Stellantis to export China-made EVs to Europe by way of Leapmotor deal

Automaker Stellantis expects to shortly develop gross sales of China-made electrical autos exterior of the nation by a brand new three way partnership with Leapmotor, beginning later this yr.

The businesses said Tuesday gross sales of the China-built Leapmotor autos will start by Stellantis’ distribution networks, together with sellers in Europe — France, Italy, Germany, Netherlands, Spain, Portugal, Belgium, Greece and Romania — starting in September.

These first markets might be adopted by the Center East and Africa, India and Asia Pacific, and South America in late 2024, the businesses stated.

The growth plans don’t presently embrace distribution within the U.S., Stellantis CEO Carlos Tavares stated Tuesday following a press convention in Hangzhou, China, the place Leapmotor is predicated. He cited, amongst different causes, new American tariffs on China-made EVs.

The Biden administration Tuesday introduced stiff new tariff rates on $18 billion value of Chinese imports, together with quadrupling tariffs on imported Chinese language electrical autos, from 25% to 100%. 

“There may be very restricted Chinese language providing within the U.S. market, so it’s not a precedence for us,” Tavares stated. “There’s a lot in Europe, as a result of we see Europe has a really completely different strategy for this drawback … It appears just like the U.S. goes for a really sturdy protectionism. Whereas, in the interim, I see Europe is preserving the market moderately open.”

The three way partnership’s growth plans embrace a minimum of six EVs by 2027, in accordance with a presentation by Stellantis and Leapmotor. The vehicles, initially finances autos, are anticipated to be complimentary to Stellantis’ present car lineup, the businesses stated.

The announcement comes amid growing geopolitical tensions surrounding China-made electrical autos within the U.S., Europe and different nations. Many in and across the automotive trade concern the less-expensive, China-made autos will flood the markets, undercutting domestic-produced EVs.

“From a Stellantis perspective, our place is we compete. We compete with the Chinese language carmakers and we compete as strongly as we are able to as a result of it is one of the simplest ways to be taught. It is one of the simplest ways to remain match for the worldwide race during which we are actually a part of,” Tavares stated.

Tavares stated Tuesday the Chinese language carmakers, which he has previously called Stellantis’ greatest competitors, are anticipated to quickly develop internationally — with or with out three way partnership help.

“Whether or not I prefer it or not, with me or with out me, Leapmotor would have been in Europe anyway … maybe not as quick, maybe not as strongly however they’d have gone to Europe,” Tavares stated. “What I’m doing is simply attempting to be opportunistic in opposition to a dynamic that has been created by the Chinese language carmakers.”

Chinese language firms accounted for 8% of Europe’s all-electric car gross sales as of September and will enhance their share to fifteen% by 2025, the European Union stated final yr. The EU believes Chinese language EVs are undercutting the costs of native fashions by about 20% within the European market.

The inflow of Chinese language EVs has spurred the European Union to launch authorities help for the trade.

“The partnership between Leapmotor and Stellantis demonstrates a excessive degree of effectivity, opening a brand new chapter within the international integration of China’s clever electrical car trade,” Leapmotor founder, chairman and CEO Jiangming Zhu said in a release. “We imagine that this cooperation may give Leapmotor a lift to develop into a revered world-class clever electrical car firm.”

The businesses declined to reveal gross sales volumes expectations for Leapmotor autos offered by Stellantis’ gross sales community, which is predicted to develop from 200 areas to as much as 500 by 2026. Leapmotor reported deliveries of 144,155 autos in 2023, a roughly 30% enhance from the earlier yr.

Stellantis owns 51% of the three way partnership with Leapmotor, introduced earlier this yr and together with and funding of 1.5 billion euros in Leapmotor for a roughly 21% stake within the firm.

As a part of the deal, Stellantis has unique rights for export and sale, in addition to for manufacturing Leapmotor merchandise exterior of Higher China.