Top two Jeep sellers on hiatus, excess inventory to blame
American manufacturer Stellantis has confirmed to US media outlets including the Wall Street Journal that it has paused production of the Jeep Wrangler and Grand Cherokee in recent days, without however specifying the reason or duration of the interruption. Things were expected to return to normal on Thursday.
“Stellantis continues to take the necessary steps to improve its U.S. operations,” a spokesperson said in a statement to justify the ‘production adjustments’.
He added that “the company will continue to monitor the situation to assess whether further action is required”.
Stellantis had announced in December 2023 that the Detroit (Michigan) plant that manufactures the Grand Cherokee would temporarily switch from three to two shifts and reduce production, but without specifying to what extent. At the same time, we learned that the Toledo (Ohio) plant which assembles the Wrangler would limit itself to a conventional two-shift schedule, and would also cut production. Both actions resulted in significant layoffs.
Then, last July, after reporting lower-than-expected financial results for the first half of 2024, Stellantis said it wanted to quickly implement concrete solutions to the various operational problems, citing reduced production and lower prices in both the USA and Canada. In short, the Group wants to better adjust supply to demand and further reduce labor costs.
At the beginning of August, U.S. Jeep dealers had the equivalent of four months' inventory, compared with an industry average of 68 days.
Handicapped by high prices, the Wrangler and Grand Cherokee are also struggling to find takers and move out of the yards on our side of the border. Their sales in the first six months of the year were down by 33% and 19% respectively compared with the same period in 2023.
