Jeep in Australia 1978 - 1991 - AUSJEEPOFFROAD.COM Jeep News Australia and New Zealand

Go Back   AUSJEEPOFFROAD.COM Jeep News Australia and New Zealand > JEEP GARAGE > Jeep History in Australia
Register Forums Trading Your Jeep New Garage Mark All Read

Post New Thread  Reply
 
Thread Tools Search this Thread
  #1  
Old 02-02-2011
Jimmyb's Avatar
Jimmyb  Jimmyb is offline
Head Honcho
 
Join Date: Jul 2002
Location: Australia
Posts: 12,760
What Jeep do I drive?: XJ
Likes: 1,060
Liked 1,173 Times in 708 Posts
Check out my Ride(s)
Exclamation Jeep in Australia 1978 - 1991

On March 28 1985, Jeep Australia Pty Limited, a wholly-owned subsidiary of American Motors Corporation, and distributor of Jeep vehicles in Australia, informed its dealers that all importing - and local assembly - of Jeep vehicles would cease.

The announcement stunned many in the dealer network. The four months prior to the notification had been unusually brisk for most dealers, and Jeep Australia posted record deliveries. In the previous year, Jeep Australia had rationalized its range of models, become more aggressive in its advertising, and by sourcing the CJ10 from Mexico, had (at last) a tough-as-guts vehicle that could match Toyota head-on in the 4WD light-truck marketplace.

Many dealers believed the (then) current line-up of vehicles was almost ideal – and many who had struggled with Jeep since the days of the sub-standard 1979 Quadratrac models were now ready to spend the dollars necessary to make their dealerships recognizably ‘Jeep’. So, obviously, some dealers were dismayed by the manner in which Jeep Australia chose to wind down its operation. The dealers were informed only hours before some senior executives were due to leave the company, and only week or so before all State Regional Offices were closed.

To be fair, Jeep Australia probably chose the best course. An earlier public announcement could have caused potential customers to panic and dealers’ orders to be withdrawn, leaving quantities of vehicles unsold. As it happened, by the time word got out to the general press, there were no CJ7 Renegades unsold anywhere in Australia, only a few CJ8s and just thirteen full-sized Cherokee wagons.... hardly enough to cause concern about any public backlash!

American Motors’ subsidiary had established an ‘assembly’ plant in Brisbane suburb of Salisbury in 1978. Initially, all vehicles were imported fully built. However, the Cherokee, unlike the smaller CJ7, was not available in right-hand-drive form. This meant that the wagon had to be partly disassembled and then rebuilt with the steering wheel on the other side. It was a costly exercise, and the time that elapsed from the vehicles’ original manufacture, to when they were sold, was considerable. The delay, plus multiple transportation and multiple storage (and a high rate of physical damage) resulted in many of the early Cherokees being a little worse for wear when the keys were handed over to the first owners – a fact that was reflected in the subsequent warranty claims; many of which were for poor paint adhesion, corrosion, water leaks and faulty electrics.

Slow sales meant that many ‘new’ Jeeps sat, forlornly, in open storage yards. For many months, a shipment of Renegades was stored in a Sydney yard; right beside a busy railroad. Hardly the sort of advertising an automaker craves.

The Jeep legend suffered badly from 1978 to 1981 – partly because of the Cherokee’s sub-standard fit and finish and partly because the CJ7 Renegade was so poorly specified.

In 1978, the Renegade had the potential to open up a whole new section of the market in Australia. It was the only short wheelbase hardtop available with automatic transmission – a big attraction, particularly for female drivers. However, the fact that the sporty-looking Jeep lacked power steering and power brakes meant that it did not appeal to people attracted by Jeep’s ‘lifestyle’ advertising. It would be two years before the CJ7 was available with power-assisted brakes and steering.

