Stellantis (EPA:STLAM) confirmed Wednesday that the automaker was studying closer ties with Chinese carmakers following a Bloomberg report that said the company was nearing a deal to acquire a roughly 20% stake in Chinese electric vehicle company, Zhejiang Leapmotor (HK:9863).
Leapmotor and Stellantis are in talks about establishing a collaborative venture as a component of the deal, according to sources familiar with the matter cited in the Bloomberg report. The collaboration, if realized, could enable Stellantis to produce and market a selection of Leapmotor vehicles in regions beyond China.
The proposed partnership would also grant Stellantis access to Leapmotor's components and certain technologies in the electric vehicle sector, as stated in the report.
Stellantis, known for its brands like Fiat and Peugeot (EPA:PEUG), has a limited foothold in China. The company, alongside competitors like Renault (EPA:RENA), are concerned over rising competition caused by affordable Chinese electric cars in the European market.
Stellantis said in a statement that it had previously announced the company was "studying scenarios to seize business opportunities linked to the dynamics of Chinese manufacturers in the context of the electrification of the global automobile market."
According to Bloomberg reports, the two companies are refining the final details of the deal, and an announcement should be made soon.
Stellantis is due to publish its third quarter revenue figures next Tuesday.