Detroit’s first new car factory produces three-wheel drive Grand Cherokee (STLA)

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NOTE: A version of this article was first published on January 2, 2022 or approximately on my Seeking Alpha Marketplace website.

There are not many new fully integrated car factories built-in United States every year. Most years no one is built.

In 2021, it looks like at least three new car factories were completed and production began before the calendar year 2021 was over:

  • The Stellantis (NYSE: STLA) plant in Detroit, Michigan, which began manufacturing the Jeep Grand Cherokee L in March 2021, and the regular wheelbase (non-L) at the end of the third quarter.

  • The Toyota-Mazda joint venture plant in Alabama, which started production of the Toyota (TM) Corolla Cross in the third quarter of 2021.

  • The Lucid (LCID) plant in Arizona, which started production of Air since the second half of 2021.

One would have been fourth, Tesla (TSLA) in Austin, TX, was originally scheduled to be completed in July 2021, but after several delays, it seems to have just missed the 2021 deadline, as it may start production in early 2022 instead: Report : Tesla Giga Austin starts production next week

It is thought that it will start producing Model Y, and then the Cyber ​​truck maybe already this year or 2023.

For those who can ask: What about Rivian? (RIVN) The Rivian factory was already a car factory, so even though it was renovated to accommodate the production of a completely new set of vehicles, it does not count for the purpose of this list.

The first new car factory in Detroit in three decades

This article is about the new Stellantis (STLA) car factory in Detroit, which started operations in March 2021, but has its roots all the way back to 1916, where various car components were manufactured over the decades. The number of twists in terms of what was manufactured in this factory during this century, starting in 1916, is too numerous and too complex to be bothered to be bothered to print right here, but for a more detailed story I recommend this article : Jeep’s Mack Avenue Assembly Plant Gets New Life – Detroit Bureau

Suffice it to say that in recent decades, this factory had produced V6 and V8 engines that go into a variety of Stellantis brands such as RAM, Jeep, Dodge and Chrysler. These final assembly plant factories were in turn mostly located in and around Detroit and Michigan. Geographically, this new final assembly plant is essentially adjacent to the factory that makes the Jeep Grand Cherokee and Dodge Durango: Jefferson North Assembly – Wikipedia

Long in the making: Three-row Jeep for the American market

Jeep had been toying with the idea of ​​a three-row version of the Grand Cherokee since the mid-1990s, but the concept design never left the drawing board. Either there was not enough money to finance the project, or the market for a three-way off-road SUV in this size class was not considered large enough for profitability – clearly something that was undoubtedly disproved, in the last decade or more.

After 2011, however, the Group’s finances began to improve rapidly and the market for three-row SUVs in this size class grew very large. After refining the design in the studio, Jeep began developing this vehicle – a completely new generation of Grand Cherokee, including a three-wheel drive version, around 2015. It is this new vehicle that began production at this new factory in Detroit in March 2021.

In terms of platform, chassis and overall (electric) architecture, the “old” Jeep Grand Cherokee that was manufactured until 2021 was unusually old in the tooth. Its foundations have been raked back much longer in time than most new cars.

Brand new from scratch: Jeep Grand Cherokee

This three-wheel-drive Jeep Grand Cherokee – the first three-wheel drive ever – marks a major break with the outgoing Grand Cherokee except for one thing: the powertrain. The combinations of engine and gearbox are mainly transferred, although a new plug-in hybrid version will be added during the first half of 2022.

Everything else is new, however: Chassis, suspension, interior, exterior, electronics – everything. The so-called “driving dynamics” are a big step up compared to the outgoing Grand Cherokee – steering, handling, suspension, etc., are all much better than the old generation Grand Cherokee. One would not think that these two generations of vehicles are related – and that is because apart from the engine gearbox, they are not.

The first thing you will notice with the all-new Jeep Grand Cherokee are two things about its design:

  1. This long-wheelbase version is really much longer than any previous Grand Cherokee. Optically, it looks almost like a bus in comparison: It’s just long – but not in a bad way.

  2. Long or not, it looks good! Although it has the iconic seven-door grille in common with all other Jeeps, it certainly does not resemble the outgoing Grand Cherokee at all. It’s hard to describe a design in words, but it looks more sophisticated and exclusive than any Jeep that preceded it (apart from the completely different Wrangler and Gladiator models, as they circulate in a completely different design trajectory).

