Chinese Hongqi plans production in Europe via Stellantis
Chinese brand Hongqi, known for its luxury cars, is in negotiations with the Stellantis group to organize the assembly of its vehicles in Spain. According to sources, these discussions may be taking place through the joint venture Leapmotor, adding complexity to the situation. It is worth noting that Stellantis owns a 20% stake in Leapmotor, while Hongqi’s parent company, FAW Group, holds 5%.
More on this: The most luxurious Chinese brand is preparing 15 new models for Europe.
Why this matters for Hongqi
Specific details of the deal have not been disclosed yet, but according to Reuters, these negotiations could significantly accelerate Hongqi’s European expansion. The company plans to launch over a dozen electric and hybrid models in the region by 2028. Manufacturing in Europe would allow the brand to avoid the significant costs of building a new plant, which could reach hundreds of millions of dollars, as well as bypass high tariffs on imported vehicles.
Reaction from the parties and other negotiations
All three automakers are currently refraining from commenting. A Stellantis representative only noted that the company is in discussions with various market players around the world, always aiming to provide customers with the best mobility options.
Whether these negotiations will lead to concrete results remains to be seen. However, Stellantis is rumored to be in talks with several Chinese companies simultaneously. Recently, information emerged about a potential partnership with Dongfeng, which could provide the Chinese company with access to Stellantis’s underutilized plants in Europe. Representatives from Dongfeng even visited factories in Italy and Germany.
Other potential Stellantis partners
Besides Hongqi and Dongfeng, Stellantis is also discussing collaboration with Xpeng and Xiaomi. Such a large number of negotiations may indicate that the Dutch conglomerate is collecting proposals to choose the most advantageous option for itself.
History of Hongqi and future plans
Hongqi was founded in China in 1958 and became the first car produced independently in the country. The brand quickly gained favor with high-ranking officials, including Mao Zedong, who considered it a symbol of national pride at a time when the country was still largely dependent on Soviet limousines.
Recently, the luxury brand has been actively eyeing the European market. Hongqi is already present in several countries and plans to open over 200 dealerships across Europe by 2028.
Such a move by Hongqi and other Chinese manufacturers signals a strategic desire not just to export cars, but to integrate into the European manufacturing ecosystem. This allows them not only to avoid trade barriers but also to reduce logistics costs and respond more quickly to the needs of the local market. For Stellantis, which has excess production capacity in Europe, such a partnership could be a way to keep its factories busy and gain access to advanced Chinese technologies in the electric vehicle sector. At the same time, this creates new competitive dynamics in a market where traditional European players are already feeling pressure from Chinese brands.