Stellantis and Leapmotor abandon Polish EV production plans

Stellantis and its Chinese partner Leapmotor have abandoned plans to manufacture their second electric vehicle model at Stellantis's Polish facility, according to two sources familiar with the matter.

The joint venture is now evaluating alternative production locations for the B10 electric crossover, including Stellantis's Opel factory in Eisenach, Germany, and its Trnava plant in Slovakia. This strategic pivot comes in the wake of Chinese government pressure on domestic automakers to reconsider investments in EU countries that supported recent tariffs on Chinese-made EVs.

The decision follows a crucial October 10 meeting where China's Ministry of Commerce reportedly instructed Chinese automakers to halt major investment plans in EU nations that backed the tariff proposal. Just four days after this meeting, both companies showcased the B10 EV at the Paris Motor Show, celebrating it as a milestone in their partnership, despite the brewing tensions behind the scenes.

The situation highlights the complex interplay between trade policy and automotive manufacturing strategies. Poland, along with nine other EU members, supported the implementation of tariffs up to 45% on imported Chinese-made EVs. In contrast, Germany and Slovakia, now under consideration as alternative production sites, were among the five EU members that opposed these tariffs, which took effect on October 30.

Currently, Stellantis's Tychy plant in Poland manufactures the T03 compact EV using components shipped from China. The status of this existing production arrangement remains unclear, as does any potential impact on employment at the facility. Sources indicate that while Germany is being considered as an alternative location, it would involve higher operational costs due to increased utility and labour expenses.

The B10 represents a crucial element in Leapmotor’s international expansion strategy, being the first of its B series EVs designed specifically for markets outside China. The company began its European sales operations in September, marking a significant step in its global ambitions. Stellantis CEO Carlos Tavares had previously positioned the partnership with Leapmotor and the B10 project as key to delivering "high-tech, affordable" EVs to consumers beyond China's borders.

The joint venture structure, with Stellantis holding a 51% stake and Leapmotor controlling the remaining 49% through Leapmotor International, underscores the significance of this collaboration for both parties. Under Chinese regulations, companies must obtain Beijing's approval for overseas direct investments, adding another layer of complexity to international manufacturing decisions.

Neither Stellantis nor Leapmotor have officially commented on the production site change, and representatives from the Chinese government, including the State Council Information Office and Ministry of Commerce, have not responded to requests for comment. Similarly, the Polish industry ministry, German and Slovak governments, and Opel have yet to provide official statements on the matter.