√Jeep remains committed to Australia as prices rise and sales fall short of ambitious targets

Following a series of sharp price rises over several months, US off-road specialist Jeep says it remains committed to Australia even though sales are a fraction of its goal to hit 50,000 annually – and less than a third of its previous record.

The global boss of Jeep, Christian Meunier, says the US off-road specialist remains committed to Australia – and right-hand-drive markets globally – even though the company is selling vehicles at a fraction of the rate it foreshadowed three years ago and well short of its previous local record.

The top Jeep executive also defended the series of sharp price rises over the past 12 months – including on vehicles that had not gained any extra equipment – insisting the company was not profiteering, but rather passing-on higher production and logistics costs, as have many other car companies.

When asked about Jeep Australia’s recent sales results of about 7000 to 8000 vehicles per year – against the backdrop of a stated goal to hit 50,000 annually, which is significantly more than the record of 30,000 set in 2014 – Mr Meunier told Australian media at the Detroit motor show:

“So what we’re doing in Australia is trying to get the business of Jeep back on track. The last time I was in Australia … I think there was a lot of good energy and then ‘boom’ … a month later everything locked down (due to COVID-19).

“Today I think we’re doing much better than we used to. Obviously there has been semiconductor issues (and a) shortage of Wranglers. Grand Cherokee was supposed to launch earlier (but) it was delayed. So a lot of logistical issues.”

When asked if Jeep Australia’s sales ambition of 50,000 vehicles a year – the goal stated without a specific deadline by Mr Meunier in late 2019, during a media preview of the Jeep Gladiator pick-up in New Zealand – was too ambitious, the executive said:

“I think we’re going to sell about 8000 (vehicles in Australia) this year, it’s not really what I think is a good number for Jeep. You know what my projection was (50,000) and I still think we can do that.

“I think we’re doing better, much better than we used to. I think we’ve changed quite a lot of things. I think the dealer engagement is better. The positive thinking is there.”

When asked if Jeep head office was still behind the Australian market, Mr Meunier said: “Completely, completely. The right-hand-drive strategy is clear. You know, we’re investing for Japan, Australia, New Zealand … South Africa is becoming now a pretty serious market for us.“

However, Mr Meunier noted, not all right-hand-drive markets were prospering.

“The UK is a struggle. I’m not going to deny the UK has been a struggle for a while. We didn’t have the right cars, we were importing the Compass from India at the time, but the UK is more European, all the connectivity and everything is more European.

“So now we’ve made the decision to get a European car from … Italy which is going to be a good asset.”

When asked if Jeep Australia’s recent rounds of sharp price increases were motivated by profits or rising costs, Mr Meunier said: “Raw materials, inflation and everything. Obviously we had some price recovery to make on (profit) margin.”

Then, in a response that appeared to be at odds with the stated sales goal of 50,000 vehicles per year, Mr Meunier said: “I think one of the reasons why Australia was really struggling is (only) chasing volume.

“They were chasing volume and not achieving it. They were pushing the metal. They were not brand-focused. We’re not making a lot of money, dealers were not making money, and that’s the vicious circle.

“What we’ve done is we’ve stopped all these entry versions … we’ve enriched the portfolio, we’ve made it more premium. So we have well-equipped product. We’re not going after the Koreans, we’re not going after the Chinese. We’re not a mobility brand, we don’t sell transportation. We sell adventure.”

When asked to clarify if it was still possible to increase sales and profit at the same time, Mr Meunier said:

“The pricing you have in Australia is pretty consistent with what we have in Japan or what we have in Europe or North America.”

Locking-in future models for Australia, Mr Meunier said Jeep – and its parent company Stellantis – has been successful in right-hand-drive markets where rival General Motors was not, an oblique reference to the US giant getting out of Australia, the UK, Thailand, and India three years after closing the Holden factory in Adelaide.

“I’m not going to be sarcastic,” said Mr Meunier, “but GM had struggled for many years with Opel in Europe. And Opel is now part of Stellantis and very profitable.

“So I think there are a lot of things you can do differently. And we can we can be profitable in right-hand-drive (countries) as long as you bring the right product with the right (engine options) in the right segments.

“The future models for the vast majority of our product (petrol or electric) are going to be right-hand-drive as well. We want to grow our business in India and the Asia-Pacific. The region has a lot of ambitions.”

Jeep sales in Australia over the past 22 years:

2022 (January to August): 4748, down 8.4 per cent over the same period the year prior
2021: 7762
2020: 5748
2019: 5519
2018: 7326
2017: 8270
2016: 12,620
2015: 24,418
2014: 30,408
2013: 22,170
2012: 18,014
2011: 8648
2010: 5975
2009: 4193
2008: 5232
2007: 5744
2006: 5099
2005: 5078
2004: 4502
2003: 4389
2002: 4569
2001: 3584
2000: 3732