The new Jeep Cherokee is set to lead the transformation of Stellantis sales in the United States

Los Angeles – Stellantis Count on the return of the Jeep Cherokee to help lead the U.S. turnaround for the SUV brand and beleaguered automaker.

Cherokee returns after a three-year hiatus, rejoining the small and medium-sized car markets, which represent the largest sectors in the United States. It also represents Jeep’s first conventional hybrid model and its most fuel-efficient gas-powered vehicle ever in the United States.

“It’s a very important vehicle for us,” Richard Cox, Jeep’s senior vice president of brand operations, told CNBC during a 2026 Cherokee media event. “I think this expands our reach with this level of powertrain, and with this level of efficiency and fuel economy.”

The car is currently arriving at US dealerships, and is arguably the automaker’s most important US launch this year. Stellantis is trying to regain market share after significant losses in recent years.

The automaker has set a target to increase retail sales by nearly 25% in 2026 to 1.15 million vehicles, driven by updated and new models as well as price and product realignments to move vehicles from parts at dealerships.

“It’s a big part of our growth,” Cox said regarding the new Cherokee. “It positions us well in ’26.”

Last year, Jeep narrowly reported its first annual sales increase – an increase of less than 1% – since 2018, when the brand achieved sales of more than 973,200 units. That compares to sales of 593,401 Jeep vehicles in 2025, a 39% decline over the seven-year period.

Jeep’s 1% annual sales growth wasn’t enough to lift total U.S. Stellantis sales into the black for the year. The parent company reported a 3% decline in U.S. sales in 2025 — marking its seventh straight decline amid a failed push toward all-electric vehicles and significant cost cuts and price hikes under former CEO Carlos Tavares.

Sean Hogan, a Los Angeles-area dealer who leads the Stellantis National Franchise Dealer Council, believes a targeted 25% increase in U.S. sales can be achieved with the company’s new leadership and product portfolio.

“We missed the Cherokee,” said Hogan, vice president of Sierra Automotive Group. “It’s huge for us. It’s huge for Jeep, and I think they nailed it.” “It’s key for us to get the machine going again to start the volume flowing again and generating capacity at our dealerships. It’s bringing in new customers.”

Jeep believes it has a winner with the Cherokee, even more so than the last generation of the vehicle which peaked at nearly 240,000 units sold in 2018.

The company declined to discuss production expectations, but it likely will not be able to achieve similar sales numbers until the company adds US production capabilities. Plans to expand production at the Illinois plant are expected early next year.

The Cherokee is currently only produced at a plant in Toluca, Mexico, which also makes the Jeep Compass SUV and the smaller Jeep Wagoneer S EV, and is scheduled to produce the upcoming Jeep Recon EV in the second quarter.

Stellantis’ Toluca plant is estimated to have the capacity to produce 303,000 vehicles annually, according to AutoForecast Solutions.

The automotive intelligence and forecasting company expects Jeep’s U.S. sales this year to increase about 10% to 650,000 units, led by Cherokee, according to Sam Fiorani, AFS vice president of global forecasting.

Jeep CEO Bob Bruderdorff told CNBC in December that Cherokee is a priority for the brand amid slowing electric vehicle sales.

“Once we finish the Cherokee and get a good run rate, we can start the reconnaissance process,” he said. “Recon, I’m in no rush. I want to get the quality right for the Cherokee, and then once we’re confident, well, turn on the Recon.”

Broderdorf has been leading Jeep’s turnaround strategy since being named CEO in February. These efforts included significantly reducing prices and model complexity and moving away from the brand’s all-electric plans as part of a broader withdrawal by Stellantis that will cost the company $26 billion.

The 2026 Cherokee is a conventional hybrid — a technology pioneered by the Toyota Prius — that doesn’t require a plug, but uses a small battery and electric motors to help with fuel economy.

Jeep has historically been known for large gas-guzzling SUVs, but the Cherokee is expected to achieve 37 miles per gallon, including 35 mpg highway and 39 mpg city.

“These are very competitive numbers,” said Mike Cockell, Jeep Cherokee plate manager. “It’s a vehicle that has to do everything for the customer, and we feel like we can do it all. It’s like a Swiss Army knife.”

The updates are an attempt to make the car more competitive against brands like Toyota as well as to capitalize on the expected growth in hybrid cars.

“Electrification trends are fairly steady. Hybrid trends are absolutely growing,” Cox said. “So, I think it was a big step in the right direction.”

The Cherokee features a 1.6-liter turbocharged four-cylinder hybrid engine rated at 210 horsepower and 230 pound-feet of torque. It features standard all-wheel drive, relatively large interior screens, and 140 standard and available safety and security features.

The starting price for a Cherokee ranges from about $37,000 to $46,000, according to Stellantis. The best-selling model is expected to be the $39,995 Cherokee Laredo, which Stellantis says is expected to account for 36% of vehicle sales.

Pricing positions the midsize car to be competitive in its own class as well as against compact SUVs such as Toyota Rav 4f Honda CR-V.

Jeep officials say those two brands served as benchmarks for the updated Cherokee.

“We have a number of customers who either defected or moved on to something else because we didn’t have a product offering for them. So, this is our opportunity to bring them back into the family, and I think we have to make some inroads as well,” Cox said.