Why Are Jeep Cherokees So Cheap? (Hidden Facts Revealed)

why are jeep cherokees so cheap

Jeep Cherokees have developed a reputation over the years for being one of the most affordable SUV options on the used car market. In fact, it’s not uncommon to find lightly used Jeep Cherokees priced thousands below similar vehicles like the Toyota RAV4, Honda CR-V, or Subaru Forester.

So why exactly are Jeep Cherokees so cheap, especially on the used market? The short answer is that Cherokees tend to have below average reliability which brings resale values down. They also get sold in large volumes to rental fleets which increases the supply in the used car market. However, there are even more hidden facts behind the Jeep Cherokee’s budget-friendly pricing.

In this in-depth blog post, we’ll uncover the real reasons why the Jeep Cherokee consistently ranks as one of the most affordable compact SUVs. We’ll look at hidden factors like poor reliability ratings, fleet and rental car sales, lack of amenities on base models, brand perception, and depreciation rates. We’ll also consider some alternative vehicles that could be a better long-term value.

Let’s dive in and reveal the hidden truths about why you can buy a Jeep Cherokee for such a bargain price!

Hidden Fact #1: Jeep Cherokees Have Below Average Reliability Ratings

One of the major contributors to the budget pricing of Jeep Cherokees is that they consistently score below average in various vehicle reliability surveys. Sources like Consumer Reports and J.D. Power give Jeep Cherokees poor long-term dependability scores compared to competitors.

For example, in Consumer Reports 2022 reliability rankings, the Jeep Cherokee ranked near the bottom of the compact SUV segment. It received an overall reliability score of just 44 out of 100 points. That’s far below top ranked rivals like the Toyota RAV4 which earned 83 points.

Some of the most common issues reported in reliability surveys for Jeep Cherokees include:

  • Power equipment problems – electrical issues with windows, locks, climate control
  • Transmission repairs – rough shifting, jerky performance, premature failure
  • Check engine light – sensor and emissions problems trigger warning light
  • Electrical gremlins – glitches with lighting, stereo, power features
  • Air conditioning – A/C fails prematurely, refrigerant leaks

Since Jeep Cherokees tend to suffer more frequent mechanical and electrical issues, they are more likely to require expensive repairs. This brings down used resale values. Why would someone pay top dollar for a used Jeep with questionable reliability?

The end result is used Jeep Cherokees often sell for $2,000 – $5,000 less than a similarly equipped Honda, Toyota or Subaru with better dependability scores. Reliability issues are a key factor that allows used Cherokees to be such a bargain.

Hidden Fact #2: Most Jeep Cherokees are Sold as Rental and Fleet Vehicles

Another major contributor to the affordability of Jeep Cherokees is that the majority are sold not to individual owners but to large rental car and corporate fleet customers.

It’s estimated that over 50% of all Jeep Cherokees are sold as rental cars to companies like Hertz, Enterprise, and Avis. These rental Cherokees generally stay in the fleet for 1-2 years before being sold off.

An additional 25-30% of Jeep Cherokees are sold as fleet vehicles to corporate buyers and government agencies. These fleet Cherokees are cycled out of service after just a few years as well.

So why does being a former rental or fleet vehicle impact used prices? There are a few reasons:

  • High mileage – Rental and fleet Jeeps often have 75,000+ miles when sold, more than privately owned. High miles equal lower values.
  • Wear and tear – Rentals and fleet vehicles tend to suffer more interior damage and body dings from being used by multiple drivers. Adds up on resale.
  • Limited service history – Large fleets only perform basic maintenance. No dealer record of meticulous owner service.
  • Oversupply – Flooding the used market with former rentals and fleet units brings overall resale values down.

Based on this trend of selling primarily into high-volume rental and corporate fleet channels, Jeep Cherokees enter the used car market faster and in higher numbers. This ample supply of low-mileage former fleet Cherokees for sale allows dealers to keep resale prices exceptionally low.

Hidden Fact #3: Base Trims Have Very Few Amenities

Another reason shoppers can find used Jeep Cherokees listed for lower prices is that base model Cherokees lack many of the luxury options and amenities found in competitors.

The entry-level Latitude trim Cherokee for example has mostly basic features like:

  • Cloth seats
  • Manual seats
  • Small touchscreen with limited tech
  • Steel wheels with hubcaps
  • Manual climate control
  • Basic audio system

For buyers focused solely on price, the base Cherokee Latitude appears like an amazing deal. However, when you compare it to a base CR-V or RAV4, you’ll notice those rival SUVs still come reasonably well-equipped even on base trims.

