Jeep, the crown jewel of Fiat Chrysler Automobiles NV, is re-entering the popular mid-size truck market for the first time in more than two decades.
Sales of smaller pick-ups have surged in the past few years, and Fiat Chrysler, with its Jeep and Ram brands, hasn’t had a dog in the fight since it discontinued the Dodge Dakota in 2011. Ram will add a midsize truck in 2022, according to the company’s latest five-year plan, but in the meantime, the Italian-American automaker is relying on the brand magic of Wrangler to haul in some extra profits.
The Gladiator, which debuts at the Los Angeles International Auto Show today, looks like a Wrangler with a pickup bed, which makes sense because it’s based on Jeep’s best-selling product. But Tim Kuniskis, who took over Jeep from now-chief executive officer Mike Manley just last month, is pitching Gladiator as a dedicated truck, like its 1980s ancestor of the same name.
Gladiator “is a midsize pickup; it’s going to compete in that segment, and it’s going to set the benchmark,” Kuniskis said at a preview in Auburn Hills, Michigan, earlier this month.
“But, by design and by plan, you can’t look at this and not think Wrangler.”
To bolster Gladiator’s truck cred, Fiat Chrysler lengthened the Wrangler wheelbase by 19 inches (482.6mm) and gave it a modified high-strength steel frame, adding 400 pounds (181 kg) in the process. The new model still has Wrangler’s fold-down windshield, removable top and doors, and four-wheel drive to go off-roading.
Gladiator is the first Jeep pick-up since the Comanche, which Chrysler discontinued in 1992. It’s coming to a party that started about four years ago, when General Motors Co revamped its Chevy Colorado for a segment Ford Motor Co and Fiat Chrysler had abandoned to Japanese automakers, who popularised smaller pickups in the US during the 1970s and 1980s.
Sales of these trucks have doubled since 2014 and will surpass a half-million units globally this year, according to IHS Markit, with GM and Toyota Motor Corp.’s Tacoma reaping most of the gains. The breakneck pace isn’t expected to continue: IHS forecasts sales will level off around 586,000 in 2020.
Room for Latecomers
There is room for latecomers, according to Stephanie Brinley, an analyst with IHS. Ford also is re-entering the segment next year with a new Ranger; the automaker discontinued the previous model in 2011.
“Even though we’ll see a contraction in sales, and vehicles get more expensive, it’s still a healthy market and we’ll still see opportunity,” she said.
Brinley views the Gladiator as more of a niche product “in the lifestyle side of pickup demand.” It won’t match the volumes of the Colorado or Tacoma, or even the Wrangler, but will have “good profitability,” she predicted. Fiat Chrysler sold 204,269 Wranglers in the first 10 months of this year.
Kuniskis said he’s aiming the bulk of new Gladiators at the North American market. Production at the Toledo, Ohio, Wrangler plant is scheduled to start in April, according to the United Auto Workers. The trucks will go on sale in the second quarter of 2019.
The company is mum on pricing, but Cass Burch, who owns a pair of Chrysler, Jeep, Dodge and Ram dealerships in south Georgia, said he hopes the new pickup will cost somewhere between $35,000 to $45,000, (RM146,296.50 to RM188,095.50) depending on the trim level.
Prices for the 2019 Colorado will range from $20,500 to $40,900, (RM85,687.95 to RM170,957.91) according to market researcher Edmunds.
While some industry observers say the Gladiator could bite into Wrangler sales, Burch dismisses that idea. He says the open storage of a pickup makes it a different product, and customer demand has always been there: Mopar, Fiat Chrysler’s parts unit, at one point offered a truck conversion kit for the Wrangler, and other custom-made Jeep trucks, like the Brute, go for almost $100,000 (RM417,990).
“We expect to sell every one we can build, and we expect it to be incremental business,” Burch said. “We don’t see any cannibalization at all.”
Midsize trucks have made a comeback in part because their larger siblings - the Ford F-150, Chevy Silverado and Ram 1500 - have gotten so expensive. The price differential between a full-size Silverado and a midsize Colorado, for example, is almost $10,000 (RM41,799) today, versus about $6,500 (RM27,169.35) a decade ago, according to Edmunds.
With the Gladiator, Fiat Chrysler can try to pick off would-be SUV buyers and urban dwellers it’s been losing to GM and Toyota, said Ivan Drury, an analyst at Edmunds.
“It’s a good thing for FCA that they’re building it off a capable platform with a very loyal following,” Drury said. “While they are late to the game, they’re putting a very strong foot forward.”