Update April 6, 2026, at 10:04 a.m. ET: Industry Minister Mélanie Joly rejected Stellantis’ proposal to assemble EVs with kits from China at the Brampton, Ont. plant, saying instead that that plant “needs to support the local supply chain.”
The original story follows below.
Big three automaker Stellantis is discussing options to potentially build electric vehicles (EVs) in Canada with Chinese partner Zhejiang Leapmotor Technology, potentially at an idle plant in Ontario.
The Canadian discussions are focused on the idled Stellantis plant in Brampton, where thousands of workers were laid off when the automaker shifted production of the Jeep Compass to the Belvidere Assembly Plant in Illinois.
This decision “prompted fury from Carney’s government,” according to Bloomberg, which threatened to withdraw millions of dollars in taxpayer-backed subsidies from Stellantis.
However, discussions with Industry Minister Melanie Joly now include the possibility of manufacturing cars with Leapmotor. Stellantis purchased a 20 per cent stake in Leapmotor in 2023, and later formed a joint venture called Leapmotor International.
Globally, the joint venture plans to begin building Leapmotor electric SUVs later this year at a Stellantis facility in Spain, with EV production also planned in Brazil and Malaysia. Those projects will mainly rely on “knockdown kits,” in which the cars are largely built in one country and shipped overseas for final assembly.
However, this strategy may not be what Stellantis does if it brings Leapmotor to Canada. According to Bloomberg, there will be delicate negotiations with both labour unions and parts suppliers that are wary of Leapmotor and other Chinese firms entering the Canadian auto sector.
“Chinese knockdown kits may be fine for Brazil, but they aren’t for the hundreds of Canadian auto parts suppliers who are waiting for the plant to reopen,” says Flavio Volpe, president, Automotive Parts Manufacturers’ Association, through text with Bloomberg. “We don’t need a bad deal, and we shouldn’t settle for one.”
The talks are currently in an early stage, and if the companies proceed, it would be the first major Chinese auto investment in Canada since the initial agreement to bring Chinese EVs to Canada was reached in January.
Source: Bloomberg
Image Credit: Shutterstock
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