In 1981, the Jeep Australia plant began full assembly of the SJ Cherokee wagons and J20 trucks from AMC-supplied CKD kits. This meant the Aussie management could offer fresher, and better-built, stock to the dealers. But the locally-assembled vehicles were still far from perfect. At a dealer meeting, a GM /Jeep dealer stunned two visiting AMC senior executives by standing up and asking, ‘When will Jeep begin supplying life-jackets with every vehicle?’ The execs didn’t know what he was talking about. Then the dealer told them that the Jeeps had so many water leaks, his staff was worried that some of their customers would drown! At the time, some Jeep dealers reckoned JEEP stood for Just Expect Every Problem.

Water leaking through the door and tailgate seals was one of the more-common customer complaints. While the service people at the dealerships conducted frustrating searches for crinkled and/or poorly-fitted seals, the hidden culprit was the poorly-stamped body panels. Time heals everything but body-stamping dies; they just wear down. When Jeep released the full-sized wagon back in 1962, no-one would have predicted that it would stay in production for 28 years. But the declining demand over time meant that it was never economic to consider spending the millions required to make new dies. And it meant that the longer production continued, the worse the sealing problem became. AMC decided to give the old bus the flick once the XJ was released 1984. However, when that happened, there was renewed interest in Jeeps and a good percentage of XJ-prospects decided they preferred the spaciousness of the 1960s design. It was enough to keep the presses busy for another 6 years.

One of the things that really irritated the Jeep dealers was the fact that Jeep Australia did not control its own spare parts distribution. Those rights belonged to Bill Patterson-Cheney (a GM dealership in Melbourne) under an agreement signed years earlier with Jeep Corporation in the USA. Incredible as it may seem, when Jeep Australia was (eventually) able to take control of its own parts, it gave the rights for national distribution to a small, privately-owned company, whose experience was limited to selling aftermarket parts for Mitsubishi cars! The parts availability situation then went from bad to horrific. When urgently needed parts were embargoed on the wharves – awaiting payment for import fees - Jeep Australia eventually realized that it needed to be in control of its own destiny.

In 1984, with the parts situation under control, the future for Jeep in Australia started to look a lot rosier. An ex-Ford man, Jerzy Stanley, had been given the task of improving the production quality. The (now) locally-assembled SJ Cherokee wagons and J20 trucks were almost comparable to their competitors in fit and finish and, with the continual down-sizing of other makes, the SJ Cherokee remained the only four-door, large-capacity V8 wagon on the market. A fact realized by buyers requiring a combination of power, strength and weight to haul a large van or trailer with safety.

The real arrow in Jeep’s quiver was the CJ10 – a truck designed by AM General (the military division of AMC) and a vehicle not sold to the public in North America. The CJ10 was a no-nonsense, super-tough 4WD that made no concessions to styling fads or current-day whims – just the thing that would appeal to farmers, miners and serious off-roaders.

Jeep Australia was also making good ground with the beefy J20 single cab trucks and a locally-designed crew-cab variation that could seat six big adults in comfort and still carry a heavy payload out the back. Both J20 models were popular with government departments and commercial users.

So, when almost everything in the garden was looking good, what went wrong? What caused the world’s most experienced 4WD manufacturer to withdraw from Australia– a market-place that attracts the Japanese 4WD brands like bees to a honey pot, and a market-place with plenty of buyers ready to invest in a four wheel-drive adventure?

The problems were many. Jeep’s plant in Queensland was small compared to that of its direct competitors. Even at full strength, it could only assemble about sixty Cherokee/J20 vehicles a month. Hardly enough to frighten the Japanese who where importing thousands of 4WDs every month. And, certainly not enough to make the profits necessary to impress the accountants back in the USA.

In 1983, the factory next door to Jeep Australia burnt down, taking with it several of JA’s walls, many vehicles and a good portion of the assembly line. It was a setback Jeep could not afford.



