Stellantis NV said Tuesday that a new partnership with Chinese electric vehicle maker Leapmotor will allow it to quickly grow sales in Europe, the Middle East, South America and elsewhere starting later this year.

Stellantis, the transatlantic automaker with brands such as Jeep, Chrysler, Ram, Peugeot and Fiat, will take 51% ownership in the new Leapmotor International joint venture.

Last October the companies announced an initial arrangement that saw Stellantis buy a 21% stake in the Chinese startup, which was founded in 2015 and started selling cars in 2019.

The companies said they plan to "boost scale very quickly," first offering Leapmotor vehicles in September across Europe — in France, Italy, Germany, Netherlands, Spain, Portugal, Belgium Greece, and Romania. Then, by the fourth quarter, the new venture will begin selling the cars in parts of the Middle East and Africa, including Turkey and Israel; in India and the Asia Pacific, including Australia, New Zealand, Thailand and Malaysia; and in South America, including Brazil and Chile.

The aim is to provide more affordable options that can complement Stellantis' current vehicle portfolio, executives said.

Two Leapmotor models will initially be sold under the partnership: the T03, an affordable small hatchback, and the C10, an SUV. More vehicles will fill out the lineup starting next year.

“The creation of Leapmotor International is a great step forward in helping address the urgent global warming issue with state-of-the-art (battery electric) models that will compete with existing Chinese brands in key markets around the world,” Stellantis CEO Carlos Tavares said in a statement. “Leveraging our existing global presence, we will soon be able to offer our customers price competitive and tech-centric electric vehicles that will exceed their expectations."

Zhu Jiangming, Leapmotor's founder, chairman and CEO, said the partnership signals "a new chapter in the global integration of China's intelligent electric vehicle industry,” adding the companies will work well together, given Leapmotor's more affordable products and Stellantis' existing sales channels, service and marketing around the world.

"We believe that this cooperation can give Leapmotor a boost to become a respected world-class intelligent electric vehicle company," the Chinese CEO said.

Stellantis and Leapmotor said they have secured all regulatory approvals for the new joint venture. It will be based in Amsterdam, same as Stellantis, and led by Tianshu Xin, a former Stellantis executive in the China market.

The partnership first began to take shape last October, when the companies announced that Stellantis was investing $1.6 billion ($1.5 billion euro) in Leapmotor, giving it 21% equity in the firm. That deal began to outline the future of Leapmotor International and its plan to both market and produce the vehicles outside China.

Reuters previously reported some Leapmotor T03s will soon be built at a Stellantis plant in Poland, which would make the company among the first Chinese automakers to begin production in Europe.

Tuesday's announcement did not discuss any sales plans for North America.

The deal between Stellantis and Leapmotor comes amid rising concerns about China's growing dominance in the affordable EV space, and how it will affect American car companies seeking to grow their own electric offerings.

Reflecting these concerns, and in an effort to protect the U.S. auto industry, the Biden administration announced Tuesday that tariffs on Chinese EVs would rise to 102.5% from 27.5%.

In China, the Hangzhou-headquartered Leapmotor said it plans to roll out two or three new models each year over the next three years, while at least one new model will come out each year in its other markets covered by the new agreement.

For now, the T03 hatchback will immediately be among the cheapest EV in any market it enters, with its prices in China currently running the equivalent of about $7,000 to $10,000. The C10 SUV in China starts at around $18,000.

Stellantis struggled in the first quarter, reporting late last month that revenues were down 12%, and vehicle shipments were down 10% compared to a year prior. But executives expressed optimism that results would improve as the year went on — both due to a slew of its own new EV and other gas-powered models being released, as well as the new partnership with Leapmotor.

"We've had very positive progress (with Leapmotor) and you will start to see the first sales and revenues coming in there, in the second half," Stellantis Chief Financial Officer Natalie Knight said on an investor call.

She added she did not think that the new partnership would be "hugely material" to Stellantis overall from a financial perspective. But she said there has been major interest from several regions, including the Middle East, Africa and South America, "to get moving" on selling Leapmotor products there, because they are so affordable.

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