China’s FAW Group-owned brand Hongqi is in discussions with Stellantis regarding possible vehicle production at one of Stellantis’ plants in Spain, according to a Reuters report citing multiple sources familiar with the matter.
The outcome of the discussions remains unclear. Reuters said it spoke with five sources, but none of the companies involved confirmed the talks. Hongqi, FAW, and Leapmotor did not respond to requests for comment, while Stellantis declined to comment.
Leapmotor is also reported to be involved in the discussions in a potential intermediary capacity. Both Stellantis and FAW are shareholders in Leapmotor, with Stellantis holding the largest stake. Leapmotor is currently establishing a supply chain in Spain to support production at Stellantis’ Zaragoza plant, which could be used by other partners if agreements are reached.
The reported talks come as Stellantis evaluates options to utilize its European manufacturing capacity. In addition to its partnership with Leapmotor, previous reports have linked the company to discussions with Chinese automakers including Xpeng, Xiaomi, and Dongfeng Motor. Hongqi, historically associated with state vehicles in China, is among several Chinese manufacturers, including Changan Automobile, expanding their presence in overseas markets.
In an earlier statement to Bloomberg regarding similar discussions, Stellantis said: “As part of its normal course of business, Stellantis holds discussions with a range of industry players around the world on various topics, always with the ultimate aim of providing customers with the best mobility choices.”
Using existing European production facilities could allow Chinese automakers to access established supplier networks and logistics systems, while potentially reducing exposure to European Union tariffs on imported battery-electric vehicles. Some companies have adopted alternative approaches, such as contract manufacturing or building dedicated facilities in Europe.
Hongqi has outlined plans to expand internationally, targeting annual sales of one million vehicles by 2030, with at least 10% expected to come from markets outside China, according to sources cited by Reuters. Production in Spain, if agreed, would represent its first manufacturing presence in Western Europe.
The company is also reported to be considering Hong Kong as a potential production location, which could offer lower export tariffs compared to mainland China. No final decision has been made, according to the report.
Hongqi has been broadening its product lineup beyond its traditional focus on official state vehicles. The company said previously it plans to introduce 15 electric and hybrid models in Europe by 2028 across multiple markets, including the EHS5 compact electric SUV.
Leapmotor’s involvement could extend beyond mediation. The two companies reached an agreement last year for Leapmotor to supply an electric vehicle platform to Hongqi. Stellantis, which distributes Leapmotor vehicles outside China, is also preparing to begin production of Leapmotor models at its Zaragoza plant later this year. Reuters reported that Hongqi vehicles could also be produced at the same facility.
Separately, Reuters reported earlier this month that Stellantis is in advanced discussions with Leapmotor to jointly develop an electric SUV for Opel using Leapmotor technology, with production planned in Zaragoza.