In a tough automotive industry, Stellantis is facing challenges. As we recently reported, the company’s profits fell 70% in 2024, and its outspoken CEO Carlos Tavares quit at the end of the year.  Although many traditional automakers have found the shift to electrification disruptive, Stellant is seems to have particularly struggled to negotiate the new market. Now there’s yet another brand being added to its huge portfolio that promises more electric options, but it’s a bit different from the rest. Could Leapmotor be the Stellantis marque that turns the multinational behemoth’s fortunes around?  Leapmotor joins the other 14 members of the Stellantis group (although only eight are active in Europe). The Stellantis name was born when PSA Group (which combined Peugeot, Citroen, Vauxhall/Opel, and DS) merged with Fiat Chrysler Automobiles (Abarth, Alfa Romeo, Fiat, Lancia, Chrysler, Dodge, Jeep and Ram). But all these brands are fully owned by Stellantis. Leapmotor is a Chinese company, which has been operating in its home country since 2015. Stellantis purchased 20% of the business in China in 2023, but now also owns 51% of the Leapmotor International wing that was launched in Europe in 2024 to bring the brand to a global market. Why Leapmotor? From one perspective, it’s valid to ask why Stellantis needs yet another brand. But Leapmotor potentially plugs a gap like nothing else in its portfolio. When the current battery-electric (BEV) transition started around 2020, Stellantis appeared to have mostly one drivetrain on offer. This combined a 136hp motor driving a vehicle’s front wheels with a 50kWh battery. It appeared in everything from compact hatchbacks like the Peugeot e-208 all the way up to sizeable vans like the Citroen e-Dispatch (although some vans did offer larger batteries). From one perspective, it’s valid to ask why Stellantis needs yet another brand. But Leapmotor potentially plugs a gap like nothing else in its portfolio. The results weren’t terrible, and neither were the prices (by BEV standards), but they were platforms shared with internal combustion engine (ICE) versions. This meant they missed out on some of the benefits from design innovations that pure-BEV platforms make possible, such as larger under-floor batteries for lots of range, dual-motor performance, and increased interior space. More recently, the company has developed more advanced EV drivetrains, such as STLA Small and Medium. These have been presented as being intended specifically for BEVs, but they do still support ICE. They are more “BEV first” than pure BEV, but that is still a considerable improvement over the compromised prior platforms. This has allowed new models like the Peugeot e-3008 to offer more competitive features than previous Stellantis EVs, such as much larger batteries capable of over 400 miles of range. The technology stack also feels much more seamlessly integrated into the car. However, the vehicles built on these new Stellantis platforms still exhibit a continuing problem for most European carmakers – they remain relatively expensive. That’s not a disaster when most automakers have the same issue with BEV pricing. But now that Korean and Chinese brands are starting to offer strong competition in Europe, the EV market is becoming increasingly cramped and price-sensitive, making it hard to stand out. For example, Chinese automaker BYD is posing a considerable challenge, and in the U.K. MG has been expanding electric possibilities. Stellantis’ incumbent advantage However, while challenger brands can tempt with very compelling pricing, they often lack the support network to continue the good experience after sales. What Stellantis is hoping is that there is a powerful synergy between what it has to offer as a traditional incumbent automaker–a well-established network of dealerships and service centers–and what Chinese brands can provide. These days, that’s not just low costs, but also advanced technology. The Leapmotor cars arriving in Europe boast innovative BEV features, and they have plenty of leading-edge safety tech built in as standard too. However, price is still a key feature of the Leapmotor offering. The most market-challenging model among the first two launched in Europe is the T03, a small four-door hatchback. The T03 is arriving in Britain at £15,995 ($20,500). By EV standards that’s a bargain. The Dacia Spring starts at £14,995 ($19,500), but that’s without an infotainment screen, which the T03 has as standard. The Spring also has a smaller battery (meaning less range) and a less powerful motor. Leapmotor aims to match the Spring on price but surpass on EV features and quality. The story is similar with the other car Leapmotor has launched in Europe so far - the C10. At first glance, this looks a lot more “me too” than the T03. It’s a mid-sized electric SUV costing £36,500 ($47,000), and there are a lot of competitors from other brands around this price. However, Leapmotor only offers one premium-grade trim level for the C10, like the T03, with features like a panoramic sunroof, a heat-pump (improving winter range), heated and ventilated front seats, and a kick-to-open tailgate as standard. Other brands charge a lot more once you add these kinds of luxuries. The C10 has initially been launched as a BEV with 263 miles of WLTP range, but a “serial hybrid” is also imminent. Bracing for the Chinese automotive invasion The Leapmotor venture isn’t just an excuse for Stellantis to import cheap cars made in China, however. The cheapest model, the T03, is made in Tychy in Poland, so should be resistant to the global trade war that is evolving daily. The C10 is imported from China, but the next model to be released, the B10, will be built in Slovakia and Germany. Three more models will be introduced by the end of 2027. Leapmotor aims to continue its ethos of offering premium features for keen prices with these launches. There is an increasing array of quality Chinese or Chinese-owned EV brands entering the European market, including XPENG and Geely-owned marques ZEEKR and Lynk & Co. Geely is also the force behind Swedish Volvo and Polestar. Changan (which has Ford and Mazda joint ventures) is another Chinese brand just about to enter Europe. The challenges for European automakers are only set to increase. Even though tariffs might temporarily protect European brands at home, they can’t make them competitive on the global market against the Chinese. Stellantis appears to have adopted a policy more of “if you can’t beat them, join them” with its Leapmotor International strategy. The prices are competitive but for a more premium specification than alternatives, giving the cars a potential edge. This might not be enough to reverse the 70% fall in profits from 2024 entirely, but it could certainly help keep Stellantis in the game as Europe increasingly electrifies. This story was originally featured on Fortune.com ...read more read less