China's Leapmotor to build EVs at Stellantis' Polish plant, sources say

Leapmotor electric vehicles (EVs) will be built at partner Stellantis' Tychy plant in Poland, two people close to the matter told Reuters on Friday, making it one of the first Chinese carmakers to start production in Europe.

Output of Leapmotor's T03 small electric car could start before the end of June using the semi-knocked down technique involving turning partially assembled kits into finished vehicles, one of the people said.

Stellantis chose the site for its partner as part of a joint venture they agreed last year.

Tychy will ensure low costs for a product designed to be affordable for a broad range of customers, the second source said. Both sources declined to be identified because the details are not yet public.

A Stellantis spokesperson declined to comment. Leapmotor representatives could not reached for immediate comment.

With a range of 280km, the T03 is already being imported into some European markets, including France, with prices starting at about €20,000 (R410,362).

The model offers to help Stellantis boost its low-cost EV offerings and compete with Renault's Dacia Spring and BYD's Seagull.

Leapmotor told Reuters this month the joint venture's executive team is in place and sales of another model, the C10 SUV, the first Leapmotor EV designed specifically for overseas markets, will start soon in Germany, France, Italy and Spain.

Chinese carmakers are bringing a number of lower cost EV models to Europe, which has spurred a race by legacy European carmakers to develop more affordable EVs.

Trade tensions are running high between China and the EU, which is investigating whether Chinese EV makers benefit from unfair government subsidies.

Chinese manufacturers are also looking to build assembly plants in Europe. BYD has announced it will build a plant in Hungary, while rival Chery Auto is assessing options for a similar investment, including possibly in Italy and Spain.

Stellantis said last year it was buying a 21% stake in Leapmotor in a $1.6bn (R30.35bn) deal that would give it a fresh shot at China, the world's biggest car market by sales.

As part of the deal the two carmakers also announced a joint venture, giving Stellantis exclusive rights to build, export and sell Leapmotor products outside China, a first for a legacy Western carmaker.

A Chinese regulator this month approved the joint venture in which Stellantis has a 51% stake.

Media reports earlier this year said Stellantis was considering its Mirafiori complex in Turin, Italy, as a base for Leapmotor's European production, with a targeted annual output of 150,000 cars.

In the south of Poland, Tychy is a historic Fiat facility. The plant makes several Stellantis vehicles, including petrol and hybrid versions of the Fiat 500, the Fiat 600, the Jeep Avenger and the new Alfa Romeo Milano, scheduled to be unveiled next month.