Jeep also suffered from poor dealer identification and continuity. With such a small range of vehicles, price structures that (on paper) looked non-competitive, and a not-so-shiny reputation from the 1979 to 1981 period, Jeep was hardly a ‘sort-after’ franchise. This resulted in the JA management signing on almost motor dealer who was prepared to have a go. Jeep thought that more dealers would mean more sales. Sadly, it worked in reverse. Some dealers did not support the make with proper presentation and spare parts back-up. In multi-franchise dealerships, Jeeps were often the poor cousins who lived on the back row. Others went overboard in promoting the name by way of massive discounting. One, with a reputation for bad business ethics, could only contribute a knack for bad publicity.

The Australian operation’s savior was to have been the all-new, down-sized, XJ Cherokee and Wagoneer wagons that were due to be released in North America in late-1983 These compact vehicles were developed in conjunction with Renault (who then controlled AMC) and were, at the time, considered to be quite advanced 4WD wagons.

When they eventually hit the American showrooms in 1984, they sold like hotcakes. And, within a short time, the little Cherokee took home every “4WD of the Year” award in the USA.

Unfortunately for Jeep Australia, and because the XJ had been such an outstanding success (more than 70,000 sold to American buyers in 1984), the parent company virtually ignored requests for a right-hand drive version. AMC couldn’t build more XJs if it tried and, even if it could, extra quantities of the V6 engine, which was sourced from Chevrolet, was not available. Another hiccup would be the cost of developing the RHD version: estimated then at a cool $50million.

Gene Heidemann, Jeep Australia’s positive-thinking CEO (the third American in that post since 1979), realized that even a few hundred XJs a year would be enough to build better awareness of the Jeep range. Gene began negotiations in early 1984 with a view to importing LHD XJs and then converting them to RHD in the Brisbane plant (1979 all over again!) However, in 1984, the Australian government brought in new regulations relating to the importation of 4WDs – regulations designed to stem the flow of passenger car derivative 4WDs such as the extremely popular Subaru Wagon and slower sellers like the Toyota Tercel and the oddball Lada Niva, all of which were really ‘cars’ with the addition of a 4WD mechanism.

The Aussie government decided to allow ‘real’ 4WDs, such as the Toyota Landcruiser, Nissan Patrol, Range Rover, Suzuki Sierra, etc., into the country without a quota restriction and with a comparatively low duty rate of 25%. Passenger car derivatives like Subaru where to be subject to quota and to the passenger car duty rate of 57.5%. For simplification of identification, the ‘real’ 4WDs were deemed to be those with a chassis separate from the body. Those with an integral chassis were considered to be ‘cars’ and therefore subject to the more restrictive regulations.



When the new rules were introduced, they looked clear-cut and beyond question. However, no government rule-maker was aware that just over the horizon was a real 4WD that couldn’t find a place in the regulations. The XJ was definitely not a passenger-car derivative. It was a full-blood 4WD. Yet, because of Jeep’s ingenuity and innovation – building a separate chassis and body, and then welding the two together – the government took the easy way out and deemed it liable for the higher rate of import duty.

Strike one! To import the mid-sized XJ at the highest duty rate, and then incur the cost of conversion would make it totally non-competitive in price.

Despite this massive setback, Gene Heidemann decided to soldier on with the established models – particularly as buyer demand for each appeared to be on the increase. Ironically, the tremendous recovery in the US economy, the resultant increase in the strength of the US dollar and the sales success of Jeep in the American market, were to place too much pressure on the Australian operation. With almost all of the components being supplied directly from the US, the cost per unit was becoming prohibitive.

Jeep Australia’s only possible salvation was the plant in Mexico. Mexico had been supplying all the CJ10 trucks since mid-1984 and could supply RHD Cherokees if required to do so by the parent company.

Strike two! American Motors, through its new French boss said ‘No’. After great initial acceptance in the US, the AMC (Renault) Alliance and Encore vehicles were faring badly. Americans, now with plenty of cheap fuel on tap, were demanding cars with more “zap” than offered by the Renaults. The only chance for Renault was to cut costs and offer their passenger cars at bargain-basement prices. And the only way they could do that was by making better use of the Mexican facility.

