Jeep’s Big Aussie comeback plan. Will it work?

ByDean MellorAugust 7, 2020
7 MINUTE READ
Jeep’s Big Aussie comeback plan. Will it work?

FCA Australia boss outlines Jeep’s Aussie comeback plan in one-on-one talk with Unsealed 4X4.

Recently arrived FCA Australia MD and CEO Kevin Flynn takes some time out to speak with Unsealed 4X4 to outline Jeep’s Aussie comeback plan… a plan that’s aimed at fixing the marque’s damaged reputation in Australia.

At the start of my one-on-one interview with Kevin Flynn, he told me he firmly believes that all of the DNA of the original Willys is baked into every Jeep built today. He should know, because although he’s only been at the helm of Jeep in Australia for around a year, prior to that he was President & Managing Director of FCA in India for almost five years, where he was charged with launching the Jeep brand and managing right-hand drive production of the Jeep Compass, as well as establishing an export strategy for Jeep brand right-hand markets, including parts distribution.

Fca Australia Kevinflynn

Kevin Flynn has a plan to revive the reputation of the Jeep brand in Australia.

 

How will Jeep fix its image?

There’s no doubt the Jeep brand has problems in Australia, with horror stories over the past 10 years or more regarding reliability, high service costs and poor customer care. But Jeep has been working hard to turn this around, and is now putting a fair bit of effort in to explaining how it’s doing this in the Aussie market, clearly outlining the plan and the commitment on the Jeep website, which includes a five-year/100,000km warranty, capped price servicing, lifetime roadside assist, cheaper spare parts, more tech support and more emphasis on customer care.

“I’ve been here nearly a year and prior to coming here the business had experienced a decline for quite a number of years,” Flynn says, “and part of my appointment as a job is to find out what is the cause of that and, more importantly, what is the turnaround plan?”

Flynn explains that part of the problem was as Jeep vehicle sales increased in Australia, the level of customer care and the infrastructure behind that did not keep pace. In response to this problem, Flynn says Jeep is putting a lot of focus into after-sales and processes within after-sales, to reduce the response times to clients and owners when there’s an issue.

“One of the things I committed to do was put four ‘flying doctors’ (special technicians) out into the field… so that whenever we need to get to a situation we’ve now got people around the country mobilised to do it, and that’s their sole job… to respond to a need and to support dealers when they need assistance in diagnosing or sorting or whatever.

“We changed the whole processes within customer service so now there is a lot better link up with technical, customer service, parts acquisition, the whole thing is now really streamlined and cross-functional. It’s working so much better.”

Cherokee145

Cherokee sales are down 29.3 per cent compared to last year.

As for parts and servicing costs, Jeep has also made significant steps to improve what many customers have considered a big issue.

“We did an evaluation of 17,000 part numbers that we sold last year, and we’ve re-priced those components,” says Flynn, adding, “and we’ve added the fixed-price servicing and lifetime roadside assist, so we’ve done a lot of things that we said we would do.”

“COVID has been a nightmare, but we have not missed one promise that we set out to our dealers and we set out to our global seniors who are absolutely backing us on this turnaround of the business (in Australia).

To get the message across to customers, Jeep Australia is using various channels including social media and television. And that message, according to Flynn, is that the company is hitting the “reset button”.

Through social media, Flynn says the message is essentially: “Look, not all may have been as well in the past, but there’s a big button on the wall and a bit of a reset”, followed by the promise, “It’s alright saying sorry but it’s another thing saying what are we going to do about it? And we started laying out those things.”

 

The future

Kevin Flynn is optimistic about the future of the Jeep brand in Australia, pointing out that the company had a good sales result in June this year and that July was also looking strong. Since our interview last week, we’ve now seen the Federal Chamber of Automotive Industries (FCAI) VFACTS sales figures for July and while some Jeep models have performed well, others have not.

While Compass and Cherokee continue to perform quite poorly in the market (down -46.2 per cent and -29.3 per cent respectively for the first seven months of 2020 compared to the same period last year) one of the brand’s core products, Wrangler, was up 3.2 per cent over the same period.

Wrangler09

Wrangler continues to perform well, off-road and on the sales charts.

And while Jeep’s most popular model, the Grand Cherokee, was up 7.9 per cent in July 2020 compared to July 2019 (261 to 242 sales), in year-to-date terms it was down a worrying -19.5 per cent on last year (1424 to 1768).

The new Gladiator managed a very modest 33 sales in July 2020, and there’s little doubt Jeep would wish it could get its hands on a diesel variant.