One of the areas where Jeep has shone in recent years is in terms of interior ergonomics, especially the cockpit controls. Jeeps are simply easy to use, compared to many other brands. Of course, Jeep is not the only brand that excels in this area – I would argue that Hyundai and Kia also nail this category.

As a result, there is very little to talk about in terms of the all-new Jeep Grand Cherokee L (L stands for “Long” as in the “Long Wheelbase”) other than design. Why? To get into the vehicle, adjust the controls and get ready to drive it for the first time is done with a smaller learning curve than almost everything else on the road today: basically just go in and go – with better than average ease.

A new level of riding / driving comfort

The outgoing Jeep Grand Cherokee was an acceptable compromise between off-road chops and decent road conditions. Still, it was clear that, unlike other SUVs that have entered the market in the last half decade, it did not have the same level of steering, handling and ride comfort. It was not terrible by any means – and definitely up to the standard a decade ago – but 2021 is not 2011.

In this new Jeep Grand Cherokee L, I could not detect any such compromise. The Grand Cherokee retains its off-road chops, but when driven on paved roads, it is as sharp and agile as virtually any crossover SUV on the market today.

Economic impact for the Stellantis group

Until 2021, the Stellantis Group had not sold any 3-row SUV in the US market other than the Dodge Durango. If you wanted another 3-row product from the group, you had to buy the Chrysler Pacifica, which thankfully and finally became available with four-wheel drive in 2020.

Still, the Chrysler Pacifica has basically zero terrain characteristics, compared to any other car or minibus, AWD or not. So it does not count as an “SUV”.

In the US market alone, about two million 3-row SUVs are sold each year. Jeep had not participated in this segment until mid-2021. Then, in just a quarter of an hour, Jeep began deliveries of not just a 3-row SUV nameplate – but two:

  • The previously mentioned Jeep Grand Cherokee L.

  • Jeep Wagoneer, which saw its production begin in another factory in the Detroit area also during the third quarter of 2021.

Jeep Wagoneer

Jeep Wagoneer is an even more brand new product for Jeep. Unlike the Grand Cherokee L, it is not manufactured in a completely new factory, but rather in an existing factory nearby, also in Detroit.

Jeep Wagoneer goes up against other large body-on-frame 3-row SUVs, mainly those from General Motors (GM) and Ford (F):

  • Chevrolet Tahoe

  • Chevrolet Suburban

  • GMC Yukon

  • Cadillac Escalade

  • Ford Expedition

  • Lincoln Navigator

There are also other large 3-row body-on-frame competitors that sell in smaller quantities:

  • Nissan Armada

  • Infiniti QX80

  • Toyota Sequoia

This is in contrast to the Jeep Grand Cherokee L, which faces a much broader field of competition in both the mass market and more premium brands:

  • Toyota Highlander

  • Chevrolet Traverse

  • Ford Explorer

  • Honda Pilot

  • Kia Sorento

  • GMC Acadia

  • Volkswagen Atlas

  • Subaru Ascent

  • Dodge Durango (Stellanti’s own sister vehicle of previous generation)

  • Kia Telluride

  • Buick Enclave

  • Nissan Pathfinder

  • Acura MDX

  • Hyundai Palisade

  • Volvo XC90

  • Infiniti QX60

  • Audi Q7

  • Mazda CX-9

  • Mercedes GLS

  • BMW X7

  • Tesla Model X

  • Cadillac XT6

  • Land Rover Discovery

To sum up: Stellantis takes on the 3-row SUV segment

During the first nine months of 2021, Stellantis sold 52,931 units of the Dodge Durango – its only 3-row SUV in the US market until the second quarter of 2021:

Stellantis Media – FCA reports sales for the third quarter of 2021 in the United States

While Stellantis sold 189,727 units of Grand Cherokee during this time, it does not break out 2-line vs. 3-line sales numbers and may not do so in the future. Wagoneer sales did not start until the end of the third quarter of 2021, so we do not yet have reliable figures available.

On an annual basis, you can probably imagine sales in the US of about 100,000 3-row Jeep Grand Cherokees and almost half as many Wagoneers. Given the valuation of many brand new car companies in the stock market today, many of which have not yet sold a single vehicle, it probably means that Stellantis will add many billions of dollars in value by entering the market with these new vehicles in 2021. will only not near the same level of credit for these achievements.

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