Stellantis will invest €130 million to produce Peugeot and Jeep brand EVs at the Wuhan plant.
The European automaker is expanding its alliances with Chinese carmakers to tackle slumping sales and idle capacity.
(A Dongfeng M-Hero model on display at the Beijing Auto Show in April 2026. Image credit: CnEVPost)
Stellantis NV has reached an 8 billion yuan ($1.18 billion) agreement with China’s state-owned Dongfeng Motor to expand the production of Peugeot and Jeep vehicles in China for both domestic and export markets.
The Dongfeng Peugeot Citroën Automobile (DPCA) joint venture is expected to initially produce two all-new Peugeot-branded new energy vehicles (NEVs) at its Wuhan plant starting in 2027, according to a statement on Friday.
The two models will be based on the latest design language of the all-new concept cars unveiled by Peugeot at the 2026 Beijing Auto Show, the statement said.
During the 2026 Beijing Auto Show, Peugeot debuted two global premiere concept cars — the Peugeot Concept 6 and the Peugeot Concept 8.
These products are intended for the Chinese market and for export to global markets as part of Peugeot’s international growth plan, Stellantis said.
The plan also includes the initial production of two Jeep-branded off-road NEVs for global markets at DPCA’s Wuhan plant, starting in 2027.
The project corresponds to a combined investment of over 8 billion yuan, of which Stellantis is expected to contribute about €130 million ($150 million).
Stellantis is a long-standing partner of Dongfeng, with a collaborative relationship spanning 34 years.
Additionally, Stellantis is in separate discussions with Dongfeng about joint production in Europe, according to a Bloomberg report last month.
Representatives of Dongfeng recently visited plants in Germany and Italy to explore the possibility of acquiring or investing in underutilized facilities, according to Bloomberg.
Stellantis CEO Antonio Filosa is trying to revive the group after years of weak sales. The latest deal adds to Stellantis’ expanding network of Chinese partners.
Just last week, Stellantis announced it was deepening its strategic partnership with Leapmotor (HKEX: 9863), covering the expansion of Spanish production capacity and a plant transfer.
The two companies plan to add a new production line at Stellantis’ Zaragoza plant in Spain. The facility, which has produced over 10 million Opel Corsas since 1982, will manufacture a new Opel electric SUV and the Leapmotor B10 in the future.
Stellantis also intends to transfer the ownership of its Villaverde plant in Madrid to Leapmotor International’s Spanish subsidiary. The plant is slated to be allocated a new Leapmotor model for production in the first half of 2028.
Leapmotor has seen strong sales momentum recently, delivering a record 71,387 vehicles in April. The joint venture delivered over 40,000 vehicles in Europe in 2025 and entered the Mexican market in April 2026.
While expanding its alliances, Stellantis is facing severe financial pressure, having recorded a massive net loss of €22.3 billion in 2025.
Huawei, Anhui Jianghuai Automobile Group Corp (JAC), Stellantis, and the European auto giant’s Maserati brand are in talks to jointly develop NEV models for the Maserati brand, according to a report by local media Yunjian Insight earlier this week.
The cooperation model is similar to the five brands under Huawei’s HIMA (Harmony Intelligent Mobility Alliance) business, with the first model expected to enter mass production in the second half of next year, the report said.
Idle capacity in Europe has also attracted the attention of other Chinese automakers. BYD (HKEX: 1211) is in talks with Stellantis and other carmakers to take over underutilized European plants.
BYD executive vice president Stella Li said on the sidelines of the Financial Times Future of the Car summit in London that the company prefers to operate plants independently.
In addition, Chinese luxury auto brand FAW Hongqi is in negotiations with Stellantis. Hongqi plans to use the latter’s Zaragoza plant in Spain for localized production to accelerate its European expansion, according to a Reuters report on April 28.
The undisclosed talks were brokered by Leapmotor. FAW Group invested in Leapmotor last year to acquire a 5% stake, and this collaboration will help Hongqi save hundreds of millions of dollars and achieve its plan to launch over 15 models in Europe by 2028.
BYD prefers to operate the factories independently rather than through joint ventures.
($1 = 6.7959 yuan)