Ford has announced that it will be upping its production totals for the first three months of 2011 as it seeks to meet the rising demand for automobiles during the first few months of the year. However, the company is also looking to decrease its dealer network in major cities.

At the recent National Automobile Dealers Association (NADA) convention in San Francisco, Ford announced that it would be increasing production by 13 percent over the next three months, bringing the total number of shippable units up to 555,000. There was more good news for dealers, as Ford announced that more than 80 percent of its dealers were profitable again, a drastic turnaround from the depths of the recession.

However, it wasn't all good news. In order to revive its flailing Lincoln luxury brand, the automaker said that it would be looking to trim nearly 100 Lincoln dealerships in major metropolitan areas, bringing the total number down from 434 to 325. Ford claims that competing dealers in the same area are cannibalizing sales and reducing profits for each other.

"If we don't get the throughput in the major metro markets right-sized, then the transformation of Lincoln is going…to need a different plan," Ford marketing chief Jim Farley told Reuters. "This transformation is going to hinge on several things working including the (dealer) network."