FORTUNE — Ford Motor Company executives know how long it will take — and the billions it will cost — to turn Lincoln into a competitive luxury brand.
And they know that offering three “Black Label” ultra-luxury versions of today’s Lincoln models with premium materials is a Band-Aid, a first small step on a very long road.
But Ford (F) is counting on Black Label to buy it some time and to improve dealer profits until the automaker is prepared to commit to a thorough revamping with new models and brand building. The initiative was announced last week at the Concourse d’Elegance in Pebble Beach, Calif.
The only Detroit automaker that escaped the last recession without declaring bankruptcy, Ford said it intends to increase its capital spending through mid-decade — which could mean an accelerated makeover for Lincoln, including new models and expansion into overseas markets.
“Ford is way behind its competition in transforming Lincoln, so it is trying to do what it can to enhance profits and boost sales as it revamps the entire line, which is going to take several years,” said Michelle Krebs, an analyst for Edmunds.com in an email. “The jury is very much out on whether Ford will be successful at this Lincoln transformation.”
General Motors’ (GM) Cadillac luxury division, which was surpassed by Lexus (GM) and German automakers Audi, BMW, and Mercedes-Benz, began a decade ago to offer new models like the CTS. Cadillac, with several new models since, is on the upswing, its sales this year reaching nearly 70,000, up 39% from the previous year.
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Lincoln’s revitalization is in its infancy, and it has so far sold only 30,819 vehicles in 2013, down more than 10% from the same period last year. For now, Black Label denotes three fancier design themes for the vehicle’s interior: Modern Heritage, Indulgence, and Center Stage, featuring special colors and materials.
Ford said Black Label customers will also receive dedicated, personalized service when shopping for Lincoln vehicles and scheduling service; the price hasn’t been disclosed. Ralph Lauren (RL) and American Express (AXP) are among the U.S. companies that have used a “black label” theme to create a higher-level brand within a brand.
Ford was fortunate in 2006 when it decided to mortgage itself to raise the capital it needed to build new models. When credit markets froze two years later, GM and Chrysler were caught short of cash and unable to borrow. Both companies filed for Chapter 11 reorganization under the direction of the U.S. Treasury.
A weakened Ford struggled, too, only recently regaining investment-grade rating for its securities. Now, the company can raise capital at competitive interest rates.
Ford CFO Bob Shanks announced a week ago that he is “comfortable with the present liquidity,” with more than $25 billion in cash at the end of the second quarter. Ford aims to maintain investment-grade status through a down cycle in the industry.
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Fixing a luxury car brand or building one from scratch is notoriously costly, measured in multiple billions of dollars. Jim Farley, Ford’s chief marketing officer, has said the process could take 25 years.
But any automaker that fails to maintain or operate a luxury brand will sentence itself to a permanent financial disadvantage. Luxury vehicles generate disproportionate profits, which can be used to expand markets or support the development of new vehicles and technologies.
The brain trust at Ford doesn’t have to look far to see how much GM has accomplished in its move to fix Cadillac. And with its bank accounts on the mend, the automaker soon could be taking its own series of bold actions to bring Lincoln back.
