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Jeep spending heavily on Commander incentives

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Seven months after launch, Jeep spending heavily on Commander incentives

By MARY CONNELLY | AUTOMOTIVE NEWS

AutoWeek | Published 03/27/06, 8:29 am et

DETROIT -- Seven months after the launch of the Commander SUV, Jeep is spending heavily to subsidize sales.

In February, Jeep shelled out an average $5,461 per unit in Commander incentives, according to the Power Information Network.

Jeep's spending on the Commander outpaced by $1,803 per unit the average for the mid-sized SUV category, PIN says. In February, the midsized-SUV segment averaged $3,658, the data say.

"It is definitely a warning signal," says Tom Libby, PIN analyst.

"They are trying to keep inventory turning by lowering the price through incentives," Libby says. "But obviously the vehicle is under pressure already."

The Chrysler group had a 101-day supply of the Commander with 29,900 units on March 1. Commander incentives increased $2,203 from January to February, PIN says. In January, the average per-unit outlay was $3,258, the data say.

Dealer Steven Schmelz, owner of Sea View Chrysler-Jeep in Asbury Park, N.J., applauds the spending on the Commander.

"They didn't launch it real aggressively," Schmelz says. "They lost the focus on the Jeep brand in the fourth quarter. Now, they are back."

Schmelz is in a lease-hungry market. The Commander is leasing for $299 a month for 27 months with $1,999 due at signing, he says. Sales are "starting to do well," Schmelz says.

Incentives are 'on par'

Michael Berube, senior manager of Jeep marketing, defends the Commander's launch and incentive spending.

"We don't see we are spending more than the competitors," he says. "We feel we are on par in the segment."

Dealer transaction information underlying the PIN data may not fully capture subsidized leases and discounted sales to fleets, Berube says.

The PIN data does not include fleet sales, Libby says. The retail transaction data is generated from over 10,000 reporting franchises, he says.

"The incentive data include 13 different types of incentives and includes lease incentives. It is very comprehensive," Libby says.

Commander sales totaled 7,091 units in February and 4,209 in January. Since the Commander's introduction in September, sales total 28,348 units. Chrysler will not disclose a sales target.

The Commander is delivering incremental sales to Jeep, Berube says.

At introduction, Jeep tightly controlled the flow of vehicles to showrooms to monitor quality although some dealers sought more product, he says.

Face-off with Aspen

The Commander soon will face more competition in Chrysler-Jeep showrooms.

The Chrysler Aspen, an SUV based on the Dodge Durango, arrives in the fall. That may give Chrysler-Jeep stores three SUVs in the same general category and price range.

For example, the sticker price of the base Commander 4x4 is $30,235, including shipping. The sticker of the Grand Cherokee Laredo 4x4 is $30,080, including shipping.

Chrysler has not priced the Aspen. The base price of the platform-mate Durango SXT 4x4 is $31,825, including shipping .

Jeep has tried to separate the Commander from the Grand Cherokee by stressing the Commander's seven-passenger seating. But Aspen, too, seats seven.

"It is not a Grand Cherokee and Commander issue," says Steven Lee, general manager of Ed Voyles Chrysler-Jeep in Marietta, Ga. "I thought it was going to be, but it's not.

"Aspen? That we are worried about."

Sales of the Commander are rising on the strength of the spring selling season and incentives, Lee says. The store sold seven units in January and nine units in February, and it expects to do "20-plus" in March, he says.

Distinct styling

Dealer Jim Corwin, owner of Corwin Chrysler-Jeep in Hickory, Pa., says, "Our experience so far is that they are pretty divergent markets. It is two really different looks.

"People love one and don't love the other," he says.

"They are so different in looks. The Grand Cherokee is more modern. The Commander skews toward the old Cherokee buyers."

The Commander's cannibalization of Grand Cherokee sales is "significantly less" than Jeep anticipated, Jeep's Berube says.

The Aspen buyer will seek people-carrying or cargo-hauling capability, not off-road prowess, he says. In contrast, 75 percent of the Commanders sold are 4x4 units, Berube says.