Of the effort to claw back some sales momentum, Flynn admits, “It’s a journey. It won’t happen overnight and nor should it; we need to earn it back.”

“Without any shadow of doubt, we dented people’s trust and we need to earn that back and that’s not an overnight thing…”

“What I can say is that the engagement we see is significantly up on last year… and the attitude in our social media sentiment is moving from negative into a balance of neutral and positive…”

 

Grand Cherokee

The Grand Cherokee is by far Jeep’s best-selling model, but it’s the oldest product in the company’s line-up. When asked why the Grand Cherokee continued to perform so well, Flynn responded, “First of all it doesn’t look as old as… like me, it’s ageing well (laughs). It’s still a very competent product, and I think the styling cues that have been changed as we’ve gone through the lifecycle have done well; it looks great on the road and, let’s be honest, it still delivers, it’s got a very, very strong towing capacity and all those things, so it’s got a place in the market and it’s got a level of respect.

“If we can make sure that the confidence levels in us, and our back-up are there, then I still think there’s room for Grand Cherokee to grow.”

Gc Limited26

Grand Cherokee is the oldest model in the Jeep line-up… but the best seller by far.

 

Compass

Jeep Compass sales are in the doldrums in Australia right now, but this is a vehicle Flynn is very enthusiastic about. After all, the Aussie-market Compass is built in India where Flynn used to be the boss. In fact, one of the main reasons Flynn is talking to me right now is to promote the revamped MY20 Jeep Compass range, which scores new safety tech as standard, a larger touchscreen display and several other upgrades. The Compass Trailhawk model is still stamped with a Jeep ‘Trail Rated’ badge, meaning the company regards it as a genuinely capable off-roader.

Following on from his comments earlier about Willys DNA being baked into every Jeep product, Flynn says, “Even Compass… all of the off-road, all of the approach angles, the break-over point, even on the normal Compass, it starts off as a 4×4…”

2020 Jeep® Compass Trailhawk

Right-hand drive Compass is made in India.

“With the Compass, I’m proud of the fact that we got such a high level of quality, when we went live building the right-hand drive vehicles – and there were four plants making the vehicle – and the car that comes from India to Australia is the highest quality off the line; durability is great and the vehicle is good. Now, of course, for the ’20 model year, we’ve packed it with safety equipment, we’ve put the big screens in, the nice interiors, we’ve changed the model line-up… and then of course you’ve got the Trailhawk.

“Even when we launched that vehicle (in 2018)… the off-road capability… was outstanding, and I think there is a substance to that vehicle that you don’t find in other SUVs.”

 

Odd pricing strategy

As our interview time slot came to an end, I managed to squeeze in a couple of more questions regarding what I perceive to be some odd pricing strategies in the Jeep line-up. Why, for example, is the Gladiator Overland almost as expensive as the Gladiator Rubicon, yet the latter gets so much more equipment including its Rock-Trac Active On-Demand 4×4 system, front and rear lockers, front sway bar disconnect, Fox dampers, BFG muddies and more?

“The vehicle, it is not just the sum of its components, but it’s actually a style choice, an application choice,” Flynn says. “We’re doing nicely with Overland but actually the Rubicon is obviously where a lot of people have gone, so the big question is what do you want to do with it? I’m glad I’ve got Overland because otherwise it would be too polarised.

“We’ve got another (model grade) coming; we are launching a Sport S, which is going to be fantastic spec but it’s going to be a great package, so we’ll end up with a nice range, and then people can best choose the application and style they have, so I think that’s the best way to position it, it’s actually more of a style thing, but understanding that the Rubicon is great value.”

Gladiator Nz 139

Is the box on the back of Gladiator and a set of Fox dampers worth $11,500? It’s more complicated than that, according to Flynn.

My final question before we ran out of time is in regards to the Gladiator Rubicon costing $11,500 more than the Wrangler Rubicon, yet both vehicles run essentially the same driveline and spec? Surely the box on the back of the Gladiator and a set of Fox dampers don’t cost $11,500.

“If you only needed to charge for the metal you used, then vehicles would be a lot cheaper,” Flynn says. “You know, R&D, development, testing, durability and… it’s a consistent global pricing strategy and… Wrangler is good value. If you do the comparison even with the States, and the exchange rate and shipping and all the rest of it, Wrangler is very good value in Australia, so that’s probably what drives that. But the vehicle is doing well, it’s got its own niche, it’s a fantastic vehicle to drive…”

Only time will tell if Jeep can fix its damaged reputation in Australia and, if so, how long it will take. But there’s no doubt Kevin Flynn and his team are set to give it a red-hot go.