Lincoln backs off 2020 sales target amid Trump trade war with China

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Falotico: "I do not think about the tariff situation and its instability [the volume goal] is something we are looking for now. "

LOS ANGELES – Lincoln Motor Co. By the end of the decade, it is no longer expected that it will achieve its target of 300,000 annual sales worldwide, largely thanks to the trade war of President Donald Trump with China.

Lincoln President Joy Falotico told Automotive News on Wednesday that the brand has supported the target that was formed under ex-CEO Mark Fields in 2014 because of the higher export costs for vehicles manufactured in the United States to China. Lincoln exports the MKZ, MKC, Nautilus, Continental and Navigator to that market with plans to start local production in 2019.

"I do not think about the tariff situation and its instability [the volume goal] is something we are looking for now, "she said in an interview on the sideline of the Los Angeles Auto Show in 2018." You will not race for volume if you have a significant change in the price comparison there. "

China increased tariffs to 40 percent on imported goods, including vehicles, in July as a retaliation for the Trump government's charges on goods built in China and sold in the US. The move has hurt Lincoln's growth ambitions in China, a country that it ultimately expects to be the largest market.

Instead of adjusting its global sales goal, Lincoln is creating a new strategy that prioritizes profitable sales rather than chasing volume.

"We want to grow profitably with healthy sales," said Falotico, who took charge of Lincoln in March. "Volume is important for scale, but we are looking for a healthy volume, we do not want to build vehicles and do not discount them."

Fields set the goal of 300,000 shortly after becoming CEO in 2014, as he jumped Lincoln's generation with a $ 5 billion investment. Sales have increased from about 100,000 that year to 188,383 in 2017, but growth in the United States has stalled this year and threatens to put an end to a series of four consecutive annual worldwide sales profits.

Falotico, who unveiled the three-pronged Aviator crossover on Wednesday, did not have the trouble to reach the threshold of 300,000 – only not with the 2020 deadline that Fields aspired to.

"We love the upside with Aviator, we're very happy with Navigator's reception capabilities and it's great to see Continental year-on-year in China," she said, "but I think with the challenges we have in the company, that [goal] can be pushed out a little. "