Stellantis says U-turn on China will help it beat EV rivals
Published Fri, Oct 27, 2023 · 9:12 am
businesstimes.com.sg
Stellantis has struggled to gain traction in China, compared with the likes of VW and BMW.
PHOTO: REUTERS
STELLANTIS says its US$1.1 billion purchase of a stake in a Chinese electric vehicle (EV) maker will help it offer more affordable EVs and gain an edge on rivals bracing for an onslaught of cheaper exports from the country.
“The Chinese offensive is visible everywhere,” chief executive officer Carlos Tavares told reporters on a call on Thursday (Oct 26). Through the deal with Zhejiang Leapmotor Technologies, “we can be benefiting from this Chinese offensive rather than being a victim”.
Stellantis will end up with about 21 per cent of Leapmotor and two board seats after the deal. Crucially for Tavares, it will also have a controlling stake in a joint venture that will allow Stellantis – the maker of Jeep SUVs and Peugeot and Fiat automobiles – to build and sell some Leapmotor cars outside China.
The European Union last month launched an investigation into Chinese subsidies for EVs to ward off a flood of low-cost imports. Stellantis earlier this month unveiled its e-C3, the cheapest Europe-made EV, with a starting price of 23,300 euros (S$33,694), a key model at a time when some countries, notably France, are changing their incentive systems to subsidise locally made cars.
Leapmotor’s technology and its better insights into China’s EV supply chain will enable Stellantis to produce cheaper EVs, without relying on the outcome of the EU’s probe, Tavares said.
“A probe is like giving you a shot to go to sleep,” the CEO said. It “can represent a bad excuse not to do the right things at the right speed to compete with my Chinese competitors. I have to race”. |
