Jeep and Ram’s parent company, Stellantis, is betting on cheaper vehicles as it fights for market share in what’s being described as an “emergency room” operation.
Jeep and Ram shift to cheaper vehicles to drive growth
After Stellantis’ sales in the US crashed 15% last year, the automaker’s most profitable market, CEO Carlos Tavares, abruptly resigned.
And the fallout wasn’t just in the US. Stellantis reported consolidated shipment volumes globally fell by 12% in 2024 due to “temporary gaps in product offerings” and bloated inventory.
Stellantis described it as “a year of stark contrasts” for the struggling automaker. Left with Taveres’s mess, the company’s new CEO, Antonion Filosa, is on a mission to turn things around and recapture market share in North America and Europe.
Filosa, who took over the reins of the world’s 4th largest automaker in June, has launched what one source described to Reuters as an “emergency room” operation.
The comeback initiative is focused on driving sales growth, rather than profits, in a stark contrast to his predecessor.
Stellantis will sacrifice profits as it bets on cheaper vehicles, including under the Jeep and Ram brands, to regain market share. According to sources, the new plans are designed to draw buyers back to the brand, restore confidence among investors and dealers, and keep its facilities up and running.
“Stellantis is accelerating actions… to correct past strategic and operational decisions,” a company spokesperson said.
Reuters spoke to six separate sources: Two company insiders, two outside the company familiar with the plans, and two “representatives at major Stellantis shareholders,” all of whom wished to remain anonymous.
The new initiative reportedly has the backing of major investors, including Exor, the holding company of the Italian Agnelli family, and the French government.
A source inside Stellantis claimed the company is scrapping its EV targets in the US as Filosa makes it his main priority. The automaker aimed to have 50% of its US sales be fully electric by 2030.
In October, Stellantis announced plans to invest $13 billion, its largest yet, over the next four years to drive growth in the US and help offset the tariffs.
Top comment by Mtn Explorer
If their plan is to just offer lower priced base models of their current line up then they are toast.
The RAM midsize truck doesn’t come before 2027 due to the work being done at the Belvidere Illinois plant. And then it will enter the crowded segment with Ranger, Colorado, Canyon, Tacoma and body on frame truck(s) coming from Hyundai group.
For Jeep, the Cherokee returns on a more expensive platform. It will be built on a slightly smaller version of the RWD Grand Cherokee platform. This should be their competitor to the RAV4 but instead they will likely just cannibalize Grand Cherokee sales.
Then there is what was supposed to be the lowest priced vehicle of the bunch, the 2026 Jeep Compass. Since they decided to pause production plans in Canada this is now expected to come to the US in late 2027 as a 2028 model.
Stelantis did this to themselves right after the merger. They knew they were going to discontinue the FIAT supplied platforms under the Renegade, Compass & Cherokee back in 2021. Instead of getting the new platforms set up for North American production they decided to whine that is was California’s CARB standards that was driving up costs and costing them customers. The reality was these vehicles were on dated platforms no longer being invested in & the competition blew by them.
At this point retiring both Chrysler & Dodge brands may be needed to save them. Then hope US Jeep/Ram stabilizes & increases in Jeep Europe is enough to keep them afloat until 2028.
Although details of the so-called “emergency room” operation are still emerging, sources said it will include more affordable Jeep and Ram vehicles.
Jeep looks to regain buyers after losing market share to the Ford Bronco and other cheaper alternatives with the new Recon EV, alongside the Cherokee and Compass. Ram, which dropped plans to launch its fully electric pickup, is launching its first SUV and a new midsize truck.
In the long term, Filosa is tasked with determining which of Stellantis’ 14 brands have a viable future, according to one of the sources.
Can cheaper vehicles save Jeep and Ram in the US? It might be tough with nearly every automaker promising more affordable vehicles are coming soon. Let us know your thoughts in the comments below.
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