If Jeep Australia had been able to prove that it had plenty of runs on the board, perhaps AMC’s French bosses might have adopted a different attitude. They might have even subsidized Jeep Australia until their new plant in China was ready to build export-quality Jeep vehicles and components.

However, like many Australian manufacturers at the time, Jeep suffered regularly from a variety of external stoppages, go-slows and strikes. Even when things were going smoothly, it took much longer to assemble a Jeep in Australia. Then, right at the moment the local plant needed to prove its worth, and was under intense scrutiny of Renault-controlled AMC executives, JA reeled under the effects of a protracted power workers’ dispute. Imagine having to give head office the news that, due to a lack of electricity, no vehicles were completed today!

At the time, Renault was virtually bankrupt and the last thing they needed was a distant subsidiary that was plagued with problems and losing money. So, in early 1985 the decision was made to stop all assembly and importation of vehicles by Jeep Australia.

Only the spare parts operation was to remain, in order to comply with a government regulation and to maintain the vehicles sold.

Jeep Australia had about fifty vehicles in various stages of construction. In true American style, AMC instructed the Australian management to dispose all of the partly-built vehicles by burying, or dumping them into the sea. Fortunately, the AMC guys were made to see that this direction bordered on madness, as the vehicles could be easily dismantled and added to the spare parts stock.

From 1985 to 1991, in addition to maintaining the parts operation, the small band of employees at Jeep Australia managed to build some more SJ Cherokees and J2O trucks, and convert a handful of YJ Wranglers to RHD. The enthusiastic team also imported, and converted, twenty-five 1989 Grand Wagoneers, which were quickly sold by a few of Jeep’s ex-dealers. The success of the Grand Wagoneer effort inspired the JA guys to seriously consider bringing larger quantities into the country. However, within weeks, Chrysler announced that production of the full-sized wagons would finally cease.

The spare parts operation continued until 1991, when it was decided to quit the old premises. The remaining stock was trucked to Sydney Jeep, who took over the national distribution of parts until Jeep (then owned by Chrysler) decided to have another crack at the Australian market. By then, Jeep Australia’s books were $11 million in the red.
Attached Thumbnails
Click image for larger version

Name:	JeepAustralia1.jpg
Views:	1195
Size:	33.0 KB
ID:	45543   Click image for larger version

Name:	JeepAustralia5.jpg
Views:	1128
Size:	35.1 KB
ID:	45544   Click image for larger version

Name:	JeepAustralia7.jpg
Views:	1109
Size:	36.2 KB
ID:	45545  
__________________

www.ausjeepoffroad.com
  #2  
Old 02-02-2011
rob_4x4  rob_4x4 is offline
I just registered
 
Join Date: Nov 2010
Posts: 6
What Jeep do I drive?: None
Likes: 0
Liked 0 Times in 0 Posts
Default

Another reason for the departure of Jeep was the Australian dollar crashed due to it being floated, going from above parity at about $1.20 AUD per USD to about $00.70 AUD per USD. At the time a CJ7 was about $17,000-$18,000 on the road and the drop in the Aussie dollar was going to cause the price to double virtually overnight. (In comparison a Corolla was about $7000 or so and a HiLux was about $13,000)

I was also lucky enough to get a tour through the Jeep factory at Salisbury in Brisbane at the end of 1984. I also got to have a drive of the Press demo CJ7 up through Mt Petrie on the same day.

