This is one of the new Chinese manufacturers trying to take over the European electricity market. Leapmotor will sell shares of its capital to Stellantis in exchange for an investment of 1.5 billion euros in the company, the group’s CEO, Carlos Tavares, announced during a conference call. In total, the manufacturer’s participation, resulting from the merger between Fiat Chrysler and Peugeot SA, will reach 21.2%.
It must be said that the Chinese start-up, based in Hangzhou and specialized in the development of electric vehicles, is already well established in the largest automobile market in the world. It launched its first model in 2019 and today sells 10,000 vehicles per month in China.
200 vehicles in France
Still little known in France, where it arrived last spring, the company offers a compact model, the T03, at 26,000 euros, to “satisfy the market demand” for low-end electric cars, explained the president of its international commercial division Matt Lei at the IAA Motor Show last September. In total, around 200 electric vehicles developed by Leapmotor are currently driving on French roads.
A figure that the manufacturer intends to increase thanks to its alliance with the Italian-French-American group Stellantis. During the auto show, Matt Lei acknowledged the “difficulty” of Chinese players, such as BYD, Geely, XPeng, Nio and Leapmotor, establishing themselves in Europe.
A gateway to the European market
Although technologically promising compared to their European competitors, small Chinese manufacturers, whose presence was highlighted at the September Motor Show, are seen as a threat on the old continent. This is mainly due to the very low sales prices of their vehicles, which gives them a considerable comparative advantage. Result: They are struggling to obtain all the necessary authorizations from the European Union to be able to deploy more widely.
Without forgetting that the opening of an investigation on Chinese public subsidies for electric cars by Brussels could also lead to an increase in customs duties applied to these vehicles.
In this sense, the entry of Stellantis into the capital of Leapmotor and the creation of a joint venture represents a win-win agreement. The American-European group will be able to carve out a niche in the low-end electric segment and at the same time strengthen its presence in China. As for the young company Leapmotor, it should see the doors open to the European market and, in particular, the French one, which it is targeting first.
Source: BFM TV
