Bitche Original I saw him building a tall building and saw his building collapse. On October 31, a piece of news about GAC FCA’s bankruptcy filing appeared in the hot search, and the domestic Jeep once again withdrew from the Chinese stage.
But Jeep’s story in China is not over, but a new beginning.
On-the-spot store visit: What is the current situation of Jeep?
On the second day after the official announcement of bankruptcy, the author walked into a GAC FCA 4S store in Guangzhou. Looking at the huge exhibition hall, the Wrangler has become the only product in the exhibition, and there are only a few sales consultants.
One of the sales consultants responded to me in a Buddhist manner: "Now we only sell Wranglers in the store, and we will no longer sell domestically produced cars this year."
Another 4S store less than 30 kilometers away is still actively operating, and the Double 11 promotion is in full swing, seemingly unaffected by the negative news.
As for domestic cars, there is only one Compass test drive left for sale, with a discount of about 20,000 to 30,000 yuan.
As for imported cars, there are Wrangler, Grand Cherokee, and Gladiator on sale. Among them, the Grand Cherokee, as the main sales model, has a discount of up to about 200,000 yuan, which means that you can buy a V6 purely imported medium and large SUV for more than 300,000 yuan.
Similar meat sales are common across the country.
Although it is a stock clearance sale, consumers do not need to worry too much about after-sales maintenance. According to the sales introduction, they will continue to carry out imported car business and after-sales services in the future, and car owners can continue to complete after-sales services here.
It’s just that the highlight moments brought by domestic products no longer exist. At that time, several imported and domestic models such as the Compass, Liberty Light, Renegade, Grand Commander, and Grand Cherokee were sold at the same venue.
National annual sales can reach up to more than 200,000 vehicles, and everyone knows the advertising slogan "Not all Jeeps are called Jeeps."
Now, what brought GAC FCA back into the public eye with a high profile was a bankruptcy application. For both parties, this ending brings not only regret but also relief.
At the beginning of this year, Stellantis Group unilaterally announced that it wanted to increase the joint venture shareholding ratio of GAC FCA to 75%. GAC Group immediately denied it, laying the fuse for the collapse of GAC FCA, which was already struggling.
Since then, GAC FCA has almost been in a state of suspension of production. In February, it produced 35 vehicles. In March and May, its production and sales were both 1 vehicle. In April and June, its production and sales were both 0. The factory in Guangzhou has been taken over by GAC Aian and transformed into Aian's second factory; the remaining Changsha factory is also rumored to be taken over by BYD or Leopao.
Accompanying the sluggish production and sales data are high debts. As of June 30, 2022, GAC FCA’s total assets were 7.657 billion yuan, total liabilities were 8.186 billion yuan, and the asset-liability ratiois 107%.
On July 18, Stellantis issued another announcement, saying that in view of the current situation of GAC FCA, it was negotiating with GAC to dissolve the joint venture factory of GAC FCA, and Jeep would adopt an asset-light approach to continue to develop in China.
If they are entangled with each other, it is better to break up and live separately. This may be the best ending. GAC Group has lost its "hot potato", and Jeep has set up its own business to achieve maximum benefits at the lowest cost.
It’s just that China’s automobile landscape is undergoing earth-shaking changes. As a lone warrior, can Jeep make a comeback in China?
The space left for Jeep is getting narrower
Back in 1983, BAIC Motor signed an operating contract for "Beijing Jeep" with AMC (American Motors Corporation), to which Jeep belonged at the time, becoming China's first Sino-foreign joint venture vehicle manufacturer.
This is Jeep's first opportunity in China, which coincides with the budding period of Chinese automobiles. The Grand Cherokee was the first to roll off the production line with CKD assembly. At that time, China only had Shanghai, Hongqi and Soviet cars, and it quickly became popular and opened up brand recognition early.
Chrysler was later merged by Daimler-Benz, and in 2002 the joint venture subject of Beijing Jeep became Beijing Benz, ending the history of the first domestic production.
