Stellantis Explores Dongfeng Partnership to Boost Europe production

Stellantis is exploring a renewed partnership with Dongfeng Motor that could reshape its manufacturing footprint across Europe and China.

The discussions come as the automaker looks to address underused factories and rising competition, while Chinese partners seek local production to navigate European tariffs.

Stellantis and Dongfeng explore joint production across regions

Stellantis is in talks with Dongfeng Motor to potentially share manufacturing capacity. The proposal could give Dongfeng access to Stellantis’s underutilized European plants, while allowing Stellantis-branded vehicles to be produced in China.

Representatives from Dongfeng have already visited facilities in Germany and Italy, with discussions reportedly including potential investment or partial acquisition of select European factories. The move would help Stellantis improve plant utilization and reduce costs, while offering Dongfeng a pathway to localize production in Europe.

The partnership would revive a relationship that dates back to the early 1990s, when PSA Group, Stellantis’s predecessor, formed a joint venture with Dongfeng to enter the Chinese market.

China partnerships expand as Stellantis adapts to EV competition

The talks reflect broader pressure on Stellantis as it faces intensifying competition from global rivals such as Volkswagen and BYD, alongside fast-rising Chinese EV brands.

Stellantis has been actively exploring partnerships to strengthen its EV strategy. Executives have previously held discussions with companies like Xiaomi and Xpeng, while its collaboration with Leapmotor is already advancing.

In 2023, Stellantis invested €1.5 billion in Leapmotor, becoming its largest external shareholder. The two companies are now working on an Opel electric SUV based on Leapmotor technology, with production expected to begin in 2028 at Stellantis’s Zaragoza plant, targeting annual output of around 50,000 units.

As European tariffs push Chinese automakers toward local production, and legacy manufacturers seek efficiency gains, Stellantis’s renewed engagement with Dongfeng highlights a growing trend of cross-border collaboration in the evolving EV landscape.

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