Next-Gen Jeep Compass Shelved For India; New Creta-Rivalling Model In The Works

Key Highlights:

• The Project was codenamed J4U.
• The next-gen Jeep Compass Failed to be Commercially Viable for the Indian Market.
• The 2026 Compass was supposed to be based on the STLA-M platform.

Stellantis shelves the Next-Gen Jeep Compass in India, due for a 2026 India launch. Stellantis, the fourth-largest automobile manufacturer in the World, due to commercial viability issues in the STLA-M platform based upcoming next-gen Jeep Compass, code named J4U, has decided to pull the plug on the launch of the 2026 Compass model in India.

Why not India?

The development of J4U would have demanded a further investment of well over $400-500 million, or approximately Rs 3344 crore to 4180 crore since it was necessary to build an entirely new product upon the STLA-M platform. It was also understood that Jeep and Citroen planned to use this platform not only for the next generation Jeep Compass but also for producing similar sized Peugeot SUVs which are planned to be exported from India to Malaysia. However, the company failed to generate enough demand to ensure adequate Compass sales in India or sufficient forecasts for Peugeot SUVs sales in Malaysia, which made it impossible to achieve the necessary production numbers for the project to be profitable.

The first of these was the STLA-M platform cost structure, on which the firm intends to base a new generation of vehicles including sedans, crossovers, SUVs and more with provisions for connectivity, advanced infotainment and ADAS. The possibilities to base the platform on both full-electrical and ICE power were beneficial for the platform’s prospect, which could help create a full-electric Compass along with traditional ICE versions of Compass. However this flexibility increased development costs greatly and moved it beyond initial estimates of 1. 7 times per annum as disclosed by the project suppliers in the J4U project. The financial side of the project proved to be unmanageable and infeasible, especially under the strict cost constraints reflected in the new leadership of Stellantis headed by Carlos Tavares, the global CEO.

The 2024 Jeep Compass

Jeep sources indicate that the current Compass model will also be manufactured beyond 2026 in India to keep the product cycle going, relying on minor design tweaks. The Compass in the current generation, which was first introduced in the Indian market in July 2017 and updated recently in 2021, has remained Jeep India’s biggest seller, moving between 1,500 and 2,000 units per month during the financial year 2017-2018. Nevertheless, current sales have declined, and we are currently selling only close to 270 units per month for the past six months. 

Although there were discussions in the past that suggested the company planned to add a petrol engine back to the car since it was removed in May 2023, it seems that this plan was dropped due to the low demand as well as the expenses raised concerning the development of new engines and their homologation. Therefore, the current Compass will continue to come with a diesel engine only, at least for several years.

Source Link: AutoCar India

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