Jeep has unveiled new plans to release a luxury vehicle to compete with the likes of the Escalade and Land Rover, and like its competition it is expected to cost a very pretty penny.
The new line of Wagoneers and Grand Wagoneers should be ready for 2018. It’s something that company bigwigs have been dreaming about for some time.
“When I see a Range Rover on the street, my blood boils, because we should be able to do a thing like that—and we will,” said Sergio Marchionne CEO of Jeeps parent company Fiat, to Bloomberg in 2015.
This is the first time that Jeep has attempted to enter the luxury market that is populated by the likes of BMW, Cadillac, Land Rover, Audi, and Maserati. The new Jeep Grand Wagoneer, resuming a brand that was produced from 1963 to 1993, is expected to enter the market at around the upper $80,000 range and top out at around $130,000 to $140,000, fully loaded. The company’s current prices average around the $20,000 to $30,000 range, except for the Grand Cherokee, which sits at about $40,000.
The Wagoneer and Grand Wagoneer will use an extended version of the Jeep Grand Cherokees base. The CEO of Jeep, Mike Manley, has said the company is hoping to challenge the Range Rover, in particular, directly.
So far this year, Jeep SUVs, which include the Patriot, Compass, and Renegade have sold a collective total of approximately 260,000 vehicles in the US and Canada, while the much more luxury Range Rover models have sold around 55,000 units.
Recently Jeep has run into a bit of a rough patch, as Cherokee sales have dropped 12 per cent, Renegade has fallen 13 per cent, Compass has lost 16 per cent, and Wrangler down a whopping 18 per cent. On the bright side, sales of the Grand Cherokee are up by 18 per cent and Patriot sales have spiked 33 per cent. While Jeep’s Cherokee and Wrangler lines are suffering, the competing midsize SUV Toyota 4Runner is up by 21 per cent.
Jeep’s core brands have been flagging even against a favourable backdrop for the types of vehicles it specializes in.
“Virtually every company, both luxury and nonluxury, is coming out with all different sizes of crossovers and SUVs,” says Rebecca Lindland, a senior analyst for KBB.com. “That’s been Jeep’s sweet spot for so many years. The market is plateauing. When you combine increasing competition with a plateauing market, it’s not surprising that they’re going to have an off month.”
The move to upscale a brand is now a common one in the retail business as a whole, and some think it is due to a change in the economy after the economic crisis of 2008.
“There’s been a widening income gap, so those trying to make a living getting customers in the middle have been struggling,” said Dan Hess of retail research firm of Merchant Forecast.
Some brands, like The Bay and Macy’s have thrived with moves to go upscale, while others such as J.C. Penney have lost billions. What’s clear is that all other auto brands outside of the top-tier will be watching Jeep’s move with interest.
Below: The Jeep® Wagoneer: A History Maker