On 26th October, Stellantis Group and Leapmotor officially announced their partnership, in which Stellantis will invest about 1.5 billion euros to acquire a 20% stake in Leapmotor, becoming the latter's majority shareholder and gaining two seats on Leapmotor's board of directors. At the same time, Stellantis and Leapmotor will set up a 51:49 joint venture called Leapmotor International. The joint venture will have the exclusive right to export and sell to all markets in the world except Greater China, as well as the exclusive right to manufacture Leapmotor products locally. The CEO of the joint venture will be appointed by Stellantis Group.
01 Each Takes What It Needs and Lays Out Overseas
First of all, it should be noted that Stellantis and Zeropeng have similarities with Volkswagen and Xiaopeng in that they both use capital injection to acquire technology, but the target markets are different.While Volkswagen Group has joined hands with Xiaopeng to go further in China, its number one single global market, Stellantis' current situation in China is clear for all to see, and so it has focused its partnership on international markets outside of China, emphasising that "the Stellantis Group will continue to work on the implementation of its asset-light business model in China for its brands in China." From the co-operation agreement, we can see that the two sides have their own needs: Stellantis needs to make use of Zero Run Auto's electrification and intelligent technology to achieve its product transformation and layout on a global scale. Zero Run Auto, on the other hand, can rely on Stellantis' mature business layout in overseas markets to vigorously promote the sales of the Zero Run Auto brand in local markets, "which will first start from the European market". The official statement noted that the "Zero Run International" joint venture is expected to begin export operations in the second half of 2024. After all, although Stellantis has not performed well in China, it has deep roots in Europe and North America, especially in the European market, which has been favoured by Chinese automakers in recent years. With Stellantis as a backing, Zero Run Auto's road to Europe will obviously be a little smoother. In September this year, Zero Run Auto participated in the Munich Motor Show, showcasing its first global model, the C10, and announcing that in the next two years it will launch five globalised products for simultaneous sales in Europe, Asia Pacific, the Middle East and the Americas. These businesses will probably be handled by the joint venture company "Zero Run International" in the future. What's more, from the agreement, "Zero Run International" can manufacture Zero Run products in overseas markets. This means that Zero Run may not only enter Europe by way of export in the future, but also may take a step ahead of many Chinese counterparts to realise localised production in Europe. Or build new factories, or directly use Stellantis production network in Europe, either way, there are deep-rooted in Europe Stellantis in, will be more smooth than zero run car alone. As for Stellantis, it is in dire need of advanced electrification and intelligent technology to help it transform. As the world's fourth-largest auto group, Stellantis was formed by the merger of Peugeot Citroen and Fiat Chrysler, and has 14 car brands under its belt. Compared with its rivals, Stellantis has been determined but slow to make progress in electrification. In the first half of this year, Stellantis sold 169,000 all-electric vehicles, accounting for only about 5 per cent of its global sales. At the same time, Stellantis has an ambitious "Dare Forward 2030" strategic plan that sets the goal that by 2030, all of the group's passenger cars sold in Europe will be purely electric, and 50 per cent of its passenger cars and light trucks sold in the United States will be purely electric. Under these circumstances, Stellantis is in urgent need of external advanced technology support, and Zerodan Motors is an ideal partner. Currently, Zero Run Auto is in the first tier of China's New Car-making forces. In the next three years, Zero Run Auto will be based on a technical architecture, three vehicle platforms, to create A-class to E-class "pure electric + range-extended dual-power" intelligent cars. "Zero Run Auto is the world's first new energy automotive company to adopt CTC battery chassis integration technology in a production model, and the 'four-leaf clover' centrally centralised electronic and electrical architecture launched this year realises seamless and efficient collaboration between the core components of an intelligent Electric Vehicle. Thanks to the full range of self-research and vertical integration capabilities that Zero Run Automotive possesses, the company can maximise its ability to quickly launch competitive products that adapt to market changes." Stellantis said in a statement. It can be seen that the technical strength of Zero Run Auto, especially the "four-leaf clover" architecture, is an important reason for Stellantis to choose it as a partner. In terms of funding, the rich and powerful Stellantis Group is simply "not bad money". Although China is going downhill, but there are two major pillars of profit in Europe and North America, Stellantis is still "day in and day out", the first half of this year's net profit of up to 10.9 billion euros. Stellantis also plans to invest more than 50 billion euros in the field of electrification in the next ten years, for the zero-run car's investment naturally not a big deal. How big a deal.
02 Reverse joint venture wave opens
For Zero Run Auto, Stellantis's capital injection has a great boosting effect.Externally, the cooperation between the two parties mainly focuses on the international market, so that Zero Run Auto's internationalisation road can go smoother.Internally, Stellantis' capital injection and cooperation is a recognition of Zerodan's technical strength, which will help it increase sales and will undoubtedly result in a more adequate cash flow.Cash flow is very important for a new car-making forces. 17 October Zero Run Auto has just announced the third quarter financial results, single quarter gross profit margin for the first time turned positive to 1.2%, which is undoubtedly a good news, but behind the scenes, the Zero Run Auto loss is still the same, the third quarter operating loss of 1.025 billion yuan, while the first half of the net loss of 2.276 billion yuan.At the time, Dolphin Investment Research said, "Although Zero Run's operating cash flow turned positive for the second time in the third quarter, but according to the real rate of cash consumption measurement, if there is no continued financing, the time left for Zero Run may be just over a year or so."Against this background, Stellantis' capital injection is undoubtedly timely rain for Zero Run.At present, under the wave of electrification and intelligent development, the cooperation model of "market for technology" that lasted for many years has basically been declared over, and Chinese companies have started to export technology in the reverse direction, and there are constantly new joint ventures coming out.For example, Volkswagen Group and Xiaopeng Automobile, Volkswagen Group and Horizon.In contrast to these collaborations, which are focused on the Chinese domestic market, Stellantis' partnership with Zero Run Automotive has a global perspective.
"The establishment of a global partnership between the two parties will be an industry first, i.e., a world-leading automaker and a new powerhouse EV company from China collaborating on a global EV project." Both parties noted in a statement.
It is worth noting that this is also an attempt to zero running car new business model.At the end of July this year, when the "four-leaf clover" structure was released, Zhu Jiangming, founder and CEO of Zero Run Automobile, announced that Zero Run Automobile would learn to "walk on two legs", saying, "Zero Run is not only going to be an automobile company, but also a company that exports technology. technology export company." In addition to selling cars, external technology will become the second growth curve of Zero Run Auto, and the cooperation with Stellantis may become an example.
