Keeping factories busy has become a major challenge for European car manufacturers as the industry moves toward electric vehicles and faces stronger competition.

Stellantis, the company behind brands such as Peugeot, Fiat, Opel, and Citroën, is pursuing a different approach: working with Chinese automotive companies to make better use of existing production facilities.

Making Better Use of Existing Factories

Stellantis chief executive Antonio Filosa has acknowledged that the company has more manufacturing capacity than it currently needs, particularly in Europe. Factories require substantial spending to operate, even when production volumes are below their potential. When facilities remain underused for long periods, the cost of maintaining them can become a significant burden.

This strategy offers an alternative to shutting down facilities that have long served local manufacturing communities. However, its success will depend on whether partner companies can provide enough demand to keep production lines commercially viable. The approach also gives Stellantis more flexibility. Instead of relying entirely on sales from its own brands, it can potentially generate additional factory activity through vehicles developed with other manufacturers.

Why Stellantis Is Working With Leapmotor

One of the company's key collaborations involves Leapmotor, an electric vehicle manufacturer with expertise in developing battery-powered cars. Stellantis has invested in the business and established a joint venture that supports the international distribution and production of Leapmotor vehicles.

The arrangement combines different strengths. Leapmotor contributes vehicle technology and experience in developing electric models, while Stellantis brings established manufacturing facilities, supply-chain capabilities, and access to customers through its international business.

Manufacturing vehicles in Europe could also help the partners serve regional buyers more efficiently. Local production may reduce some logistical challenges and create opportunities to adapt vehicles to customer expectations in different markets.

Spain Becomes an Important Production Center

Spain is central to the companies' plans. At the Zaragoza-area facility, Stellantis and Leapmotor are assessing additional production opportunities that could bring more electric vehicles to the factory. The proposed expansion includes manufacturing Leapmotor's B10 sport utility vehicle and potentially adding a new electric Opel model. The timing and final arrangements for the additional Opel production remain under evaluation, with a possible start in 2028.

Another facility under consideration is Stellantis' Villaverde plant in Madrid. The partnership's plans include assigning future Leapmotor vehicles to the site, potentially helping maintain activity as existing vehicle production changes. A possible transfer of ownership to a Spanish subsidiary of the joint venture has also been discussed.

Battery Production Is Another Priority

Keeping vehicle assembly plants active is only one part of the transition. Electric vehicle production also depends on a dependable supply of batteries and components. Stellantis already has battery manufacturing projects in Europe developed with partners, but Filosa has indicated that further capacity will be needed.

Affordability Will Determine Success

For Stellantis, partnerships must deliver more than additional factory activity. The resulting vehicles also need to attract customers. Electric cars remain a competitive segment in which buyers compare purchase prices, driving range, charging convenience, and everyday practicality. Manufacturers that can offer useful technology at accessible prices may have a better chance of increasing sales.

Sharing components and purchasing resources can help lower development and production expenses. However, cost savings alone cannot guarantee success. Product quality, reliability, customer service, and the strength of each brand will continue to influence buying decisions.

Stellantis is using partnerships to address two connected challenges: underused European factories and the high costs associated with developing competitive electric vehicles. The strategy remains dependent on successful project execution and sufficient customer demand. Still, by combining manufacturing capacity with outside expertise, Stellantis is pursuing a practical way to keep its factories productive while adapting to a rapidly developing automotive market.