Also, he says, the Aspen looks like a Chrysler, not a Jeep, and will appeal to a separate buyer.

Link: http://www.autoweek.com/apps/pbcs.dll/arti...E/60326003/1041

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Maybe if Jeep bothered to stretch the wheelbase from the Grand Cherokee and not make it as ugly and unnecessary as possible, then maybe this wouldn't be happening right now. The only things really holding Jeep back right now are this, the two front-drive cars (okay, FWD/AWD Compass/Patriot), and the inexcusable utter lack of cargo room in Grand Cherokee, and maybe the fake cloth in the Liberty.

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Don't some Libertys have cloth?

Anyways, the problem with the Commander is that it looks like an old Cherokee (could be considered good by some), the interior is no better than average, and the only acceptable engine is the HEMI. That, and the Tahoe/Yukon are much more appealing to anyone who doesn't want to go off-roading.

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The Chrysler group had a 101-day supply of the Commander with 29,900 units on March

I'm betting that the vast majority of those unwanted SUVs are equipped with the lame 3.7L. V6 and the 4.7L. V8, which, while a good performer, has been totally overshadowed by the HEMI.

I had a feeling right from the beginning that the Commander was going to bomb, but, so as not to enrage the resident Pentastar fans, I'll leave it at that.

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Whether it's only the incentives, or the vehicle catching on, the Commander is selling:

Jeep® brand sales of 39,618 units were 11 percent better than February 2005 sales of 35,756 units. Sales of the Jeep brand were helped by the enthusiastic reception of the Jeep Commander, which posted sales of 7,091 units. February results for the Jeep Commander were 68 percent higher than January 2006 results of 4,209 units and set a new sales record for the vehicle and confirming consumers' desire for a seven-passenger Jeep vehicle.

The Commander has sold 11,300 units in the first two months of the year. I'm sure Jeep can deal with that, since it's made on the same line as the Grand Cherokee.

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Whether it's only the incentives, or the vehicle catching on, the Commander is selling:

The Commander has sold 11,300 units in the first two months of the year.  I'm sure Jeep can deal with that, since it's made on the same line as the Grand Cherokee.

Yeah, but with an average $5,461 per unit in incentives, what will they do for the second year?

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I just don't see what this vehicle offers that a JGC doesn't besides a third row. Is a third row that important?

An observation - many Commanders I've seen lately are rentals.

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I just don't see what this vehicle offers that a JGC doesn't besides a third row. Is a third row that important?

An observation - many Commanders I've seen lately are rentals.

Uhhh.....if you don't see how the Commander having a 3rd row makes it completely different than a GC....for someone that NEEDS a 3rd row. Then I don't think I can help you. That's what it is.....a GC with a 3rd row, and squared off styling. However, it's 3rd row is just for kids.

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Anyone remember the full-size Jeep Commander concept from about 5 years ago? From what I remember, it was pretty hot and upmarket. Much more of a Jeep flagship product.

If DCX wanted to save development costs, I think they would have been more successful building the big Jeep off of the Durango chassis with styling from the origional concept.

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wow, i saw a BRAND SPANKING new black Commander on the way home tonight. The side rub strips were stainless or chrome and the running boards had chrome accents. the rear grab rails did too.

I had to clean myself. I had moistened myself it was so good.

Imagine, a Chrysler I like.

that said, the interior plastic is cheap, the gas mileage sucks, the third row is useless. But I love it in all its boxiness (especially in black) for the same reasons you always love Jeeps and rides like the Land Rover LR3. Its true to the brand.

Jeep has to sell the snot out of this thing, but cmon, make the interior nicer. The domestic brands cannot pull their beancounter heads out of THEIR FAT LATE FORTY SOMETHING BALD HEADED CHEAP ASSES long enough to realize that vehicles like this cost serious coin and people EXPECT hospitable interiors and real performance for the buck. Also, people are wise to anyone who puts out stupid designs and the tight third row is just a bit too tight to be taken seriously. I tend to think of the third row as just for kids, but most American idiots will never think of it on that level. I think of it as a Jeep with a nice big cargo area.

