Stellantis NV STLA shares are trading lower premarket on Friday.
Stellantis, in response to new tariffs on electric vehicles (EVs) by the European Union, is considering relocating the production of some Leapmotor models from China to Europe, aimed at mitigating the potential financial impact of increased import costs.
Carlos Tavares, CEO of Stellantis, highlighted that the company might expedite the assembly transfer of certain Leapmotor vehicles to their European factories, a move discussed as early as last month due to growing global trade tensions, reported Bloomberg.
The European Union has recently informed automakers, including BYD Company BYDDY, Geely Automobile Holding GELYY, and SAIC Motor Corp, of additional levies on EV imports following a probe that concluded that these manufacturers benefited from state subsidies in violation of trade rules.
This development has not only led to stringent financial measures but also elicited a strong reaction from China, which may result in retaliatory actions.
Under the new regulations, BYD will face an additional 17.4% tariff, and SAIC will endure a staggering 38.1% rate, on top of the existing 10% charge.
Also Read: Tesla Warns Of Model 3 Price Hike In EU Due To Tariffs
These levies vary based on each manufacturer’s cooperation with the EU investigation, affecting other carmakers with a weighted average rate.
The EU's provisional duties are set to commence on July 4, with official implementation in November.
Stellantis previously mentioned that its facility in Tychy, Poland, known for producing the Jeep Avenger, could potentially become a production site for Leapmotor vehicles, aligning with the company's broader strategy to adapt to global market changes and regulatory environments.
On Thursday, Stellantis confirmed its 2024 guidance of double-digit Adjusted Operating Income (AOI) margin, positive industrial free cash flows, and a capital return plan of at least 7.7 billion euros through dividends and buybacks.
STLA Price Action: STLA shares are down 4.13% at $20.21 at last check Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Read Next: Volkswagen’s Audi Partners With SAIC For New EV Platform In China
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