Jeep eyes sub- ₹25 lakh segment to stay 'relevant' in India

The brand, part of the multinational automotive giant Stellantis, has struggled in its eight-plus years in India – Its models like the Compass and Meridian have made little headway, largely owing to their relatively high prices, and the lack of a 'mass-market' product.

Now, it may be set to change that.

"If we want to stay relevant in India, we have to play in the sub- ₹25 lakh market for SUVs", Shailesh Hazela, MD and CEO, Stellantis India, said in an interview. "It's (the plan) is on the drawing board. We are taking the time to understand what works, how we integrate, and how we can achieve our objective," Hazela said.

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"It is at the top of the leadership's mind," he said.

Jeep could be planning a more affordable variant of its Compass SUV and an upgrade of its 7-seater SUV Meridian, in order to attract a broader customer base. While Jeep's sales in India have been impacted by the discontinuation of its petrol engine, export volumes are rising, with the Meridian being sold in markets like Japan and Australia. Notably, 40% of Jeep's volumes come from exports.

Bet on Citroen

Stellantis is also betting on its French brand, Citroen, to strengthen its presence in India. Citroen's upcoming launch of the Basalt, an SUV coupe, will compete against upcoming mid-sized and premium SUVs from Tata and MG Motor India.

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Shishir Mishra, brand director at Citroen India, said the brand plans to more than double its dealerships from 85 to 200 by the end of 2024. "The expansion will target tier-2 and tier-3 towns and deepen our presence in existing tier-1 markets we are present," Mishra said. "We have the confidence of our existing dealers to expand with us. We are opening Stellantis brand houses that will include both Jeep and Citroen for operational efficiencies. We're also introducing smaller format showrooms to reduce initial investment and help dealers reach breakeven faster", Mishra said.

Citroen, which launched in India in 2021, currently has a portfolio of five products. Stellantis has invested ₹11,000 crore in India, establishing extensive export operations to Europe for engines and transmissions, in addition to vehicle manufacturing.

Hazela also highlighted the importance of local engineering for Citroen in India. "The first learning we did for Citroen in India is to engineer our products locally. We didn't have a legacy in India and we wanted to become mass market. Our learning is that you can become irrelevant very soon if you increase the price. We didn't want to have the perception that a feature-rich brand is out of reach. We needed to make our cars affordable by integrating local solutions and local costs with local engineering. This long-term approach is what we follow in all our endeavours. We don't just copy-paste policies from Europe. Stellantis' culture encourages us to do what matters and do what is right", Hazela said, responding to a question on why some of the brand's products have some notable exclusions, such as a sunroof, or a start-stop key, or electronic seat adjustment controls.

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"We are taking the right actions and constantly evolving based on customer feedback. We are a young brand focused on action. It's too early to draw conclusions about our performance. We are in investment mode and committed to further investments in the country", Mehra said, explaining that Citroen will continue to invest in India and isn't seeking immediate profitability.

Hazela, however, expressed optimism about Citroen's financial prospects in India. "We aim to achieve Ebitda breakeven soon. Our cars are engineered in India and are 98% localized, so there is no external factor that impacts us", he said.

He added, however, that Stellantis India at large generated cash last year, and is on track to do this year as well.