Multinational automotive manufacturing corporation Stellantis announced it is buying a 21% stake in Chinese electric vehicle (EV) manufacturer Leapmotor in a $1.6bn deal.
As legacy car manufacturers make the change to EVs, Stellantis is looking to secure access to the Chinese automotive sector and update its own manufacturing tools.
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Research from GlobalData’s Thematic Report: Electric Vehicles found that China has aimed to make neighbourhood electric vehicles (NEVs) account for 25% of its auto sales by 2025. The country accounted for nearly 38% of global EV sales in 2020, reflecting China’s position as the most populous country and the one with the highest demand for transportation.
Chinese EV manufacturers such as Tesla’s rival BYD benefit from robust domestic lithium-ion battery production and government subsidies.
A conglomerate that specialises in technology for transport, renewable energy and electronics, BYD recently made a series of strategic deals with companies to expand its sales and manufacturing worldwide.
In July, BYD announced it would increase the production to 100,000 EVs in India over the following few years.
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By GlobalDataEarlier this year, BYD signed dealerships with the UK and within the EU to expand its sales capacity.
Sales of BYD new energy vehicles close to doubled in June 2023 from the year before to 253,046, according to Forbes. The first half of 2023 saw the company’s shipments close to double reaching 1.2 million, the publication reported.
Data from the China Passenger Car Association (CPCA) shows China’s auto exports increased 31% in August as Chinese EV manufacturers such as BYD and Nio seek to diversify by expanding overseas amid growing domestic competition.
European legacy manufacturers are concerned about emerging competition from Chinese EVs.
The European Commission (EC) launched an anti-subsidy investigation in September to determine whether to impose punitive tariffs on cheaper Chinese electric vehicle imports which are threatening European Union manufacturers.
The EC will evaluate, for up to 13 months, whether to levy tariffs above the current EU standard for cars of 10%.
“Global markets are now flooded with cheaper Chinese electric cars. And their price is kept artificially low by huge state subsidies. This is distorting our market,” EC president Ursula von der Leyen said in her annual address.
