Jeep®, known for its legendary off-road capability, is facing a new kind of challenge—a significant five-year-long sales decline in the U.S. Despite the struggles, Jeep’s CEO, Antonio Filosa, is optimistic about the future. He believes the brand’s worst days are behind it and has initiated a turnaround plan to recover market share and reach the ambitious goal of selling 1,000,000 vehicles domestically by 2027.
“Now it’s time to push, and to accelerate, sales to recover as much as [they] need to do,” Filosa said in an interview with CNBC. He acknowledges that this year has been tough, with Jeep’s U.S. sales declining by 9% in the first half of 2024. However, recent data shows some progress, with sales rising 28% in August compared to last year and 55% compared to July. Filosa views this as a sign that the plan is starting to work.
The CEO’s strategy includes lowering prices across Jeep’s lineup and offering special promotions such as incentives and 0% financing. Popular models like the Jeep Compass (MP) and Grand Cherokee (WL) are at the forefront of this pricing shift. Additionally, Filosa has increased Jeep’s marketing and advertising spend by 20% in the year’s second half. He also plans to address concerns through a roadshow with dealers next month, aiming to strengthen ties and listen to their input on how to improve the business.
These efforts come with challenges. The cost-cutting and focus on profitability under Stellantis CEO Carlos Tavares have resulted in Jeep’s U.S. market share dropping to 45% after the company discontinued key models like the Jeep Cherokee (KL) and Jeep Renegade (BV). Together, those models represented peak annual sales of about 300,000 units between 2016 and 2019. “For Jeep to lose Jeep Cherokee… and Jeep Renegade has been an important hit to us,” Filosa admitted.
However, Jeep plans to recover its lost ground by introducing new models by the end of 2025, including electrified versions of popular SUVs and a replacement for the Cherokee. Filosa is confident that these launches will help restore Jeep’s market share to 80%.
On the product front, Jeep has several new electric vehicles in the pipeline, including the all-new, all-electric Wagoneer S (KX), the upcoming Jeep Recon (EJ), and Wagoneer and Grand Wagoneer (WS) 4xe models. “I believe [next year] will be a completely different story,” Filosa said, hinting at the impact of these models on the brand’s growth.
Despite these developments, quality remains a top priority. Jeep has faced issues in this area, with the National Highway Traffic Safety Administration (NHTSA) investigating more than 781,000 Jeep Wrangler (JL) and Gladiator (JT) vehicles over reports of underhood fires. Filosa acknowledged the probe but refrained from providing further details. Instead, he emphasized that the company monitors quality closely, particularly for the new Wagoneer S and Recon models. “The only mandate that the plants have from me is to just deliver the car when it’s in perfect quality,” he said.
The upcoming electric models will be built at Stellantis’ Toluca Assembly Plant in Mexico, but the production location for the Cherokee replacement has not yet been confirmed.
With these initiatives in place, Filosa remains optimistic about Jeep’s future, even as the company faces significant challenges. He sees 2025 as a year of opportunity, with new products, a focus on quality, and a renewed effort to engage with dealers, driving the brand’s recovery.
Source: CNBC.com
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