Jeep’s CEO Implements A Recovery Strategy Following Sharp Drops In Sales

Stellantis’ Jeep brand faces a challenge of achieving 1 million vehicle sales domestically by 2027, despite a five-year annual sales decline in the U.S., with 2024 potentially becoming the sixth consecutive year of decline. 

The brand’s success in challenging terrains will be crucial for its future growth.

The company is executing a turnaround plan

Jeep CEO Antonio Filosa believes the brand’s darkest days are behind it, and it is still conceivable to meet the 1 million sales goal. 

The company is implementing a recovery strategy that involves cutting prices throughout its lineup, giving special deals, increasing marketing and advertising investment, and an impending dealer tour to address other issues. 

However, Jeep’s average transaction costs have risen from less than $40,000 in 2020 to more than $50,000 this year, according to Cox Automotive. Jeep’s average transaction price has been above the industry average since 2021.

In an interview, Filosa said “The good thing is that the actions we implemented in the previous months, they are also resulting in important growth as well in the U.S.” 

Filosa’s remarks came the day before Carlos Tavares, the CEO of Stellantis, was the object of a critical open letter regarding the company’s sales losses and other business choices written by the chairman of the Stellantis National Dealer Council.

In the United States, Stellantis sold about 1.5 million cars last year, a decrease of about 1% from 2022. In contrast, the industry is expected to grow by 13% in 2023.

Jeep saw U.S. sales rise last month

Last month, Jeep reported a 28% increase in US sales, up from August 2023 and 55% from July, while reducing its car inventory by around 25,000 units. 

However, Jeep’s US sales fell 34% from a record high of over 973,000 SUVs in 2018 to fewer than 643,000 last year. 

The declines were mostly due to the firm discontinuing manufacture of the entry-level Renegade and Cherokee small SUVs, which had peak US sales of roughly 300,000 units per year from 2016 to 2019.

Filosa said “For Jeep to lose Jeep Cherokee … and Jeep Renegade has been an important hit to us, Our market coverage declined from an average of 80% to 45%.”

Filosa stated that by the end of the following year, when it unveils an unidentified replacement for the Cherokee along with new electrified models, Jeep hopes to regain market share “very quickly” and return to an 80% market share coverage, which covers the segments in which Jeep competes.

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