Jeep to drive in manufactured SUVs in India to strengthen local presence

American carmaker Jeep, part of multinational automotive group Stellantis, plans to strengthen its presence in India’s fast-growing SUV market, with two new locally assembled vehicles slated for 2022.

Jeep, which has sold more than 60,000 units of its flagship mid-size premium SUV, the Compass, since its launch in India, will bring in an India-first 7-seater SUV, the Meridian, and its luxury full-size SUV, the Grand Cherokee. to India this year. The Jeep Meridian will be manufactured locally with local sourcing for 80% of its components at the Ranjangaon manufacturing facility, a joint venture between Tata Motors and the erstwhile Fiat Chrysler Automotive Group (now Stellantis) from May, while the Grand Cherokee will be brought in. for local assembly at this facility towards the end of the year.

Jeep has also announced the launch of the new Compass Trailhawk off-roader at an introductory price of 30.72 lakh (ex-showroom).

Jeep now has a range of four indigenously manufactured models in India, including the Jeep Compass facelift and the locally produced Jeep Wrangler introduced in 2021.

“India will produce four Jeep models locally, which have more nameplates than any other market outside North America. It is also good news for new markets in the region as India becomes an export production hub for right-hand drive markets,” said Christian Meuinier, Managing Director, Jeep, to reporters in Mumbai.

Stellantis, an alliance between France’s PSA group and FCA, had outlined an investment of more than $250 million by 2021 to develop a local product portfolio of four SUVs in the Indian market. Jeep had 130% volume growth in 2021, but sales are low compared to products from more affordable South Korean rivals Hyundai and Kia.

India’s SUV market is divided into various sub-segments, with the bulk of volumes concentrated in the mid-size and sub-compact SUV segments.

Positioned in the middle of the SUV space, the Jeep Compass is priced at a premium compared to its mass-market rivals, although the automaker lacks a product in the sub-4-meter (compact SUV) category.

Meunier likens the Indian market to Brazil where Jeep is the top selling SUV brand – showing high ambitions for volumes and localization in India. However, one of Jeep’s best-selling models in Brazil is the Jeep Renegade, its smallest SUV with flagship 4×4 capability.

In India, however, Jeep has so far not found a viable business case for a compact SUV.

“It is not our intention to go under [our current offerings]. We should not play with lower hatchbacks. The question is about the business case, potential and price level for Renegade. Indians tend to prefer to buy a slightly bigger car at the same price point… We won’t stick to the volumes we sell today, but we won’t just lower the price to make the product less authentic or less Jeep,” Meunier said .

“I want Brazil to be the benchmark for India where we sell 15,000 units a month with 3 models. In India we will now have 4 locally manufactured or assembled models, and Meridian will be a volume product. We want to increase our volumes in India, but in the right way,” he added.

Jeep’s strength in the Indian market lies in the SUV D segment, which the brand plans to capitalize on the most. “We are looking at the SUV D segment which has a lot of white space, and capturing half of it. We will develop a strong share in this segment,” according to Nipun Mahajan, head of the Jeep brand in India.

D-segment SUVs are usually characterized as premium vehicles with high performance specifications and generous interior space.

On the electrification of its India product line, Meunier said: “We are waiting for India. We are in full swing in terms of electrification and we have committed to deliver a BEV (battery electric vehicle) by 2025 in all sub-segments globally. I believe that it’s really about India telling us when they are ready. There is a will from the government to push electrification but we are waiting for the factors to turn favourable.”

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