Big Discounts Could Mean Big Trouble for Midsize Jeep Gladiator
Jeep dealers are now discounting Gladiator models by as much as $9,000, indicating demand for the Wangler-based pickup has seriously cooled off. Considering the insane markups we saw at launch, that’s not much of an insult.
Now that Fiat Chrysler only reports sales on a quarterly basis — an obnoxious trend sweeping through the industry like a plague — we don’t know how many Gladiators leave dealer lots month-to-month. It looks like the pickup averaged a hair above 5,000 U.S. deliveries every thirty days in 2019. That’s a far cry from the midsize pickup segment leaders, but it was also the first year of Gladiator production.
With oodles of character, legitimate off-road capabilities and higher-than-average pricing, it’s also a bit of an odd duck. While interesting designs can occasionally be too much for a (sometimes large) subset of shoppers, pricing can make or break a car’s sales prowess. Some are of the mind that Jeep expected too much from consumers and that these lofty discounts are proof.
Automotive News recently framed the Gladiator as its own worst enemy. The base model starts at $35,040 (including delivery fees) whereas the brunt of its segment rivals can be had for about ten grand less. Dealer incentive bulletins from January indicated that Jeep was cool slashing $2,000 off 2020 Gladiators while other manufacturers offered similar (sometimes higher) incentives on their midsize pickups. However, a mashup of dealer discounts and a new rebate has resulted in Gladiator deals getting much sweeter in some areas.
From Automotive News:
Some dealerships already are offering discounts of up to $9,000 on the Gladiator less than a year after its release, according to shopping site CarsDirect. In a dealer bulletin obtained by Automotive News, FCA offered support starting in mid-January in the form of $2,000 bonus cash on all but the Rubicon trim. Jeep’s website listed a $2,000 sweetener available in certain regions through March 2.
Some dealers say Gladiator sales have slowed after a blazing start that saw early adopters scooping up higher-end trims. But they aren’t ready to panic yet.
Some dealers say the pickup is selling about the same as the Wrangler. Others complain that demand has cooled and worry the Gladiator is cannibalizing Wrangler volume. The big picture doesn’t reflect this; Wrangler volume was down an almost negligible amount in 2019, with Gladiator scooping up about four times the volume lost in sales — resulting in 40,037 U.S. deliveries.
Considering Ford’s Ranger saw over twice that volume, and with Chevy’s Colorado doing better than that, it would seem that FCA made a mistake. Yet direct comparisons aren’t easy to make. With a starting MSRP of $35k, Jeep makes quite a bit of cash on every Gladiator sold — and it would have known this before it hit the market. Dealers report customers eager to add options and climb trim levels, which isn’t abnormal for a brand new model. Jeep also has an excellent list of aftermarket parts and a consumer base that’s happy to take advantage of it.
That’s not to say the Gladiator is better or so totally different that the inflated sticker price can be completely rationalized. Pretty much every offering in the midsize truck segment does the job with its own unique flavor. Jeep’s just happens to be the most piquant and off-road focused. FCA knows that people might be inclined to spend more on something a little unique and likely isn’t as worried about pickup volume as it is about profitability.
The Gladiator is still overpriced for your typical midsize pickup shopper (where the Colorado awaits), but those discounts are here to help. Jeep just needs to be careful to maintain balance while retaining some amount of hype. Revisiting the model’s sales performance halfway through 2020 should equip us with a better sense of the the truck’s wellbeing.