(Yicai) May 15 — Stellantis and long-time Chinese partner Dongfeng Motor Group have signed an CNY8 billion (USD1.2 billion) investment deal to localize the production of electric vehicles for Peugeot and Jeep, in a move aimed at lifting sales of the two brands in China.

Dongfeng Peugeot Citroën Automobile, the joint venture of Stellantis and Dongfeng Motor, is expected to initially produce two new Peugeot and two new Jeep off-road electric models from next year at its plant in Wuhan, the Amsterdam-based auto giant announced today. The EVs will be sold both in China and overseas.

Stellantis will contribute about EUR130 million (USD151.4 million) to the project, which will benefit from favorable industrial policies in Hubei province and Wuhan, the provincial capital, it noted.

“With a track record of more than 30 years of collaboration and shared automotive expertise, Stellantis and Dongfeng Motor are ready to further leverage their strengths and introduce all-new vehicles with cutting-edge EV technologies from brands that customers worldwide trust and love,” said Antonio Filosa, chief executive of Stellantis.

“Dongfeng Motor has always taken the transformation and revitalization of Dongfeng Peugeot Citroën Automobile as a key strategic priority, fully supporting and advancing its sustainable development,” noted Chairman Yang Qing.

“Through the signing of this strategic cooperation, by integrating Hubei’s industrial strengths, Stellantis’ global layout advantages, and Dongfeng’s intelligent electric vehicle technologies, a new path featuring complementary strengths and win-win outcomes for all parties has been forged,” Yang said, adding that the move will inject strong momentum into the JV’s transformation.

In recent years, Stellantis’ business in China has faced difficulties as local rivals have quickly emerged. Dongfeng Peugeot Citroën, its sole remaining JV in the country, sold just 51,507 vehicles last year, down 25 percent from a year earlier and more than 90 percent below its peak a decade ago.

Stellantis had another Chinese JV, GAC Fiat Chrysler, which entered bankruptcy and liquidation proceedings and discontinued operations in 2022. The local production of Jeep vehicles by the JV was also terminated, with the brand switching to an import business model in the country.

Editor: Martin Kadiev