In 2014, Chrysler was acquired by Fiat Group. The following year, GAC Fiat took advantage of the trend to localize the Jeep brand and changed its name to GAC Fiat Chrysler.
This opportunity for Jeep falls into the golden development cycle of China’s SUVs. The price of the first domestically produced model, the Liberty Light, has dropped by about 40% compared to the imported version, greatly narrowing the distance between it and the public. Less than a year after its launch, sales exceeded 10,000 units.
In 2016, the cumulative sales of the GAC FCA Jeep brand exceeded 120,000 vehicles; in 2017, the annual sales reached a new level, reaching 200,000 vehicles.
But it only lasted three years. In 2018, the Jeep brand was named by the "CCTV 315 Party" due to the problem of "burning oil", and it has been on a steep decline since then. From 2018 to 2021, GAC FCA's sales were 125,200 vehicles, 73,900 vehicles, 40,500 vehicles, and 20,100 vehicles respectively.
The reasons for Jeep's success and failure can be found in history. Success lies in seizing historical opportunities and gaining dividends by lowering its figure through domestic production. The failure lies in the slow pace of product updates, superimposed quality crises, and inability to keep up with the fast pace of the times.
This can’t help but make people wonder about the future of Jeep. When it is imported, the price advantage is lost and the brand image needs to be reshaped. Is it selling faith based on off-road feelings? Or do you rely on current price cuts and discounts to increase sales?
Obviously, the answer is no.
In the past two years, independent brands have been exploringIn the off-road vehicle market, tanks are taking their first taste of Internet celebrity. Dongfeng Warrior and BYD's upcoming off-road brands have successively taken over the baton. As there are more and more participants in this niche market segment, there is even less room for Jeep to display.
Of course, Jeep also has a third opportunity in China, namely electrification.
Although Jeep is not one of the first electrification promoters in foreign countries, it is also developing electrified models under today's electrification wave. Three pure electric models, Jeep Recon, Jeep Avenger, and Jeep Wagoneer S, are in the final stages of development. , will meet consumers in North America and Europe as soon as next year.
However, according to Jeep's past product promotion rhythm in China, the advancement of electrification will not come too fast. Looking back on GAC FCA over the years, there is only one domestically produced electrified model, Commander PHEV, with a pure electric range of only 70km (NEDC operating conditions).
Jeep is undeniably the originator of hard-core off-roading, but times have changed and its influence is no longer what it used to be. According to statistics on the number of insured vehicles in September, the number of Jeep (imported) vehicles was 1,060, including 572 Grand Cherokee vehicles, a year-on-year decrease of 35.15%; and 488 Wrangler vehicles, a year-on-year decrease of 22.04%.
On the one hand, it is the upward breakthrough impact of independent brands. On the other hand, the brand influence has dropped sharply. In addition, major environmental factors such as exchange rates, trade frictions, and the impact of the epidemic on transportation have added more unknowns to Jeep, which relies on imports.
JeepThe road to comeback is long and long.
Write at the end
There are many brands with similar fates to GAC FCA, such as Changan Suzuki, Dongfeng Renault, FAW Mazda, etc., so that we were not shocked to see the news of GAC FCA's bankruptcy, or even no waves at all.
Most of these joint venture brands have an indelible mark on the hearts of the people, but they have been washed away by the torrent of the times. The remaining positions are reserved for brands that truly understand consumers and adapt to the development of the times.
Data from the Passenger Car Association shows that the cumulative share of independent brands from January to September reached 47.0%, a year-on-year increase of 2.7%. Independent brands rely on high-end, new energy, and intelligence to encroach on the living space of joint venture brands and purely foreign-owned brands.
With one thing going down and the other going down, Jeep has a long road to comeback, as do other joint venture brands and purely foreign brands lingering in the third and fourth tiers.
Editor: Zeng Huijun