Last edited by rob_4x4; 02-02-2011 at 11:51 AM.
  #3  
Old 02-02-2011
Jimmyb's Avatar
Jimmyb  Jimmyb is offline
Head Honcho
 
Join Date: Jul 2002
Location: Australia
Posts: 12,760
What Jeep do I drive?: XJ
Likes: 1,060
Liked 1,173 Times in 708 Posts
Check out my Ride(s)
Default

Have you got any old photos from back in the day Rob that you could share?
__________________

www.ausjeepoffroad.com
  #4  
Old 02-02-2011
buell's Avatar
buell  buell is offline
Established Member
 
Join Date: Jun 2010
Location: Brisbane
Posts: 210
What Jeep do I drive?: CJ
Likes: 0
Liked 0 Times in 0 Posts
Default

Thanks Jim.
Good stuff getting a handle on the OZ history

Buell
__________________
Keeping the dream alive.
  #5  
Old 02-02-2011
turbomart's Avatar
turbomart  turbomart is offline
SwampDigger
 
Join Date: Nov 2006
Location: Adelaide
Age: 55
Posts: 3,530
What Jeep do I drive?: WJ
Likes: 0
Liked 12 Times in 9 Posts
Default

Yep great stuff , its really hard to find out about what happened on this side of the pond.
__________________
I used to be indecisive but now Im not so sure!!!
  #6  
Old 24-04-2011
jklad's Avatar
jklad  jklad is offline
Full Flexer
 
Join Date: Jan 2009
Location: Sydney
Posts: 583
What Jeep do I drive?: JK
Likes: 0
Liked 3 Times in 2 Posts
Default

Never realised that the YJ's came here in LHD & were converted to RHD. Are YJ's as rare as hens teeth then here in OZ? Just asking because a guy near where I work has faded, original condition one in pure stock trim (the only one I think I've ever seen on the roads here) & doesn't seem to know much about Jeeps; may be able to make him an offer he can't refuse...

Last edited by jklad; 24-04-2011 at 11:21 PM.
  #7  
Old 25-04-2011
KarloXJ's Avatar
KarloXJ  KarloXJ is offline
Established Member
 
Join Date: Apr 2010
Location: Perth, WA
Posts: 177
What Jeep do I drive?: XJ
Likes: 0
Liked 0 Times in 0 Posts
Smile

Thanks man very interesting, never realised there were any YJ's distributed in Australia.
__________________

Jeeping.. Because Football, Basketball, & Cricket only take one ball!
Post New Thread  Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On





All times are GMT +10. The time now is 05:05 PM.


Advertisements




AJOR does not vouch for or warrant the accuracy, completeness or usefulness of any message, and are not responsible for the contents of any message. The messages express the views of the author of the message, not necessarily the views of AJOR or any entity associated with AJOR, nor should any advice be substituted as technical advice replacing that of a mechanic. You agree, through your use of this service, that you will not use AJOR to post any material which is knowingly false and/or defamatory, inaccurate, abusive, vulgar, hateful, harassing, obscene, profane, sexually oriented, threatening, invasive of a person's privacy, religious, political or otherwise violative of any law. You agree not to post any copyrighted material unless the copyright is owned by you or by AJOR. The owner, administrators and moderators of AJOR reserve the right to delete any message or members for any or no reason whatsoever. You remain solely responsible for the content of your messages, and you agree to indemnify and hold harmless AJOR, the administrators, moderators, and their agents with respect to any claim based upon transmission of your message(s). The use of profile signatures to intentionally mislead or misdirect any member on this forum is not acceptable and may result in your account being suspended. Any trip that is organised through the AJOR forum is participated at your own risk. If you or your vehicle is damaged it is your responsibility, not that of the person that posted the thread, message or topic initiating the trip, nor the organisers of AJOR or moderators of any specific forum. This forum and associated website is the property of AJOR. No user data is harvested and no information supplied in your registration will be sold for profit.


Powered by vBulletin® Version 3.8.7
Copyright ©2000 - 2024, vBulletin Solutions, Inc.

AJOR © 2002 - 2024 AUSJEEPOFFROAD.COM. All corporate trademarked names and logos are property of their respective owners. Ausjeepoffroad is in no way associated with DaimlerChrysler Corporation or Fiat Jeep.
www.ausjeep.com www.ausjeep.com.au www.midlifemate.com ausjeepforum.com www.r9kustoms.com
vB Ad Management by =RedTyger=