Jeep Woos Luxe Buyers with Upscale Rebirth of Grand Wagoneer

(Bloomberg) -- Fiat Chrysler Automobiles NV is expanding its prized Jeep brand into the high-margin three-row SUV segment and showcasing its electrification strategy with a plug-in hybrid concept of the Jeep Grand Wagoneer.

The Italian-American automaker said Thursday it’s bringing back the nameplate of the Wagoneer, a boxy station wagon retired in the 1990s, as a sleeker and more upscale sport-utility vehicle that can compete against rivals such as General Motors Co.’s GMC Yukon and Cadillac Escalade.

Fiat Chrysler also is playing catch up by adding a plug-in electric version of its iconic Jeep Wrangler SUV, which the company said will offer drivers 50 miles to the gallon and 25 miles of pure-electric range when it starts showing up in dealerships later this year.

While Fiat Chrysler helped define the SUV segment with the off-roading Wrangler, it has been absent from the market for the largest-size and highly-lucrative SUVs with three rows of seats. That will end once the company starts production of gas-powered Wagoneer and Grand Wagoneers at its Warren, Michigan, plant next year, giving it a family of contenders in the battle for the biggest sport-utility vehicles.

“It’s a clear departure from Jeep; it’s a premium extension of Jeep,” Christian Meunier, global head of the brand, said in an interview. “It’s pushing the limit of what a flagship for the company could be.”

Meunier said the Grand Wagoneer took its inspiration from ultra-luxury cars like Rolls Royce and Bentley, but his volume aspirations are closer to GM’s.

Fiat Chrysler will market the Jeep SUV and its sibling, the Wagoneer, in North America and the Middle East, aiding its goal of selling two million Jeeps globally by 2022 -- a step down from the more-ambitious target of about 2.8 million set in its 2018 five-year plan.

U.S. sales in the large-SUV segment are expected to almost double in the next four years to more than half a million vehicles, based on data from researcher LMC Automotive.

Average prices for these full-size SUVs have risen 4.9% since January 2017 to $63,865 through June, while the average luxury price climbed 7.5% to $89,914, according to Kelley Blue Book. Fully-loaded versions of the Wagoneer and Grand Wagoneer will top out at around $100,000, a company spokesman said.

The Wagoneer will be built on a new car platform designed for gas, hybrid or electric powertrains and will serve as the luxury benchmark for the brand, with technology such as hands-free driving and a passenger-side screen that eventually may spread to the rest of the lineup, Meunier said.

Design Departure

The automaker dispensed with most of the signature characteristics of the original Wagoneer -- like its wood-paneled exterior -- to give it a refined look more in line with a modern premium SUV, said Ralph Gilles, Fiat’s chief designer.

“It has all that capability underneath the skin, but the wrapper is meant to exude luxury and a certain status,” he said in an interview.

The Grand Wagoneer concept has a plug-in hybrid powertrain, which would put it in the same league as Ford Motor Co.’s Lincoln Aviator plug-in hybrid.

Fiat Chrysler, whose late CEO Sergio Marchionne resisted heavy investment in electric vehicles as a loss-making endeavor, now is electrifying its Jeep lineup as global emissions regulations tighten. It’s introducing a hybrid Jeep Compass and Jeep Renegade in Europe, and the plug-in Wrangler will go on sale in Europe and China in 2021, Meunier said.

The automaker indicated it would build a plug-in version of the Wagoneer for 2022 in its 2018 five-year plan, but it isn’t clear if the plug-in technology showcased in the concept on Thursday will make it into production.

A hybrid Wagoneer would compete against other gas and electric-powered plug-in SUVs such as the Volvo XC90 PHEV and plug-in Mitsubishi Outlander.

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