Jeep Compass gets set for passage to India

When the first Jeep Compass rolled out of the Ranjangaon plant assembly line last week, it must have been a proud moment for the team that had worked relentlessly around the clock to make this happen.

And as Chief Executive Officer of Fiat India Automobiles, the Tata Motors and Fiat Chrysler Automobiles joint venture, Gurpratap Boparai would have been extra pleased. “As a manufacturing facility, we are right there with other plants on efficiency and quality, he said in an interview. “We are one of the unique automobile facilities, which also has a full fledged powertrain unit in a single complex.”

The Ranjangaon plant now has a special place on the Fiat Chrysler Automobiles (FCA) map worldwide since it will be the sole manufacturing hub for all right-hand-drive markets of the Compass. No wonder then that Kevin Flynn, President & Managing Director of FCA India Automobiles, is delighted to bits.

Not only is the Compass going to be significant for his company in this part of the world but, as he confidently declares, it is also “probably going to be the highest quality product exported from India, period”. Boparai agrees wholeheartedly. “Nobody has the vehicle in this class exported from India,” he says.

The reasoning is straightforward. The Compass is a global vehicle, which will be exported to all right-hand-drive markets right from the UK and South Africa to Japan and Australia. To that extent, it does not follow the general paradigm of a low-cost car shipped out from India. “This is a premium brand being made at one of the best plants of FCA globally,” says Boparai.

Flynn believes that the fact that Ranjangaon will be part of a global development initiative is testimony to the evolution of its manufacturing capabilities. “We are incredibly proud and honoured to be given the trust,” he says. “It is a massive accolade for India that a global brand like Jeep has chosen it as a manufacturing hub for exports to advanced markets.”

Developing an all-new product that did not exist elsewhere was also a challenge. As Boparai explains, it is easier to work on a vehicle that is already present as there is a ready reference point. Not so with the Compass. “It was a tremendous effort by all the people who worked together and a tribute to our suppliers too,” he adds.

Flynn is confident that the Compass will do well when it debuts in India in the coming weeks. For one thing, it will be part of the SUV space that is doing roaring business with young buyers queuing up in showrooms. “The substance of the Compass is unmatched and it has a level of competence and gravitas that I do not find in other products,” he says.

The challenge on hand is to reach out to customers aggressively and this is where the retail drive becomes critical. Fiat has not quite made a mark in India over the last two decades of operations when the gates were thrown open to multinational automakers. However, this time around, it is the Jeep brand that has been positioned to make a new beginning.

“The Compass will allow us to move to another level,” says Flynn. He bursts out laughing when asked if it is going to be a do-or-die product for FCA India. “It is a do and there is no die about it,” he exclaims while Boparai chips in, “There is no question of dying and we are positive about India. We have had difficulties over the years but are well positioned now.”

FCA had made substantial investments for the Compass and the business plan envisages a healthy mix of exports and domestic sales to keep the cash registers ringing. In addition, this will constantly ensure production even if there is some kind of cyclicality in some markets. A downturn in South Africa, for instance, can be offset by buoyant business in Australia or India.

“This is a project that can stack up for us and can be a real turnaround for the organisation,” says Flynn. “There are multiple responsibilities that come with this product. One is to ensure that it is a tremendous success here in India and also ensure that we export right-hand-drives to top quality markets.”

The huge levels of trust and cooperation coming in from colleagues around the world has been more than welcome too and the fact that India is just among four global hubs is not lost on anybody (the others being Brazil, China and Mexico). This is especially heartening news at a time when Fiat has had a rough run in the domestic market and is now hopeful of a turnaround with the Compass as the first part of the journey.

It will also be interesting to see if FCA will farm out more responsibilities to India in the coming months. For the moment, the focus is only on right-hand-drive exports but there is no telling why this should not include left-hand-drives too in the near future. After all, India has a competitive costing base coupled with top-class manufacturing capabilities.

As a business plan, the Compass is pretty well set in terms of financial viability. From its manufacturer’s standpoint, it is important that the product makes the right connect with Indian customers too. This is where pricing becomes critical since the value-for-money quotient becomes all-important in this market.

FCA India will be hoping that everything works according to plan in terms of building up market share. In its earlier avatar as Fiat, it delivered products such as the Uno and Palio that caught the fancy of customers but lost their way subsequently. The Compass will now leverage the Jeep’s brand and its mass popularity worldwide while wooing a new set of Indian customers who will hopefully be ready to take the plunge.

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