Jeep and Ram priced 20% above the market. The market said no.
Stellantis let the Jeep and Ram premium widen past 20%. U.S. share fell from 10.2% to 8.4%, 2024 net profit fell 70%, and the CEO resigned. Loyalty is real, and so is its ceiling.
Transcript
Jeep and Ram had loyal buyers. In 2022, Stellantis had to decide what that loyalty was worth.
For years, Jeep and Ram priced about 5% above the industry average, mostly because they sold bigger, richer trucks and SUVs. Option one: keep that earned premium. Option two: push it past 20% above the market, and bet that brand loyalty would absorb it.
Stellantis pushed. In the first quarter of 2022, Jeep's average transaction price jumped 29% year over year, to over $50,000. Ram's reached $59,678. Ram's chief executive said, "We're able to command strong pricing right now."
Buyers said no. Stellantis' U.S. market share fell from 10.2% in the first half of 2023 to 8.4% in the first half of 2024. Full-year 2024 U.S. sales fell about 15%.
Stellantis' net profit for 2024 fell 70%. On December 1, 2024, the board accepted chief executive Carlos Tavares's resignation, with immediate effect. By the end of 2024, prices had narrowed back toward the market average.
Loyalty is real, but it has a ceiling, and you find it by testing in small steps, not by jumping. Discontinued models hurt Stellantis too, but price was the part that was a choice.
The records behind this video
Every figure in the video comes from this Decision Record, each with its sources.
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