The relationship between Stellantis and the surge of Chinese vehicles in Europe has shifted noticeably. Just over a year ago, the group’s chief executive officer, Carlos Tavares, indicated in interviews with multiple European outlets that a kind of “red carpet” was laid out for Chinese cars on the continent, and the industry awaited tariff parity with Chinese imports. The narrative has since evolved. Tavares has pulled back from calls for higher tariffs, acknowledging a broader investigation by the European Commission into possible state subsidies for eastern manufacturers, amid concerns about an uneven playing field.
The Portuguese executive urged Europe to position itself on the winning side in what he calls the most challenging competition the automotive sector has faced. This has driven Stellantis to invest in Leapmotor and to partner with battery leader CATL. Yet he stresses that more is needed. The Vigo facility is selective about cost structures, aiming to align more closely with Chinese competitors, and the company is pursuing components sourced from Eastern Europe, Morocco, and Asia. He warns that Europe is not ready to embrace rapid change and accuses the region of merely pretending to undergo transformation.
In exclusive remarks to a German publication, Der Spiegel, published ahead of the signing of a memorandum of understanding with CATL and following Stellantis’ $1.5 billion investment in Leapmotor, Tavares did not hold back. He confronted the paradox of criticizing the influx of Chinese cars while simultaneously integrating Chinese components and selling the group’s models as its fifteenth brand in Europe, arguing that agility in China has forced a rethinking of strategic directions.
Asked about this contradiction, Tavares defended a more adaptable strategy, recounting how the company had to respond quickly in China and adjust its approach to the European market. He reiterated concerns about the European Commission’s stance on combustion-engine bans after 2035, describing the veto as dogmatic and insufficiently aligned with reality. He suggested that the bloc is over-reliant on a single, costly technology that many customers cannot afford, stressing that producers face elevated costs in the shift toward zero-emission mobility.
Despite confirming Stellantis’ intention to endure this conflict, the executive outlined a plan to aggressively reduce costs by embracing a model more akin to Chinese practices. He noted that Chinese rivals enjoy a multi-year lead in electric mobility and argued for a decisive response to bridge the gap more rapidly.
Recipes
During discussions with German media, Tavares explained that turning to low-cost regions demonstrated Stellantis’ capacity to adapt, much like in China. He described a dual strategy: selling Leapmotor vehicles alongside Stellantis brands in Europe, which provides a substantial cost advantage, and offering Citroën-badged models such as an ë-C3 assembled in Slovakia for under 20,000 euros. In his view, this repositions Stellantis from merely reacting to the Chinese push to actively benefiting from it. He stressed that the company has not fallen into enemy hands and that Stellantis remains on the winning side of China’s opening in Europe.
In Tavares’ assessment, politicians are creating significant hurdles for their own businesses by pitting industries against Asian rivals. His broader aim is to improve the balance, arguing for a vehicle fleet composed of affordable, practical cars for the middle class. He highlighted mild-hybrid electric vehicles (MHEV) as a leading example, noting that they emit less than 100 grams of CO2 per kilometer and can be priced under 20,000 euros. He pointed to the renewed Peugeot 200 pre-series shown by the Faro de Vigo division of the Prensa Ibérica Group as a sign of ongoing progress, with future integration planned for K9 vans.
Looking ahead, he suggested that higher quotas for electric cars could be established as part of a dual focus that would support the broader transformation without risking the social fabric of the industry. The overarching message is clear: Europe must balance ambition with practical costs, enabling a smoother transition to a cleaner, more competitive automotive landscape.