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More Layoffs at Jeep Cherokee Plant as Sales Plummet—and Where’s the New One?

The smaller Cherokee’s future is not looking so bright amid tanking sales and factory layoffs.

Justin Westbrook for Motor Trend >
Mar 31, 2022

The now nine-year-old Jeep Cherokee is going through a rough patch, as sales of the mid-size crossover dropped dramatically last year, with demand dwindling, industry supply shortages—and now more factory layoffs at the plant where the Cherokee is produced in Illinois have been announced.

This version of the Jeep Cherokee was introduced in 2013 (for the 2014 model year) as the replacement for the old Jeep Liberty; it is smaller than the Grand Cherokee. Most cars enjoy about a six-to-ten-year-long shelf life before they get a major overhaul or are replaced by something else, and as the Cherokee is nearing that point it its own lifecycle, we are sort of surprised to see layoffs instead of, say, an updated model.

Automotive News reports Stellantis, the parent company of Jeep which owns the Belvidere Assembly Plant in Illinois where the Cherokee is put together, has plans to lay off an unknown number of workers this May. A spokesperson confirmed the layoffs to Auto News, saying: “The reductions will be achieved through a combination of retirement packages offered to eligible UAW-represented employees as well as layoffs of both hourly and salaried staff.”

Auto News also reports the Belvidere plant faced 400 layoffs just last November, cutting the second shift, and 98 more employees were laid off from the Sterling Stamping Plant in Detroit this week, as well. Stellantis claimed the cuts are necessary to operate in a “sustainable manner” going forward.

With such dramatic cuts to the assembly plant, and reports that future electrified muscle car assembly will be taking over the Belvidere Assembly location in a couple of years (according to AutoForecast via Auto News), we have to wonder where the previously-announced (in a product roadmap) replacement for the current Cherokee is? If the next-gen Cherokee was coming soon, layoffs wouldn’t be expected, unless it had to move assembly plants for some reason.

Sales of the model have slipped a whopping 34.4 percent year-over-year in 2021, down to just over 89,000 units moved from a high of 239,437 Cherokees sold in 2018. Now might be a good time to show something, and even better if Jeep can get it into showrooms. This year’s Cherokee jumped up in price, and limited its trim options.

While demand is certainly diminishing rapidly, other factors could be playing into the present demise of the Cherokee, including industry supply shortages that have limited some parts availability. Components may be prioritized in higher-MSRP model lineups that offer more return for the automaker, so the cheaper Cherokee is less of a production priority until supply shortages relax. It’s also possible the new Cherokee could face production delays due to shortages. Regardless, the Cherokee is going to need some sort of major shakeup soon if it’s going to reverse its tanking sales trend.

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