Jeep India recently made a significant decision to discontinue the petrol variants of their popular Compass SUV. This move comes as a result of the 1.4-litre turbo-petrol engine not meeting the stringent BS6 Phase 2 emissions norms that came into effect in April 2023. Jeep had already phased out the manual petrol variants in December 2022, and now they have taken the automatic petrol variants off the showroom floors as well.
As a consequence, the Compass will continue to be available only with a diesel engine, leaving Jeep with no petrol-engined model in the lower end of their vehicle lineup. This decision raises questions about the reasons behind the discontinuation and its potential impact on Jeep’s market position in India.
Reasons for Discontinuation
1. Incompatibility with BS6 Phase 2 Emissions Norms: The 1.4-litre turbo-petrol engine used in the Jeep Compass did not meet the latest BS6 Phase 2 emissions norms implemented in India from April 2023. The engine had already been phased out in other markets due to stricter emissions regulations.
2. Lack of Viable Business Case: The petrol variants of the Compass accounted for 50-60 percent of sales in India, with higher percentages in certain metro cities. However, with average monthly sales of around 650 units, the demand for petrol variants was limited to 350-400 units per month. This made it economically unviable to introduce a new engine for such low volumes.
3. Reduced Export Volumes: The facelifted Compass model led to the production of right-hand drive versions in Italy for export markets, reducing India’s share of export volumes. This further diminished the economies of scale required to localize and manufacture a new 1.3-litre engine in India.
Poor Product Planning and Future Possibilities
1. Missed Opportunity for Timely Action: Jeep could have addressed the issue earlier by planning for the introduction of a new engine. However, without active investment in market-specific product development, there was no viable business case for launching a new engine.
2. Possibility of Petrol Engine Comeback: The next-generation Compass model expected in 2026 may reintroduce a petrol engine, alongside a potential all-electric version.
Discontinuation of Compass Trailhawk Variant
The top-spec Trailhawk variant of the Compass, equipped with a 2.0-litre diesel engine and 4×4 drivetrain, has also been discontinued. While some dealers might still have limited unsold stock, the model has been delisted from the Jeep India website.
Impact on Jeep India
1. Reliance on Diesel: With the discontinuation of petrol variants, Jeep India’s Compass and Meridian models will solely rely on diesel engines. This leaves them vulnerable in the mass-market segment, which is shifting away from diesel-powered vehicles.
2. Potential Volume Drop: Since petrol variants constituted a majority of Compass sales, the overall volumes for Jeep India could witness a significant decline.
3. Challenging Timing for Meridian: The withdrawal of the petrol engine comes at an unfavorable time, as the Meridian model has not gained traction as expected.
Jeep India’s Statement
Jeep India emphasizes the continued demand for diesel powertrains in the premium SUV segment. They will invest in developing efficient 2.0 L MultiJet Turbo Diesel powertrains that offer superior torque, lower emissions, and impressive fuel efficiency.
Jeep India remains committed to the market and has significant product plans for the future. They will explore engine and fuel options based on evolving market preferences to provide relevant choices to consumers.