Jeep – dubbed America’s “most patriotic brand” – which is planning a comeback in one of the fastest growing sport utility vehicle (SUV) markets in the world, will expand its model range in India with the launch of the Meridian and Grand Cherokee later this year. In the first 10 months of 2021-2022, SUVs accounted for 42 percent of sales in India’s passenger car market.
The Meridian, the company’s three-row SUV that made its global debut as the Commander last year, is likely to go on sale this summer. The high-volume model will be key to Jeep’s comeback in India, Christian Meunier, global CEO, Jeep, said on Tuesday while speaking to Indian media from Detroit.
“I am not satisfied with the volumes in India. That’s why I want Brazil to be the benchmark. In Brazil, we sell 15,000 units a month with three models. In India, we made 4,000 units of two models (the Compass and the Wrangler). We have to grow in this market and push the boundaries, says Meunier. India will be the only market outside the US to have four Jeep nameplates.
The Meridian provides an opportunity for higher volumes and will help the American car brand expand its manufacturing footprint in India, Meunier said. Strategically, India will be an export hub for right-hand drive models.
A derivative of the Compass, the seven-seat model will be launched with more than 80 percent of the parts sourced locally. It is expected to cost between ~25 lakh and ~30 lakh and will be pitted against the likes of Mahindra XUV700, Innova Crysta and Kia Carnival among others.
The Meridian will be available in three powertrains; two trims will only be offered in the diesel variant.
The fifth generation Cherokee will follow the Meridian. By the end of 2022, Jeep will have a portfolio of four nameplates – either locally assembled or manufactured in India.
“Jeep has deliberately adopted a branding strategy that appeals to the emotions. This has helped it justify premium pricing,” said Ravi Bhatia, CEO and director at JATO Dynamics, an automotive company. The other side of the premium position is that the playing field is naturally narrow.
The very fact that most SUVs are actually soft roaders and modified hatches, and that the market for “true blue SUVs” is quite small, may very well work in Jeep’s favor. “Given the strategy choice, the new product direction makes sense,” says Bhatia.
The 80-year-old all-American classic SUV brand indelibly linked to freedom wants to capitalize on the premiumization trend in a market it entered in 2017 with the high-end Wrangler Unlimited and Grand Cherokee, followed by the built-in India Compass. But it all soon spilled out. Sales of the Compass averaged 1,000 units a month. A delay in bringing out updates and new models pushed it to the fringes of a market where competition was growing by leaps and bounds.
Regaining its lost luster can be an uphill battle, says Puneet Gupta, director of IHS Automotive, a sales forecasting and market research firm. “Due to the delay in launching products for the Indian market, Jeep lost the momentum it had built with the Compass. Given the intensity of competition in the SUV market, it may not be an easy journey for the brand to make deep inroads,” he adds.
Commenting on whether a small compact SUV is under consideration, Meunier said: “We would love to have a sub-four meter model in India. We are studying it. But we have to do it the right way. We don’t want to take a hatchback and make it look like a Jeep.”
Jeep and Dodge brand maker Stellantis, which was formed last year through the merger of Fiat Chrysler and France’s PSA, is committed to making its India operations financially viable, said Roland Bouchara, CEO and managing director, Stellantis India. “We are on the way to making the business viable in India and localization will play a very important role in that,” he says.