The FCA merger flooded Europe with cheap and capable Jeeps that undercut Land Rover’s price, and that could mean trouble for the British brand.
If you thought Fiat's takeover of Chrysler in 2011 only meant that US buyers would get easier access to European brands owned by the Italian automaker, then you may not have been aware that the door between the US and Europe can swing both ways. Yes, the merger gave us more freedom to buy cars from Fiat, Alfa Romeo, and Maserati, but it also meant that Europeans got models that were previously under Chrysler's wing. And now, one of those brands seems to have found traction in Europe and begun ascending towards the top.
As Autocar reports, Jeep's sales in Europe have been skyrocketing, with demand in the region shooting up 56% last year. In fact, Jeep has been doing so well that it's positioning itself to overtake Europe's most famous off-roading brand, Land Rover.
Jeep did actually beat Land Rover at the sales game last year, with the storied American off-roading marquee moving 166,500 vehicles in 2018 while Britain's equally celebrated and capable automaker sold just over 150,000 SUVs. Land Rover was still the clear winner given that the average Rover sells for £54,600 ($71,378 at today's exchange rates), while Jeep only gets an average of £27,176 ($35,527) per car sold in Europe.
Some of that has to do with the fact that Europe's most popular Jeeps aren't the pricer Wranglers, Cherokees, and Grand Cherokees, which accounted for 20,000 sales last year. No, the bulk of Jeep's European sales went to the Renegade and Compass, the former of which was designed with the European market in mind and is built in Italy. Land Rover is on the verge of striking back with a new Evoque, which is the brand's best-seller, and will follow that up with the release of the Defender. But that doesn't mean the tides can't change in Jeep's favor.
"The sustainability of Jeep's growth depends on how fast the company brings more models," said Felipe Munoz, an analyst for the analytics company JATO. "The Compass will not be able to drive the growth by itself." It's a good thing, then, that Jeep recently told us it's planning a premium seven-seat SUV that would be "positioned significantly above the Grand Cherokee." If that were to catch on in Europe, then Land Rover may have a big problem to face on its home turf.
The biggest problem for both brands, as Autocar mentions, comes from European regulators themselves. Europe is on the verge of enacting strict emissions standards that will force both automakers to release electrified versions of their cars. With both carmakers facing financial trouble but bearing names with plenty of off-roading clout, it will be interesting to see how this fight ends.