Can the Jeep Compass change Fiat Chrysler Automobiles’ fate in India?

The Grand Cherokee and Wrangler monikers were highly-anticipated by many to be affordable. But, that didn't quite happen when Jeep official made its debut in India in 2016. However, would the fate for the American carmaker and its parent company, FCA change with the Compass?

By:April 13, 2017 7:05 PM

 

At a grand event in Jodhpur, American carmaker, Jeep made its grand entry into India with the introduction of the Grand Cherokee range and the Wrangler Unlimited. However, for many potential customers, it was a disappointment, particularly for Wrangler fans who expected it to priced around half of the Rs 71.59 lakh, ex-showroom Delhi retail badge it wears right now. Similarly, the Grand Cherokee was also perceived as absurdly priced, but neither FCA or Jeep announced anything about the pricing of these two products. In fact, the Grand Cherokee will remain the flagship model from the car manufacturer in India. In the midst of this disappointment, the American carmaker then announced a pleasant surprise.

This included the heavy investment in the tune of Rs 1,800 crore at the Ranjangaon facility of FCA (Fiat Chrysler Automobiles) which meant that future Jeep India products will be locally manufactured, barring the flagship models. After almost a year, the company has now unveiled its first locally manufactured SUV the Compass. Manufactured indigenously in the country, the Compass will also be exported to select Right-Hand-Drive countries which also hints that the production scale for the Compass will be relatively large in order to take care of the domestic sales as well as exports. With the official price announcement of the Compass which will happen in June 2017, there are certain other aspects that the company has to look at.

Also Read: Jeep Compass vs Hyundai Tucson or is it Compass vs Volkswagen Tiguan?

Aggressive Pricing
The company hasn’t announced or hinted at any segment competitor, but, what would really be interesting to see that despite using laser welding, plasma cutting as well as new techniques and technologies, the price has to be aggressive for whichever segment is being targeted. This, according to Jeep would greatly improve the build quality and reliability, the latter being very critical for any FCA owned brand in India. In addition to the new technology, the company is also offering a number of features as standard, over 50 of them. This means that pricing it aggressively may be a challenge which the company must do in order to achieve good sales figures.

Aftersales Network and Service
One major concern for a company like Jeep India should be a strong aftersales network. The best example of a poor aftersales strategy for Jeep India is its sister concern, Fiat India, which could have faired better. Customers nowadays expect not just a good but timely service of their vehicle. Different regions in the country have different ways in which a customer of a vehicle deals with aftersales as well as the running cost of a vehicle, which is higher in some regions than others.

 

So, what should Jeep ideally do?
Not commenting on the pricing, what can be assessed is that the Jeep Compass will surely be a gamechanger for the industry due to its new technologies. Maybe it’s the proper blow to its rivals when introduced, but the American carmaker will have to play its cards right! They cannot go wrong with the pricing else the entire game would be lost. The next challenge for them would be to get a good and if possible independent aftersales network. Jeep India has invested a lot in the India facility which means that they are banking heavily on this product to change the game for them. But, a good product can get killed if aftersales is poor. So, the company should, and could be looking at that aspect. Since June 2017 is not far, the road ahead for Jeep India is a challenging one and they need to have an upper hand right from the start with the Compass!

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