Stellantis, the multinational automotive corporation, is entering into a comprehensive strategic partnership with Leapmotor, a promising Chinese electric vehicle (EV) company. Leapmotor, established in 2015, has gained significant traction in the Chinese market and sold approximately 111,000 vehicles last year. Stellantis has decided to invest 1.5 billion euros (approximately $1.6 billion) to acquire a 20% stake in Leapmotor, becoming a key shareholder alongside Shanghai Electric Group and Sequoia Capital.
The investment by Stellantis will not only solidify its position in the EV market but also pave the way for the formation of a joint venture called Leapmotor International. In this venture, Stellantis will hold a majority stake of 51%. The primary objective of Leapmotor International will be the export and sale of Leapmotor vehicles outside of China, as well as their production. The joint venture is set to begin exporting vehicles in the second half of 2024, with Europe being the first target destination.
The first model to be exported under this partnership will be the Leapmotor C10, an electric crossover that made its debut at the Munich auto show in 2023. This model showcases Leapmotor’s commitment to innovation and design, making it an exciting addition to Stellantis’ portfolio of EVs.
The collaboration between Stellantis and Leapmotor aims to explore further synergies beyond the partnership. This could potentially involve the sharing of platforms and joint development of models, similar to the agreement between Volkswagen Group and China’s Xpeng, which was announced earlier this year.
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Stellantis’ CEO, Carlos Tavares, expressed his belief that consolidation among Chinese EV brands is inevitable in the coming years. He predicts that only a select few “efficient and agile” players will dominate the Chinese market, with Leapmotor being one of them. Tavares also acknowledged the challenges European automakers face from their Chinese counterparts due to lower production costs in China and the absence of steep tariffs on Chinese-built cars in Europe. This partnership with Leapmotor demonstrates Stellantis’ commitment to staying competitive in the rapidly evolving global EV market.
The Chinese EV market has become a crucial battleground for automakers worldwide. Foreign automakers have been losing market share in China, which they once dominated, primarily because of a lack of EV offerings. According to the China Association of Automobile Manufacturers, Chinese car companies accounted for 53% of sales in China during the first half of 2023.
Stellantis’ collaboration with Leapmotor not only allows them to tap into the growing demand for EVs in China but also strengthens their position in the European market. As part of their expansion plans, Stellantis aims to introduce Leapmotor’s EV models to European consumers, capitalizing on their advanced technology and appealing designs.
In summary, the partnership between Stellantis and Leapmotor marks a significant step in the global EV landscape. By investing in Leapmotor and forming a joint venture, Stellantis aims to leverage their expertise in the Chinese market and expand their presence beyond China. This strategic collaboration will not only benefit both companies but also contribute to the overall growth of the EV market. With the first exports scheduled for 2024, it will be interesting to see how Stellantis and Leapmotor navigate the challenges and opportunities that lie ahead in the rapidly evolving world of electric mobility.
