Stellantis Explores Leapmotor Collaboration for Cost-Effective EV Solutions
In a bid to enhance its electric vehicle offerings, Stellantis NV is evaluating collaboration with its Chinese partner, Leapmotor. The focus is on integrating advanced battery and EV powertrain technology to reduce costs for its European brands, including Fiat, Opel, and Peugeot, as per sources familiar with the strategy.
Stellantis, which currently distributes Leapmotor models like the C10 SUV through its dealerships in Europe, is considering expanding its joint venture with Leapmotor. The aim is to utilize the Chinese company’s cutting-edge technology to strengthen Stellantis’ market position. However, negotiations are still in early stages, with significant regulatory hurdles to overcome, particularly concerning data protection and upcoming U.S. regulations against importing Chinese tech in connected vehicles by 2027.
This potential agreement marks a pioneering move by a major Western car manufacturer to leverage Chinese technology in European markets. Stellantis shares experienced a modest rise of 0.6% in Milan trading, though overall, the stock has seen a 31% decrease since the beginning of the year.
More: Stellantis says no 2025 profit sharing checks for its U.S. autoworkers
Stellantis has indicated that its partnership with Leapmotor is aimed at leveraging the strengths of both companies, with ongoing discussions about deepening their cooperation. However, Stellantis refrained from providing further commentary. During a recent presentation, the company described 2025 as a pivotal year for strategic implementation, paving the way for more significant collaboration.
Leapmotor declined to comment on the matter.
The proposed partnership could significantly cut development costs for Stellantis, enabling it to better compete with Chinese firms like BYD Co. and MG, as well as local competitors such as Volkswagen AG and Renault SA. Stellantis is currently realigning its EV strategy, having announced substantial writedowns and charges totaling €22.2 billion (approximately $26 billion) earlier this month. The automaker is also reassessing its battery joint ventures in light of these changes.
More: Stellantis reports first annual loss after massive EV charges
In response to market dynamics, Stellantis is reintroducing the Hemi V-8 engine for its Ram trucks and incorporating diesel engines in models like the Opel Astra and Peugeot 308 in Europe, alongside a hybrid Fiat 500. Although deeper collaboration with Zhejiang Leapmotor Technologies Inc. has been on the agenda for some time, Stellantis is now prioritizing the use of Leapmotor’s technology.
Other manufacturers are similarly reacting to competitive pressures from Chinese automakers. Volkswagen, for instance, is utilizing Xpeng Inc.’s platform for its EVs, while Renault’s new electric Twingo, slated for European release, is based on Chinese R&D efforts.
Stellantis’ collaboration with Leapmotor commenced in 2023 under then-CEO Carlos Tavares. The deal initially involved Stellantis acquiring a 20% stake in Leapmotor for $1.1 billion, which has since been diluted to 15%, and forming the joint venture Leapmotor International. The partnership has led to the introduction of three Leapmotor models in Stellantis’ European network.
As Stellantis navigates market challenges in the U.S. and Europe, a deeper alliance with Leapmotor could prove pivotal. CEO Antonio Filosa is expected to outline the company’s strategic direction at an upcoming capital markets event in May. Stellantis is also capitalizing on its $13 billion investment in the U.S., its primary profit center led by Jeep, Ram, and Dodge brands, although its European operations face difficulties due to overcapacity and stiff competition.
Original Story at www.detroitnews.com