Leapmotor considers ramping up Europe production to dodge tariffs

Leapmotor is looking to move production of its European-market models to the continent in a bid to bypass new EU tariffs on Chinese-made EVs.

The eight-year-old EV brand, which was part-bought by Stellantis as part of a £1.3 billion deal last year, considers Europe as one of the key markets in its global expansion push.

Leapmotor International CEO Tianshu Xin told journalists at the Paris motor show that it would look to build cars on existing Stellantis production lines, joining the Polish-made T03 supermini.

The brand also sells its C10 SUV in Europe, but it being built in China means it now attracts an additional 20% EU import tariff.

It will be joined on Chinese production lines next year by the recently announced B10 crossover, which is seen as “crucial” for Leapmotor’s global expansion.

Asked if production for both could be moved to Europe, Xin said: “We are deciding which models [we will build in Europe] and when to localise production. It’s all about available capacity at plants. But with Stellantis, we have the flexibility to choose where and when.”

The speed at which this decision is made will be the key to the brand’s success in Europe, Xin said, given that other Chinese brands – such as BYD, GWM and MG – are already established in Europe.

“This speed [in building our business here] is important to success. We need to establish ourselves as soon as possible with other Chinese brands here. We will be able to achieve this speed with the help of Stellantis.”

Another way that Leapmotor will differentiate itself and “build trust” with buyers is with its aftersales offering, said Xin.

Currently, Chinese brands are struggling with parts supply issues – leading to many cars being written off for relatively small issues. But Leapmotor will leverage Stellantis parts firm Distrigo to have stock delivered three times a day to service centres that it will share with other brands, such as Citroën, Peugeot and Vauxhall.

This approach will mean the brand will “stay forever”, said Xin, “because we are part of the Stellantis group”.

Stellantis boss Carlos Tavares told Autocar that Leapmotor could be one of the group’s answers to low-cost EVs, “but not the only one”.

He said: “The new Citroen eC3 starts at €20,000, If you use a reasonable subsidy from the government [as you get in France currently], you are going to be at €16-17,000. That’s where we are with the Smart Car platform [on which the e-C3 is based].

“Then we add Leapmotor, which, of course, has the capability to be in that price range. But we are bringing more: Fiat will be in the same ballpark.”

He added: “For Leapmotor, we are going to position against the other Chinese brands like BYD, Chery. It is the Chinese tool to challenge Chinese car makers in Europe.”