the union begin next week and securing U.S. jobs for UAW-represented workers will be a priority for the union leaders because much of the new auto investment lately has flowed to Mexico, where labor costs are cheaper. UAW officials said they were told by the company that Focus production would be moved from the U.S. in 2018.

Because small cars earn far lower margins than trucks and SUVs, companies have struggled building them profitability in the U.S. Earlier this year, Ford announced it was laying off 700 at the Michigan plant. Low gas prices and rising demand for roomier trucks and crossovers have sapped demand for small, fuel-efficient vehicles. Ford already builds U.S.-sold Fiesta subcompacts in Mexico.

Mr. Fleming said the decision to relocate the Focus and C-Max wasn't tied to contract talks but rather preparations for the next-generation models.

"It's normal business," he said. "It's just that normal business sometimes intersects with other things that are happening."

"From our perspective, we needed to move forward because our process is geared, where we have suppliers involved and we have engineering teams doing work." He declined to say where the Focus and C-Max would be built or what Ford might assemble next at the Michigan factory. He said those moves will be discussed during negotiations.

UAW President Dennis Williams, speaking to reporters Monday, declined to comment specifically on the Focus and C-Max relocation, saying he will wait until next week when the union officially kicks off labor talks with the No. 2 U.S. car maker at a ritual handshaking ceremony.

General Motors Co. Chief Executive Mary Barra said earlier this week she sees no need to follow Ford's move because she is confident the company can build its small cars in the U.S. profitability. GM builds several subcompact and compact cars in the Midwest.

Write to Christina Rogers at [e-mail]

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