Auto manufacturer Stellantis collaborates with electric vehicle battery supplier CATL and automaker Leapmotor to produce electric vehicles in Europe
In a bid to maintain competitiveness in the rapidly evolving electric vehicle (EV) market, Stellantis, the automobile conglomerate behind brands like Fiat, Chrysler, and Jeep, is making strategic moves across Europe.
Carlos Tavares, Stellantis' CEO, has expressed doubts about the effectiveness of new tariffs in bridging the cost competitiveness gap between European and Chinese players in EV production. This concern arises as Chinese players enjoy a 30% cost advantage in EV production, a reality Tavares acknowledges.
To counter this, Stellantis is forging partnerships with Chinese EV startup Leapmotor in the Netherlands and battery manufacturer CATL, among other Chinese players. The joint venture with Leapmotor will see Stellantis facilities in Europe producing Leapmotor EVs, with sales commencing in nine European countries, including Germany, starting in September.
Meanwhile, Stellantis is collaborating with CATL to build a lithium iron phosphate (LFP) battery factory in Zaragoza, Spain. Production is expected to commence by the end of 2026. This factory will be responsible for manufacturing batteries for Stellantis' B-series EVs, including the B10 SUV, at the Stellantis plant in Zaragoza for the European market.
Stellantis' strategy involves leveraging these partnerships to stay competitive and maintain a cost advantage. The company is also working to cut costs and is on track to achieve its goal of reducing annual costs by EUR 5 billion (USD 5.39 billion) a year ahead of schedule in 2024.
However, these partnerships are not expected to drive substantial growth for Stellantis on their own. The company, which currently has a limited presence in the Chinese market, making up only 1% of its new vehicle sales, faces challenges in emulating the success of competitors like BMW, which sells 32% of its new vehicles in China and exports Chinese-made EVs to Europe.
In light of these challenges, Stellantis is boosting European output to avoid additional tariffs of up to 38% on Chinese EV imports, announced by the European Union due to unfair subsidies from Beijing. The company's strategic shift towards Europe is a response to the increasing presence of less expensive Chinese EVs in the region.
This article was first published on Nikkei Asia and is being republished as part of 36Kr's partnership with Nikkei.
Read also:
- visionary women of WearCheck spearheading technological advancements and catalyzing transformations
- A continuous command instructing an entity to halts all actions, repeated numerous times.
- Oxidative Stress in Sperm Abnormalities: Impact of Reactive Oxygen Species (ROS) on Sperm Harm
- Genetically manipulated rabbits sprout ominous black horns on their heads
