Stellantis, the world’s fourth-largest automaker, has cancelled the next-gen Jeep Compass, which was due to launch in the Indian market in 2026. The project, codenamed J4U, was under development for over a year. Sources say it failed to meet commercial viability for the Indian market, forcing Stellantis to cancel it.
Instead, the company is looking at leveraging the Citroen Smart Car or Common Modular Platform (CMP) to develop a new B segment Jeep, in place of the more expensive STLA Small platform. The new model was announced as the new Jeep Renegade at the brand’s investor day presentation.
That’s a marked shift in strategy. However, the shift to the more cost-effective CMP isn’t unprecedented. The company’s fourth-generation Citroen C3, sold in Europe,
switched to the CMP when it was launched in late 2023.
Jeep is yet to confirm the platform underpinning the new Jeep model but Stellantis CEO Carlos Tavares, while speaking to our sister publication Autocar UK, alluded to
the CMP, saying, “That platform has the capability to be sourced all over the world, with simpler solutions that make it much more cost-competitive than anything else
we can find in the western world.”
Such a CMP-based model is likely to be priced between Rs 15 lakh and Rs 20 lakh in India, say people in the know, compared to the Rs 20 lakh to 30 lakh range that Compass currently retails for. This also means that the new generation Jeep Renegade will be the mainstream Jeep model in India after its launch in the next 24-30 months.
New Jeep Compass: Why it’s getting canned
The primary reason for the shift is money. The development of the new generation Compass code J4U would have entailed an additional investment of over
USD 400-500 million (Rs 3,344 crore to Rs 4,180 crore) as it involved developing an all-new product on the all-new STLA-M platform.
STLA-M is a global platform being developed by Stellantis to support a wide range of vehicle types, including sedans, crossovers, and SUVs. The STLA-M
platform also incorporates advanced connectivity features, up-to-date infotainment systems, and ADAS, with both electric and ICE options. This meant an allelectric
Compass and the standard ICE versions could be launched simultaneously.
However, all this flexibility and features have come at a cost. “To incorporate multiple powertrains and body styles has made the STLA-M very expensive,” said a
Stellantis source. Given that STLA-M is becoming more expensive than initially projected, the Jeep model for India, designed on this platform is also becoming more expensive than previously expected, making it unsuitable for the Indian market. Suppliers, who were at an advanced stage of consultation over the J4U project, said that the development overshot cost targets by 1.7 times, which
made the project a non-starter, especially in the eyes of Stellantis’ global CEO, Carlos Tavares, who is known for his brutal focus on cost control.
When contacted, a Stellantis India spokesperson said the company is not announcing any changes to its Jeep roadmap for India. “Stellantis remains committed to investing in the Indian market as it is the only country to locally produce and assemble four Jeep nameplates outside of the United States. There are no changes to the production of Jeep vehicles in India, and there are no
announcements to be made now,” the spokesperson said.
Meanwhile, the switch will impact more than just the next-generation Compass for India. The maker of Jeep and Citroen brands was also intent on producing similar-sized Peugeot SUVs for the Malaysian market based on the same platform.
Current Compass to continue beyond 2026
All this will lead to delays in the launch of the updated Compass in India, at a time when the market demands frequent product upgrades. Sales of the Compass have
declined steadily from a peak of over 1500-2000 units/ month in 2017-2018 to a dismal 270/month.
When it was launched, the Jeep Compass gave homegrown rival Mahindra XUV 500 stiff competition, but lost ground steadily against newer competition. For
example, the Mahindra XUV 700, which succeeded XUV 500, has averaged about 8,000-10,000 units per month in the last financial year.
Meanwhile, sources say the Jeep will continue manufacturing the current Compass in India beyond 2026 and will try to extend its lifecycle with occasional cosmetic upgrades, but its big bet will be the new Citroen based mid-size SUV.
This feature was first published in Autocar Professional’s July 1, 2024 issue.