Jeep Cherokee’s distinctive redesign a dazzling success for Chrysler

New model far outpacing predecessors, expectations

6/15/2014
BY TYREL LINKHORN
BLADE BUSINESS WRITER
Fully assembled Jeep Cherokees roll along the line at the Toledo Assembly complex. Chuck F. Padden, plant manager, said: ‘‍[This facility] will be one of the largest manufacturing sites in North America with both plants running full tilt,’‍ referring to the two Jeep models built there, the Wrangler and the new Cherokee.
Fully assembled Jeep Cherokees roll along the line at the Toledo Assembly complex. Chuck F. Padden, plant manager, said: ‘‍[This facility] will be one of the largest manufacturing sites in North America with both plants running full tilt,’‍ referring to the two Jeep models built there, the Wrangler and the new Cherokee.

Herman Melville once wrote that it is better to fail in originality than to succeed in imitation.

Perhaps the American poet and novelist was required reading for Jeep’s designers, because the Jeep Cherokee is anything but another humdrum copy for the me-too compact utility segment.

There is no mistaking a Cherokee approaching in the rear view mirror. With its curiously stacked headlights and steeply raked seven-slot grille, the Jeep looks like nothing else on the road.

The styling was a daring decision for a heart-of-the-market vehicle, but the Cherokee, built in Toledo, has proven to be a solid success.

Through this year’s first five months, Chrysler Group sold 67,095 Cherokees. That’s more than its predecessor, the Jeep Liberty, managed in its last full year of sales in 2011.

It’s also more than many analysts expected.

“It’s probably the biggest success story of the year,” IHS auto analyst Tom Libby said.

At the current rate, Jeep is on pace to sell 161,000 Cherokees this year. That would be considerably more than Mr. Libby had projected prior to the Cherokee going on sale last year, but still trails by a wide margin established segment stalwarts such as the Chevrolet Equinox, Ford Escape, Honda CR-V, and Toyota RAV4.

The Escape and CR-V both sold about 300,000 units last year, while the Equinox and RAV4 were above 200,000 units. All four models have significantly outpaced Cherokee sales this year.

But analysts say the Cherokee’s success shouldn’t be judged too much on where it slots into the sales chart against those competitors.

“They’re not concerned with reaching the CR-V and RAV4 levels,” Mr. Libby said. “They’ve really met their criteria, and they don’t really worry about other models at this point.”

The base price of a Cherokee is $22,995, slightly more than an Escape, but a little less than the CR-V and RAV4. The Equinox, with a base price of $24,440 is the most expensive, but it is also slightly larger than the others.

Locally, the Cherokee has become one of the best-selling vehicles.

Through April, the Toledo Auto Dealers Association said local dealers had sold 194 Cherokees. That ties it for second overall and makes it the best-selling vehicle that isn’t a pickup truck. The area’s best seller continues to be the Chevy Sliverado, while the Ram 1500 tied the Cherokee.

Doug Kearns, general manager of Toledo’s Yark Automotive Group, said the Cherokee has become the No. 1 seller at Yark’s Jeep dealership and one of its top two vehicles overall, averaging about 40 sales a month.

“I think the vehicle really starts to grow on you,” Mr. Kearns said. “Consumer response has been outstanding. They love the styling, they love the ride, the features. And think [Jeep] did a nice job with the different trim levels.”

Jeep Cherokees are lined up outside Yark Automotive in Toledo. The dealership says the new Cherokee has become its best-selling Jeep.
Jeep Cherokees are lined up outside Yark Automotive in Toledo. The dealership says the new Cherokee has become its best-selling Jeep.

The Cherokee’s unconventional styling still hasn’t grown on Dave Sullivan, an analyst with AutoPacific Inc. who couldn’t quite believe what he was seeing when Chrysler first showed the Cherokee to a select group of industry insiders.

However, Mr. Sullivan said last week the vehicle is an undeniable success.

“The looks appear to have really grown on people. I am totally blown away with how popular this car has been.”

While Mr. Sullivan is not wild on the Cherokee’s design, he is sold on its attributes. He recently drove a four-cylinder Trailhawk, Jeep’s off-road ready Cherokee model, and came away impressed.

“I could not believe how capable that vehicle was,” he said.

The Cherokee has been one of the primary reasons for Chrysler Group’s sales growth this year. The vehicle filled one of the biggest holes in the automaker’s lineup and gave a big boost to the already strong Jeep brand.

Year to date, Jeep sales in the United States are up 49 percent. Much, but certainly not all, of that is because of the Cherokee. Sales of every other Jeep model are up at least 13 percent over last year. Even Jeep’s oldest models, the Compass and Patriot, are up 28 percent and 18 percent respectively.

In 2016, those two models will be replaced by a single Jeep. Analysts say that should create a bit more differentiation in the Jeep lineup, and could serve to boost Cherokee sales.

Cherokee, incidentally, is scheduled for its first minor updates that same year.

Importantly for Chrysler Group and Jeep specifically, Cherokee is bringing new buyers to the brand.

According to trade-in data from car-shopping Web site Edmunds.com, more than 75 percent of people buying a Cherokee traded in something other than a Jeep.

Further, Edmunds said 63 percent of vehicles traded in on a Cherokee were from outside Chrysler Group.

Brian Alexander, a salesman at Yark Automotive, points out the highlights of the console of the Jeep Cherokee Latitude edition to Jessica Oetjens of Toledo as she picks up her new SUV.  The Cherokee Latitude is the first new car she has bought, she said.
Brian Alexander, a salesman at Yark Automotive, points out the highlights of the console of the Jeep Cherokee Latitude edition to Jessica Oetjens of Toledo as she picks up her new SUV. The Cherokee Latitude is the first new car she has bought, she said.

Dealers call those conquest sales, and they’re important in growing a brand’s market share.

The Cherokee is gathering those conquests at a much higher clip than its primarily competitors. For example, Edmunds said 49 percent of Escape buyers were new to the Ford brand, while just 33 percent of Equinox buyers were new to GM.

“It’s worth keeping in mind that the Cherokee is a new name plate and thus can be expected to garner more attention from other brands,” said Jeremy Acevedo, an analyst at Edmunds. “Still, the Cherokee does a commendable job capturing former import owners, and has done particularly well conquesting domestic brands.”

Edmunds found 6 percent of Cherokee buyers traded in a Toyota, while 8 percent traded in a Chevrolet. On their face, those numbers don’t look big, but Mr. Acevedo said they show that a significant amount of Cherokee drivers are not traditional Jeep customers.

“With older Jeeps, you’re looking at no-frills utility vehicles,” he said. “Cherokee maintains that heritage, but it’s practical enough to entice a whole new set of daily drivers, a whole new set of buyers.”

So refined is the Cherokee that Jeep is even getting buyers who previously drove BMWs. Edmunds said 2.1 percent of Cherokee trade-ins have been BMWs.

Michael Barchick, vice president and general manager of Charlie’s Dodge Chrysler Jeep Ram in Maumee, said there has been great customer acceptance on the Cherokee.

“In terms of sales it’s actually going better than what I thought it would be. We use to do 5 to 10 [Libertys per month]. The Cherokee, we’re doing 25 to 30. People love the style, they love the looks. We’ve done very well with it.”

Contact Tyrel Linkhorn at tlinkhorn@theblade.com or 419-724-6134 or on Twitter @BladeAutoWriter.