Stellantis reportedly weighs using Chinese EV to cut costs

Stellantis is exploring the use of Chinese EV technology from Leapmotor to reduce costs for its European mass-market brands, including Fiat, Opel, and Peugeot, according to people familiar with the plans.

The automaker is considering expanding its joint venture with Leapmotor to access advanced battery and EV powertrain technology, though talks are still in early stages.

Any agreement would need to address concerns over data security and US regulations that, from 2027, ban the import or sale of connected vehicles with technologies linked to China or Russia, people said.

Stellantis currently sells Leapmotor models like the C10 SUV in Europe.

The company aims to finalize a deal within the year, which would be the first time a major Western automaker relies on Chinese vehicle components and software, sources said.

The move could help Stellantis compete with Chinese brands such as BYD and MG in Europe and reduce development costs, analysts say.

Stellantis has previously scaled back its EV investments, including writedowns and charges of €22.2 billion (US$26.2 billion) earlier this month amid broader market challenges.

🔗 Source: Bloomberg

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Implications, context, and why it matters.

Stellantis wants broader use of Leapmotor EV technology through its joint venture

Stellantis is weighing wider use of Leapmotor technology, building on a €1.5 billion investment and its 51% controlling stake in the joint venture, Leapmotor International B.V. 1.
The deal also gives Stellantis exclusive rights to manufacture, export, and sell Leapmotor EVs outside China, making the joint venture the main route for Leapmotor’s overseas expansion 2.
The arrangement is already running. Stellantis sells Leapmotor models in Europe, including the C10 SUV. Sales were set to start in September 2024 in nine countries through Stellantis dealer and after-sales networks. Leapmotor International opened European orders for the T03 city car and C10 SUV at the end of September 2024 3.

A transatlantic split is pushing a two-track EV plan

US policy could block parts of the rollout. Proposed US restrictions would, if finalized, ban the sale or import of connected vehicles that use certain technologies tied to China or Russia. Software limits would begin with Model Year 2027 4.
The proposal covers vehicle connectivity systems and automated driving systems. It can apply based on where the covered software or hardware supplier is based, not where final assembly happens 4.
Europe is taking a different path. Rules there focus more on data privacy than national security, which leaves more room for Stellantis to use Leapmotor’s lower-cost technology against Chinese competitors such as BYD and MG 5.
That gap could leave Stellantis running one tech stack for Europe and other markets, plus a separate compliant stack for the US. Extra engineering work could cut into the cost savings the deal targets.