It's been reported that when Mercedes bought Chrysler, the crown jewel was considered to be Jeep. The Jeep brand is an instantly recognizable American icon and Jeep has legions of serious Jeep enthusiasts. I remember reading how Jurgen Schrempp, then-Chairman of the newly-minted DaimlerChrysler AG, had a Jeep Wrangler flown to Germany for his family's private use.

Let's review what's happened to Jeep since the forced marriage with Mercedes-Benz in 1998. The Wrangler continues on the same platform with little updating or re-engineering. It's in desperate need of a complete rebirth. The Jeep Grand Cherokee was redesigned; but the redesign was done on the cheap and while the chassis is supposed to be better this generation, I can attest to the cheapness of the interior and poor overall fit/finish.

Shortly after the merger, the Jeep Liberty was introduced. The Liberty was already in the pipeline and it has become a solid seller for Jeep. But the Liberty has never been a very good truck. It has some of the Jeep DNA to give it some off-road creds; but the overall drive and ride of the Liberty leaves a lot to be desired. The second generation Liberty is due in about a year and let's hope the engineers do more for the Liberty than they did for big brother Grand Cherokee.

The first all-new product for Jeep since the Liberty is the Commander, introduced last year. It's also the first new Jeep developed under the DCX umbrella. The Commander is a large, stretched Grand Cherokee that got hit with the ugly stick too many times during development. And the gas-guzzling Commander came to market just as gasoline prices climbed past $3.00 per gallon in the aftermath of hurricane Katrina. Dan Neil of the LA Times gave the Commander one of his worst reviews of the year. In fact, it's so bad that even in LA, land of huge consumption and huge SUVs, the Commander is almost non-existent. You can't even get a rich rap star or athlete to pimp one out. It just doesn't have the presence or cool factor necessary to interest any buyer.

What's coming up for Jeep? Well, the first car will be a badge engineering job called the Compass. It's supposed to be a 2008 model, so look for the production version in 12-18 months. The Compass will be based on the upcoming Dodge Caliber. The Caliber is a 4-door hatchback which will replace the unloved Neon.

Both the Caliber and Compass are car-based "crossover" vehicles that are supposed to be what customers are looking for. Just don't call it a hatchback. The pictures of the pre-production Compass look pretty good. I think it could be a good car to revive the Jeep brand and give dealers a medium-priced car with better-than-a-truck fuel economy. The Compass has the potential to be a high volume vehicle for Jeep, somewhere in the volume of the Liberty.

The problem may be in the timing. The production Compass will debut in Detroit next week. However, it's unclear when it will be on the market. As I said above, the Compass is slated to be a 2008 model; however, since Jeep doesn't have any other vehicles scheduled to be released this year, waiting more than a year for the Compass may significantly impact Jeep dealers.

But the real news isn't just the fact that DCX has allowed Jeep and its iconic Wrangler to starve to near-death. It's the fact that Toyota has two brand new models on the market today that are going to command the attention of buyers who aren't willing to wait for a new Jeep.

Already on the market at the end of 2005 is Toyota's third generation RAV4. The 2006 RAV4 rides on the Corolla platform, as have previous versions. However, Toyota continues to polish its products and this generation, there is a new 3.5L V6 as an option to the base 2.2L I-4. And both a 4-speed and more modern 5-speed automatic transmissions are available depending on trim level and engine. Toyota even added third row seating. Of course, only very small children could ride in the third row; however, the option gives Toyota bragging rights for the most seats in a small SUV. In fact, both the Jeep Compass and Dodge Caliber are direct competitors to the RAV4. But the RAV4 is very refined (if boring) and even Toyota is showing a bit more flair and style, both inside and out these days. It's also almost a given that the RAV4 will be economical and reliable. And there is no question that the Toyota will command higher residuals when it comes time to sell or trade. Conversely, the Caliber/Compass siblings are all new with no track record. And the Chrysler group doesn't have the best reputation for reliability or resale value.

The bad news for Jeep doesn't stop there. The 2007 Toyota FJ Cruiser is in production and will go on sale in the US in the next two or three months. It will be at all the auto shows this month and I can assure you that Toyota dealers will be taking orders for the FJ as soon as people see it. Toyota isn't stupid. The FJ is mostly a reskinned 4Runner/Tacoma pickup truck. It gets the same 4.0 L V6 and 5-speed automatic from the 4Runner and since both the 4Runner and Tacoma have been on the market for a while, there is already a huge aftermarket parts and tuning inventory ready for the FJ buyer.

Toyota did a good job of translating the show car into a production model. Usually, all the emotion and bling from a show car disappear in production. While the FJ loses some of its show car "wow" factor, the production FJ has plenty of unique sheet metal and interior parts to set it apart from the blander 4Runner/Tacoma.

Toyota has taken a retro icon that most of its customers have no idea even existed -- and brought it into modern times. Unlike the dopy looking Chevrolet HHR which mimics a 1949 Suburban that only the most hardcore Chevy fans remember, you don't have to know anything about Toyota's 1958 FJ28V to "get" the all new 2007 FJ Cruiser. In fact, Toyota is counting on the "cool" factor to sell lots of these new trucks to young male buyers who want a modern truck to take off road or just dress up to look cool and sit high while crawling through LA traffic.

The Toyota FJ has the same off-road look that a modern Jeep should have. After the years of neglect of the Jeep brand, will younger American buyers even care about Jeep or will they be more interested in what Toyota has to offer. The FJ is a stellar example of platform and powertrain sharing. Customers aren't going to look at the FJ and think it's just a 4Runner with a different name. However, the Jeep Compass is going to share more than just a platform and powertrain with the Dodge Caliber. Much of the sheet metal is going to be the same and the interiors are very similar. Customers will notice the similarities between the Dodge and Jeep siblings -- and in general, comparing a Jeep to a Dodge can't be good for Jeep dealers or customers.

Motor Trend magazine chose the new Nissan Xterra as its Sport Utility of the Year in 2005. The Toyota FJ will be a top contender in 2006 for the same honors. Will Jeep have anything in the running for 2006? Right now it doesn't look like Jeep will have either the new Liberty or the Compass available in 2006 for customers or car magazines to evaluate. With Toyota, Nissan and even Honda in the truck business these days [Motor Trend chose the Honda Ridgeline as its Truck of the Year in 2005], a car company can't just drag its feet while its brand credentials erode. GM has learned that with Oldsmobile, Buick and Pontiac. Ford is learning that with Lincoln and Mercury. At least GM will have its all new Tahoe and Yukon trucks in the marketplace in 2006, and from all reports, these are pretty nice trucks. Jeep can't keep showing cool concept cars and then not come through with production models. The Commander was a bad mistake on so many levels -- wrong product, wrong time, wrong styling. The Compass needs to be here now to give dealers some fresh product to sell.

Jeep is showing the Gladiator pickup truck as a concept truck this year at the shows. Jeep hasn't had a pickup in its line up for a very long time. The concept Gladiator is great. The big question is why didn't Jeep pick the Gladiator to come to market rather than the ugly Commander? Jeep has been and continues to be managed badly.

Is it too late for Jeep? I don't think so. I hope not. But when your competition is Toyota, Nissan and Honda, you can't just lay back and expect customers to jump if and when you introduce new product. And what happens when VW wakes up and starts building smaller crossover vehicles? Mercedes is probably going to make a C-Class sized SUV for the US market to counter the already popular BMW X3. Brand loyalty is earned, not taken for granted. Jeep has been taking its customers for granted for much too long and in the twenty-first century, that can be a fatal mistake.