Just over a year ago, Lincoln announced ambitious plans to launch seven new models in the U.S. market by 2014. Rumored to be included in that tally was a compact luxury car, meant to compete against the likes of the Audi A3 and the Lexus CT 200h luxury hybrid.

While rumors of a compact Lincoln date back to 2008 (and the Lincoln C Concept of 2009), there was enough specific information leaked about the car to make it seem believable. The car was to be called the Lincoln MKC, and it was to be built on the new Ford Focus platform, with an emphasis on technology to set it apart from luxury rivals.

Now comes word from Ford Inside News that the MKC project has been killed off, since Lincoln is concerned that a compact offering would negatively impact sales of the midsize Lincoln MKZ.

As if that news isn’t bad enough, it looks like the 2013 Lincoln MKZ won’t hit showrooms before late 2012, or several months after the debut of its sibling, the 2013 Ford Fusion.

Lincoln is still planning a compact crossover, dubbed the “MKD,” and it will allegedly be built on the new Ford Escape platform. It will be smaller than the Escape, and a source close to the project refers to it as more of a “tall hatchback” than a conventional crossover.