Driving the news: Stellantis $STLA ( ▲ 4.93% ) unveiled the redesigned 2026 Jeep Cherokee after a nearly three-year hiatus, bringing back the SUV as a larger, hybrid-powered vehicle to compete in the crucial compact SUV segment dominated by Toyota's RAV4 and Honda's CR-V.
For context: The Cherokee returns later this year with Stellantis' first North American hybrid system—a 1.6-liter turbo-four that delivers 210 horsepower, 37 mpg combined, and over 500 miles of range.
Starting at $36,995, the new Cherokee is about $3,000 more than a base RAV4 hybrid but $4,800 less than Toyota's larger Highlander.
Production will take place at Stellantis' Mexico plant, meaning the vehicle will face tariffs on its non-U.S. content despite the engine being built in Michigan.
Why it matters: The Cherokee's return is critical for new CEO Antonio Filosa's turnaround plan as Jeep has suffered six straight years of declining U.S. SUV sales, with market share falling from 13% in 2015 to just 5.9% in 2024. The compact SUV segment represents about 3 million annual sales that Jeep has been missing out on entirely.
Bottom line: Stellantis is gambling that hybrid technology and nostalgic design can overcome years of lost momentum, but they're entering a segment where competitors have already been growing market share.
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