China's Leapmotor set to follow BYD, MG into India; budget EV space set for intense competition

In what is likely to lead to more intense competition in the budget EV space here, Chinese electric vehicle company Leapmotor is giving final touches to its India entry plans, ToI reported on May 6. Leapmotor, which had talks going on with Sajjan Jindal-led JSW, will be following in the footsteps of its Chinese peers

MG and BYD into the country.

According to the ToI report (by Pankaj Doval), Leapmotor will enter India in partnership with the Stellantis group, which recently bought a stake in its global operations. Investment and entry plans will be announced by the company soon, the report said.

The announcement is likely in the next few weeks. ToI said citing a source, "If approved by govt, this will see the launch of budget electric cars developed by Leapmotor into India, intensifying competition in the green cars space."

Stellantis, a leading global automotive manufacturer, operates various brands across multiple continents, including Citroen, Jeep, Chrysler, Peugeot, Fiat, and Maserati. In India, Stellantis is represented by Jeep and Citroen, and it aims to significantly expand its presence by introducing new brands, expanding retail networks, and making substantial investments.

The recent collaboration between Stellantis and Leapmotor on a global scale helps Leapmotor with the confidence to venture into the Indian market, industry people said. Despite stringent regulations on investments from nations sharing a land border with India, this partnership likely emboldens the Chinese company to pursue opportunities in India, they added.

Stringent checks imposed by the government have hindered BYD's expansion in India, as it has faced difficulties obtaining approvals for its investment proposals, even with a local partner. Conversely, MG Motor, a subsidiary of China's SAIC group, was compelled to incorporate an Indian partner. This occurred when Sajjan Jindal's JSW acquired a substantial stake in the company, with plans to increase ownership to 51% in the coming years.

In October last year, Stellantis unveiled intentions to invest $1.6 billion in Leapmotor, securing roughly 20% ownership in the Chinese budget electric vehicle (EV) firm. This move positioned Stellantis as a significant shareholder in Leapmotor.

Additionally, the agreement between the two companies outlined the establishment of Leapmotor International, a joint venture primarily led by Stellantis with a 51% stake, tasked with exclusive rights for the export, sale, and manufacturing of Leapmotor products outside Greater China.

The anticipated entry into the Indian market is expected to be spearheaded by this newly formed export-oriented entity. When approached by TOI, Thierry Koskas, CEO of the Citroen brand and Chief Sales & Marketing Officer for Stellantis, declined to comment on Leapmotor's potential entry into India.