It’s only when you move up to the loaded Limited and Trailhawk trims that the Cherokee starts to offer amenities like leather, navigation, premium audio, and advanced safety tech. But most buyers won’t pay top dollar for a fully loaded used Cherokee given the reliability concerns.

So on the low end, base model Cherokees appear attractively priced but lack features you get standard on competitors. Their amazing price comes with a big trade-off in amenities.

Hidden Fact #4: Jeeps Have an Inexpensive Brand Perception

The Jeep brand as a whole suffers from a perception of being one of the more affordable SUV options. Iconic models like the Wrangler do hold their value exceptionally well. However, other Jeeps like the Cherokee are viewed by consumers as being budget-friendly.

Buyers shopping for used SUVs tend to expect that they should be able to find a good deal on a Jeep. That brand identity has almost become ingrained in the minds of used car shoppers. As a result, dealers list their used Cherokees at lower prices to meet that customer expectation.

Interestingly, various studies have shown that the average new car transaction price for a Jeep Cherokee is only about 8% less than a Honda CR-V. However, when comparing 3-year old used models, Cherokees sell for 20-25% less than a similarly equipped CR-V.

The takeaway is that the affordable Jeep reputation really manifests itself in the resale value, allowing used buyers to get more for their money. That bargain Jeep stereotype enables used Cherokees to be such a steal.

Hidden Fact #5: Older Jeep Cherokees Depreciate Very Quickly

The final hidden factor that makes Jeep Cherokees so budget-priced on the used market is that older models depreciate much faster than rivals. While all vehicles lose value over time, Cherokee resale values tend to fall off a cliff past the 5-year mark.

For example, a 5-year old Jeep Cherokee typically retains around 30-35% of its original MSRP. However, extending out to eight years, a Cherokee only retains 15-20% of its original new car price.

That rapid depreciation allows buyers to get sizable SUVs like the Cherokee for very affordable pricing once they are 6, 8, or 10 years old. The steep depreciation curve is helped by the high volume of trade-ins from lease returns and fleet sales.

So in summary, the combination of poor reliability, high fleet and rental volume, lack of features on base trims, brand perception, and rapid depreciation all contribute to the mystifyingly low pricing of used Jeep Cherokees. For buyers purely chasing value, they are undeniably one of the most affordable used SUV options on the market.

What are Some Alternatives to Consider?

Given the many hidden facts behind the temptingly cheap pricing of Jeep Cherokees, what are some alternative used SUVs to consider? Here are a few recommendations:

  • Toyota RAV4 – The RAV4 is the top selling compact SUV for good reason – it offers better predicted reliability than the Cherokee along with strong resale value. Base trim RAV4s also come nicely equipped. Look for 2013-2016 models in the same price range as a Cherokee.
  • Honda CR-V – Like the RAV4, CR-Vs earn top marks for reliability and hold value better than Jeeps. Roomy interior and available AWD make it a solid Cherokee alternative. Target 2012-2015 models for good value.
  • Subaru Forester – With standard AWD, roomy interior, and better reliability scores, the Forester makes for a smart Cherokee alternative. Strong resale value but deals can be found on 2014-2016 examples.
  • Mazda CX-5 – For buyers wanting a more car-like compact SUV, the CX-5 is affordable while still offering good reliability and sharper handling. Find deals on 2014-2016 models.
  • Ford Escape – The Escape is another value-priced option with ample cargo room. Go for the more reliable 2015+ refreshed generation. Target higher trim levels for Cherokee-like amenities.

Conclusion: Great Price but Consider Ownership Costs

In the compact SUV segment, the Jeep Cherokee clearly stands out as most affordable used option on the market. However, there are many hidden factors behind that tempting price tag for pre-owned Cherokees.

While the upfront purchase price is alluring, buyers should carefully weigh higher ownership costs due to mediocre reliability before choosing a used Cherokee. For some buyers, opting for a pricier but more dependable used RAV4 or CR-V ends up being the better value in the long run.

Nonetheless, if you prioritize getting the most SUV for the least amount of money, it’s hard to beat a used Jeep Cherokee. Just go in with eyes wide open about the higher maintenance costs. And be sure to have your mechanic thoroughly inspect any Cherokee before buying to identify any lurking issues the current owner may not be disclosing.

What has your experience been buying or owning a used Jeep Cherokee? Share your thoughts in the comments!

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *