Ram last year put an end to its 1500 Classic that was the entry level of the range. However, the U.S. automaker that is part of the Stellantis Group is thinking of introducing a cheaper pickup truck to the market to replace the discontinued model by filling a gap that its range has right now that starts at a fairly high price.
Ram thinks about a possible replacement for the 1500 model
Ram, the famous pickup brand of the Stellantis Group, is rather seriously considering re-entering the light commercial vehicle segment with a more affordable model. This strategic move is intended to fill the gap left by the recent discontinuation of the Ram 1500 Classic, which represented the entry-level of the lineup.
Ram’s primary goal is clear: to expand its market share by attracting a broader customer base, particularly those who are looking for a rugged and reliable pickup, but with an eye on the budget. Indeed, Ram’s current offerings are in a relatively high price range, potentially excluding a significant portion of the market.
A return to an affordable pickup could prove to be a winning move for Ram, allowing it to compete more effectively with rivals and strengthen its presence in the light commercial vehicle sector.
Ram CFO confirms brand’s intentions
Chief Financial Officer (CFO) Doug Ostermann confirmed his intention to reintroduce a low-end pickup truck, thus filling the gap left by the recent discontinuation of the Ram 1500 Classic. This decision marks a reversal from the previous policy of Carlos Tavares, former CEO of Stellantis, who had opted for a pickup range geared more toward the premium segment. However, the 16 percent decline in Ram pickup sales in the United States last year prompted the company to reconsider its strategy.
“We need to introduce some sort of low-end setup of the new pickup to fill this gap,” Ostermann said at a Wolfe Research conference. However, he warned that such a model “would not come to market immediately.” Stellantis therefore working to regain market share by adopting a more inclusive strategy of offering affordable pickups to a wider range of customers. In addition to introducing an economical model, the company is also implementing other measures to boost sales, such as cutting prices and offering larger incentives.
Solutions for the U.S. market
Stellantis, is facing increasing political demands in the United States to increase production of its vehicles within the country. This pressure, shared by other manufacturers in the industry, reflects a growing focus on localizing production and reducing dependence on imports.
To address potential new trade tariffs and to ensure supply chain continuity, Stellantis has already taken proactive measures. In particular, the company has expanded component sourcing across the borders of Canada and Mexico, taking advantage of existing free trade agreements.
However, faced with the possibility of further trade restrictions, Stellantis is considering more decisive strategic options. According to Ostermann, one of the company’s spokespersons, in the event of new taxes, Stellantis could consider transferring part of the production of the Ram 1500 (DT) model from Mexico to the Detroit plant.