Stellantis explores Chinese EV production in Canada with Leapmotor – report

Stellantis is in early talks with China’s Leapmotor about building electric vehicles at its underused plant in Canada, indicating a potential Chinese automotive investment in Canada following recent tariff adjustments.

According to a Bloomberg report, the talks centre on the Brampton plant near Toronto, where around 3,000 unionised workers have been laid off for several years.

The facility had earlier been slated to manufacture a new Jeep sport-utility vehicle, but those plans were abandoned after US tariffs on foreign-made vehicles prompted a relocation of production to a US site.

The potential collaboration follows a January agreement between Canadian Prime Minister Mark Carney and Chinese President Xi Jinping to reduce tariffs on Chinese-built EVs and encourage joint-venture investments in Canada’s automotive sector over a three-year period.

Stellantis and Leapmotor already have an established relationship.

In 2023, Stellantis acquired a 20% stake in the Chinese electric vehicle company, after which both firms formed Leapmotor International, a joint venture aimed at expanding EV manufacturing and sales globally.

The joint venture is expected to begin producing Leapmotor electric SUVs in Spain later this year.

Additional projects are planned in Brazil and Malaysia, initially using knockdown kits shipped from China for local assembly.

In Canada, however, discussions remain at an early stage, with no confirmed structure or terms for any potential partnership.

Canadian Industry Minister Melanie Joly has previously signalled support for Chinese investments structured as joint ventures that incorporate domestic components and software.

In a statement to the news agency, the company said: “Stellantis remains focused on a strong Canadian footprint and is actively evaluating future programs for Brampton, with the objective to ensure that any investment decision is sustainable and a long-term commitment that supports workers and suppliers.”

The talks come amid broader disruption in the North American automotive industry following tariffs introduced by US President Donald Trump on imported vehicles.

These measures have prompted shifts in production strategies and heightened concerns around supply chain integration.

US officials have warned Canada about possible retaliatory action if the country becomes a gateway for Chinese-built vehicles entering the US market.

In January, Trump threatened to impose tariffs of up to 100% on Canadian goods if Ottawa deepens its automotive ties with China.

No final decisions have been made regarding the future of the Brampton facility, and discussions between Stellantis and Canadian authorities are ongoing.