When Sergio Marchionne said that Jeep posted “XXX” results in Europe in 2017, analysts started to look for the reasons of this timid growth. Jeep competes in the hottest selling segment but it didn’t make use of the booming demand as its range wasn’t competitive enough. Jeep aims to sell 1,9 million units by the end of this decade but the brand needs to address some product issues first.
European situation can be an example of how growth can be affected by the lack of new cars, with consequences not only in Europe but also in other markets. China is one of them. It was already Jeep’s second largest market after USA in 2017, and is set to become the main source of growth in the coming years. Jeep is by far the most popular brand of FCA in China thanks to its SUV range and to the enormous popularity of SUVs among consumers.
The brand has just revealed the all-new Commander, which is part of its strategy of enlarging sales through more products. This new Jeep is not just another launch but something more. It is the first Jeep exclusively developed and conceived for the Chinese market. The Commander aims to expand Jeep’s success in China by sitting above the Grand Cherokee in terms of size and capacity.
It is the fourth locally-produced Jeep after the Renegade, Compass and Cherokee. Even if it is bigger than the Grand Cherokee, its entry price is half the price of the Grand Cherokee. This is because Jeep wants to position the Commander as the full-size SUV which is not necessarily associated to luxury. The new entry is set to rival with the Volkswagen Teramont (aka Atlas), Buick Enclave and GAC Trumpchi GS8.
Sales for the 7-seater mainstream big SUVs are soaring in China. Last year there were around 260.000 units sold, jumping from 25.000 units in 2016. The strong growth is explained by the latest arrivals, which have met the needs of consumers in China. Another fact that positively affects the segment is related to a more relaxing unique-child policy. Size of families in China are expected to grow in some regions and this will have an impact on the size of cars.
So far nothing has been announced regarding the Commander’s commercialization outside China. FCA has said it is a Chinese made product for local market, but the brand could use this model as the base for developing a dedicated model for North America. In fact, Jeep’s range in North America also needs a bigger SUV than the Grand Cherokee. An American version of the Commander could perfectly face competitors such as the Chevrolet Tahoe or Honda Pilot.