Another fault, maybe the MSRP IS TOO HIGH. Prbably on purpose, like GM. Speculate with an absurdly high MSRP and then back off with BIG DISCOUNTS to bring in the cheaper folks later to save the day. (like me).

Memo to the buttholes in charge of the US brand car companies....SPEND A LITTLE FRIKKIN MONEY on interiors and maybe you wouldn't be stuck with all this iron rotting on your lots.

What the commander really needs is a nice simple inline 6 like the trailblazers, with some serious grunt.

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Memo to the buttholes in charge of the US brand car companies....SPEND A LITTLE FRIKKIN MONEY on interiors and maybe you wouldn't be stuck with all this iron rotting on your lots.

Your wish, is DCX's command. They are introducting an "Overland Edition" that will have an upgraded interior.

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Has anyone been in the third-row seat? It is absolutely useless-and the second row is hardly any better. Being only 5.4', I had like no headroom in the third row, and the legroom was smaller than that of a Lexus SC430, if that means anything at all. And the Commander is still a mid-size SUV, not a large one.

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Your wish, is DCX's command.  They are introducting an "Overland Edition" that will have an upgraded interior.

I WOULD LIKE A NEW DASH WITH DECENT PLASTIC TOO. see land rover LR3 for more info.

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The 3rd row seat is indeed useless - unless you like to sit yoga-style. There's literally no legroom. They should offer a stripped Commander without the third row seat - less cost, less weight. Now THAT will appeal to the old-style Cherokee buyers - the looks are great and, as noted above, true to the brand.

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My question is; why have so much redundancy with the Commander and GC anyway???

DCX needs to polish up the Commander a bit, jack the price, pitt it against Hummer and call it a flagship.

Of course, that might not fit into their projected sales numbers too well.

I just think it would be ideal to have the new Jeep become sort of a BI-POLAR entity with the introduction of the Compass... Why not market it, the Liberty and the GC as their volume driven everyman products and why not market the Wrangler, Patriot (Maybe) and Commander as the HERITAGE driven OFF ROADER products that are as rugged as a Hummer, yet not quite as pricey.

I think there has been SO MUCH opportunity squandered with Jeep. The name and the reputation has SO much equity that DCX is JUST beginning to tap into. I think they should offer Jeep Trucks as well kinda like the old Golden Eagles and Commanches. Just limit the volume so as not to cannabalize Dodge.

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But you didn't say if you wanted the LR3's additional $10K-$15K .

the commander is 40k, and its plastics are not nice enough for a 40k vehicle. just like the 300.

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Uhhh.....if you don't see how the Commander having a 3rd row makes it completely different than a GC....for someone that NEEDS a 3rd row.  Then I don't think I can help you.  That's what it is.....a GC with a 3rd row, and squared off styling.  However, it's 3rd row is just for kids.

I just don't see what this vehicle offers that a JGC doesn't besides a third row. Is a third row that important?

:blink:

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I think there has been SO MUCH opportunity squandered with Jeep.

Werd! IMO, the Commander should have come out 5 years ago. Jeep spent too much time debating about wether they should build a Soccer Mom SUV or keep their rugged reputation that they totally missed the SUV boat. Plus, when they finally did decide to build the Commander, they did it pretty half-assed. Not only did it come at the wrong time, but it's the wrong car, too.

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the commander is 40k, and its plastics are not nice enough for a 40k vehicle.  just like the 300.

The Liberty's plastics are better than Commander's.....so BrewSwillis' arguments above don't stick.....

Jeep's doing better with cheaper......

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The Liberty's plastics are better than Commander's.....so BrewSwillis' arguments above don't stick.....

Jeep's doing better with cheaper......

the EXPLORER has better plastics......

i do like the commander's seat cloth

interesting, according to carsdirect, i can get a v6 LR3 for 36 thousand....add leather and some other stuff, still under 40, the third row package with leather finally kicks it up over 40 grand.......The LR3 is AWESOME. the commander seems roughly just a couple thou below the LR3 only...I go for the space and comfort of the Lr3......

by the way, Jeep is offering a really cheap lease on the commander right now. i just saw an ad for 279 a month for 24 months but with a lot down.....

Edited by regfootball

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