Ford to Move Luxury-Car Unit to Irvine
Ending months of speculation, Ford Motor Co. said Thursday that it will move the U.S. headquarters of its foreign and domestic luxury lines to Irvine, cementing Southern California’s reputation as a key automotive industry center.
The long-expected relocation from New Jersey of Aston Martin, Jaguar and Volvo--to join Lincoln in Ford’s Premier Automotive Group--is just the latest of what industry analysts see as a continuing migration of automotive-related companies to the region.
While no one is betting on wholesale moves by other major auto makers, a plethora of advertising agencies, design studios and other businesses that support the car industry are sure to follow.
“California is the place where trends are set, and you’ve got to be there,” said Brad Fox, an analyst at AutoPacific Inc. The Tustin-based consulting firm is among dozens of car-related companies based in Southern California.
“Car people who don’t already know that Southern California is important in the global auto industry are either unwise or foolish,” Fox said.
General Motors Corp. underscored that with its recent decision to reestablish in North Hollywood the Southern California advanced design center that it closed for budgetary reasons just four years ago.
It is one of about 20 automotive design studios in the region, all of them fed by the Art Center College of Design in Pasadena, home of one of the three top-rated automotive design schools in the world.
There are no auto manufacturing plants in Southern California. But hundreds of companies make automotive performance and appearance parts, handle design work, perform marketing studies, build custom vehicles, restore classics and sell, repair and maintain the more than 20 million passenger cars and light trucks that fill Southern California highways daily.
About 53,000 people are employed in Southern California’s automobile industry, said Jack Kyser, chief economist for the Los Angeles Economic Development Corp.
Ford will bring about 225 administrative, planning, sales and design employees to Irvine to join nearly 200 Lincoln Mercury workers.
Though the Japanese car companies began locating their U.S. headquarters in the area in the late 1960s, the growing presence of the auto industry was little noticed until Ford shook things up in 1998 by moving the global headquarters of its Lincoln Mercury unit to Irvine--the first time since World War II that a domestic car maker had been located outside of Michigan.
Since then, Lincoln and Mercury sales have begun climbing and company officials have boasted long and loud about how the area’s cultural and ethnic diversity has helped them see things in a fresh new light.
Because of Lincoln Mercury’s experience, Kyser said, “I think you’ll start to see some of the other divisions say it’s time to go West and revitalize our health.”
Indeed, officials in Irvine, now home to seven auto companies, a major motorcycle firm and half a dozen automotive design studios, have been selling the city for more than a year as “Motown West” in business recruiting drives around the country.
Lincoln Mercury was quickly followed to Irvine by its advertising agency, Young & Rubicam, which set up shop with 60 employees and now has 250, and by Exhibit Works, a Detroit firm that builds elaborate auto show displays.
Officials at Ford confirmed Thursday that the agencies that handle U.S. advertising for Jaguar and Volvo also will relocate large staffs to Southern California to keep in close contact with their clients. The two car companies together spend about $150 million a year on U.S. advertising, industry sources said.
Wolfgang Reitzle, London-based president of Ford’s Premier Automotive Group, said the company’s new North American headquarters will include an advanced design center dedicated to the four brands. Ford will also retain its Lincoln Mercury Concept Center design studio in Valencia.
“The benefits of this move from a designer’s point of view are that you can avoid overlapping brand identity” by putting the decision makers together so they can communicate easily and frequently, said J Mays, Ford’s vice president of design.
Car makers in the 1990s have learned that many customers see autos as status symbols and fashion accessories.
“People here put a certain emphasis on their cars, there’s a special car culture, and we want to be here to take advantage of that,” Reitzle, a former top executive at Germany’s BMW, said about the Southland.
Both Reitzle and Mays suggested that a first fruit of the relocation to Southern California could be a new type of Volvo that combines attributes of sport utility vehicles and sedans.
Ford will keep the global headquarters of its premier group in London, and Victor Doolan, former BMW of North America president, will oversee the North American operation from Irvine.
To house the Premier Automotive Group, its advanced design center and the corporate offices of Lincoln Mercury, Ford is building a 300,000-square-foot, five-story building in Irvine on land adjacent to the existing headquarters of Mazda North American Operations. Ford owns controlling interest in Japan’s Mazda Motor Co.
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Times staff writer Daryl Strickland contributed to this report.
