FAW takes a 5 percent stake in Leapmotor for 450 million euros

The Chinese state-owned automotive group FAW has just formalized a major investment in the Chinese private electric vehicle maker Leapmotor. In exchange for a 5 percent stake in the latter, FAW has paid 3.74 billion yuan, which at the current exchange rate amounts to just over 450 million euros. In this way, FAW consolidates an alliance aimed at strengthening the position of both companies in a market as competitive as electric mobility.

Stellantis remains the largest individual shareholder in Leapmotor with nearly 19 percent, to be exact, 18.99 percent. Although it is true that this transaction has slightly reduced that percentage from the 20 percent it held until now.

The collaboration between FAW and Leapmotor is not new, so it should come as no surprise to anyone. Since last spring both companies have been working together on the joint development of a new vehicle, and rumors of a possible entry of FAW into the capital of Leapmotor already emerged last summer, gaining strength in early December.

What lies behind this operation?

From a strategic standpoint, this move can be interpreted as an initial step toward the restructuring of the Chinese automotive sector, where more than a hundred brands coexist amid an intense price war. The Chinese government wants to moderate this competition, introducing various regulatory measures to that end, as well as favoring alliances that drive efficiency and innovation.

Economically, this investment appears very positive for FAW, as Leapmotor is achieving impressive growth quarter after quarter. In 2025 the company closed the year with 596,555 vehicles delivered, representing an increase of 103.1 percent over the previous year.

The founder and CEO of Leapmotor, Zhu Jiangming, has set truly ambitious goals for the company he leads, including reaching one million units sold in 2026 and reaching 4 million annually within the next decade. With affordable models that integrate advanced technology, the company positions itself as one of the most dynamic players in the electric mobility sector in China.