Joining the Club
Lincoln Mercury’s surprise decision to move its corporate offices to Irvine is an unprecedented acknowledgment by a major U.S. auto maker that Detroit is not the center of the universe.
It also underscores what industry insiders have known for years: Southern California is a major player in the automotive world.
The move by Ford Motor Co.’s luxury car unit “should certainly make it apparent” that Southern California “is the second capital of the U.S. auto industry,” said Eric Noble, an analyst with AutoPacific Group in Santa Ana.
Indeed, Los Angeles and Orange counties already are home to the U.S. headquarters of all but one of the Asian car companies that do business in North America.
Southern California originated automotive trends ranging from the big tail fins of the 1950s to the minivans and sport-utility vehicles of today. Nearly every major auto maker now has a design studio here.
“When you sit in Detroit, you just don’t get to see the mix of auto designs and uses that you see out here. And that puts you at a disadvantage,” said Ron Hill, head of the transportation design school at Art Center College of Design in Pasadena.
The state also is home to the hot rod and performance car industries and is a major source of automotive aftermarket products, such as custom “mag” wheels.
A recent study by UCLA estimated that the nine Japanese and Korean car companies headquartered here provide more than 100,000 jobs in California--most of them in the Los Angeles basin. And the California Motor Car Dealers Assn. says domestic and import auto dealerships in the state employ an additional 115,000 people.
“You have to be here if you are in automobiles,” said Chris Cedergren, managing director of Nextrend, a Thousand Oaks automotive consultant.
Today’s Lincoln Mercury executives certainly think so.
“I’m not knocking anybody, but there are new people running the company now,” said James Rogers, Lincoln Mercury’s second-in-command. He said the company “is very open to new ideas, and things are going to happen when you have that attitude.”
Rogers said making the decision to move took less than a month. “I was sitting at my desk in Detroit yesterday afternoon when my boss came in and told me to hop on a plane to Califoria so we could announce it.”
Southern California was picked for Lincoln Mercury’s new home “because its trend-setting culture will help nurture the continued development of unique cars and trucks,” said Jim O’Connor, general manager of the division and a Ford vice president.
Lincoln Mercury is negotiating with Irvine-based Mazda North American Operations for an 11-acre parcel adjoining Mazda’s U.S. headquarters in the sprawling Irvine Spectrum business park.
Rogers said the company plans to build a headquarters facility there and likely will lease temporary quarters elsewhere in the Irvine area until the new office is done.
“This all happened so fast that we don’t have a plan yet for exactly what we’re going to do to make the move,” he said. “But the intention is to be up and running [in California] by the end of the year, and if we can do it sooner, we will.”
Lincoln Mercury will join six other car makers with regional or national offices in the Irvine Co.-owned Spectrum.
“We started with Mazda, and now Kia is here. Toyota and Chrysler have major operations in the Spectrum, and Volvo and Lexus have offices. We’re becoming an automotive powerhouse,” said Dick Sim, president of the giant land-developer’s investment properties group. “It attracts other automotive companies, and it attracts design professionals.”
The region’s design industry was the major draw for Lincoln Mercury, executives say.
O’Connor referred to Southern California as “a hotbed of creativity and innovation” when he told Lincoln Mercury employees and dealers of the move Thursday morning.
Ford already has a West Coast design center in Valencia, but Lincoln Mercury intends to establish its own studio in or near its new Irvine headquarters, Rogers said.
There is a deep pool of design talent in the area, with 19 automotive design studios. The Art Center College of Design in Pasadena is considered one of the world’s major transportation design schools.
“The lifestyle here just lends itself to auto design,” Hill said of the Art Center.
“The weather makes it possible. Cars are not just a commodity, like they are in the East and Midwest. It is vital for car companies to be here and to understand how this very competitive and important market works,” he said.
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Driving by the Numbers
Southern California is a major player in the automotive industry. A glance at the local industry:
Number of Asian car companies that do business in North America that don’t have headquarters in Southern California. (Subaru doesn’t have a headquarters here.): 1
Number of automobile design firms in Los Angeles and Orange counties.: 19
Number of new car dealerships in Southern California as of July 1996 (the most recent data available).: 1,054
Number of Lincoln Mercury vehicles sold in California in November.: 2,568
Number of Toyota cars and trucks sold in California in November.: 13,757
Estimated number of California jobs provided by Japanese and Korean car companies.: 100,000
Number of people employed by auto dealerships in California.: 115,000
Number of vehicles registered in California in 1996.: 26,580,799
Sources: Los Angeles County Economic Development Corp., J.D. Power & Associates, Department of Motor Vehicles, Times research
