A $25,000 electric Jeep is coming to the U.S. ‘very soon’

The comments made by Carlos Tavares, who leads global automaker Stellantis, comes as car companies confront slower growth in EV sales.
The comments made by Carlos Tavares, who leads global automaker Stellantis, comes as car companies confront slower growth in EV sales.

Summary

Carlos Tavares, CEO of the brand’s parent Stellantis, says it already sells affordable EVs elsewhere in the world at a profit.

Jeep, the rugged American brand that helped popularize the SUV, plans to roll out a $25,000 all-electric model in the U.S. “very soon," the parent company’s chief executive said, the latest in the auto industry’s rush to put out more affordable EVs.

The comments made by Carlos Tavares, who leads global automaker Stellantis, comes as car companies confront slower growth in EV sales. It also coincides with complaints from U.S. dealers who sell Jeep and other Stellantis brands that the company has too many expensive models and not enough options for buyers on a tighter budget.

Auto executives have zeroed in on high prices as a major impediment to broader acceptance of EVs. Several have said they are working on cheaper battery-powered models for the U.S. market, where average selling prices for EVs in recent years have ranged from the high-$40,000s to more than $60,000.

Tavares, speaking at a Bernstein conference, said that a $25,000 all-electric Jeep is achievable in part because the company is already selling cheaper EVs at a profit in other parts of the world. In particular, he mentioned the Citroën e-C3, a hatchback being sold in Europe at €23,300. This model will eventually be offered at a lower price of €20,000, or $21,500.

“The same way we brought the €20,000 Citroën e-C3, you will have a $25,000 Jeep very soon, because we are using the same expertise," Tavares said in response to a question about EVs in the U.S.

An electric Jeep priced in the mid-$20,000 would be a major statement for the brand. The cheapest EV the parent company currently sells in the U.S. is the subcompact Fiat 500e with a price tag of about $32,500.

Tavares has previously described the $25,000 price point as a target for an entry-level EV in the U.S., but his comment at an event in New York pins it to one of the carmaker’s most important brands.

Tavares didn’t offer further details. Stellantis executives were in New York this week to unveil a fully electric version of its premium Wagoneer SUV, a model that starts at about $62,000.

Sales of electric cars in the U.S. have decelerated after a few years of strong growth, prompting several automakers to delay factory investments and new-model introductions. Surveys show that high prices relative to combustion-engine cars is a top reason keeping consumers away.

EV-market leader Tesla has said it aims to introduce more affordable models in the U.S., although it has offered few specifics on the plans.

Ford earlier this year said it plans to focus on developing smaller, less expensive EV models, in part because consumers have signaled that they aren’t willing to pay a premium over gas-powered vehicles.

Tavares’s remarks come as the company’s U.S. dealers have been complaining to Stellantis executives about not having more affordable vehicles to sell. Jeep’s U.S. sales have declined 14% through April this year, while unsold vehicles have stacked up on dealers’ lots.

Stellantis, which formed in January 2021 through the merger of Fiat Chrysler and PSA Group, has seen its market share in the profitable U.S. market slide from 12.5% in 2020 to less than 8% through the end of April, the sharpest drop among major automakers.

Tavares has prioritized maintaining high profit margins as Stellantis spends heavily to build more electric vehicles in the coming years. The CEO said earlier this year that he would adjust pricing in the U.S. only as fast as the automaker can slash costs.

A company spokeswoman said that Stellantis continues to work closely with its U.S. dealer network to address specific topics as part of a continuing dialogue, including pricing adjustments across its main brands.

Write to Ryan Felton at ryan.felton@wsj.com

 

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