Leapmotor Begins European Production at Stellantis’ Poland Plant

Chinese electric vehicle (EV) company Leapmotor has started production of its EVs in Europe through a joint venture with Stellantis. As of now, initial units of Leapmotor’s T03 compact EV model have already rolled off the assembly line at Stellantis’ production facility in Tychy, Poland.

According to a report from Jefferies, it cited statements from Leapmotor’s management confirming the start of T03 production in Poland. Mass production of the small EV model is on schedule to start in September ahead of Leapmotor’s planned European sales launch later this fall.

Notably, Leapmotor’s entrance into local European production is made possible through its joint venture with Stellantis called Leapmotor International. Formed last year, the joint venture allows a 51/49 Stellantis-led company with exclusive rights to produce, export, and sell Leapmotor’s Chinese EVs in Europe and other major markets outside of China.

Furthermore, selecting the Tychy plant in Poland as the assembly site was a strategic cost-saving decision according to Reuters. This is showcased by Leapmotor managers telling Jefferies that production costs at the Polish facility equate to only €400-500 ($428-$535) per unit, which is similar to production pricing in China and significantly lower than an estimated €1,000 ($1,074) per unit at Stellantis’ plants in Italy.

However, Leapmotor’s larger C10 electric SUV model will initially be imported into Europe from the company’s Chinese production plants due to taking advantage of potentially higher pricing for the bigger C10 in the European market according to Jefferies.

Importantly, the ramp-up of Leapmotor’s European production footprint comes just ahead of new European Union tariffs on imported Chinese EVs set to take effect in July 4. Once implemented, the 21% rate could make locally-produced models such as the T03 more cost-competitive compared to direct imports according to Reuters.

As Leapmotor International recently launching into nine markets, the European expansion underlines Leapmotor’s aim for global markets. With Stellantis as a partner, Leapmotor could carve out a major presence if its affordable EVs resonate with European buyers.

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