Automotive group Stellantis announced on Wednesday it had signed a memorandum to establish a joint venture with China's Dongfeng to share manufacturing, sales, and engineering operations in Europe.
The deal to bolster sales as the European Union pushes carmakers to produce more clean-energy vehicles will see Dongfeng's Voyah EVs built at Stellantis's plant in Rennes, western France, for the European market, the companies said in a statement.
By building locally, Dongfeng can avoid hefty EU tariffs on Chinese EV imports imposed as a way to protect domestic automakers.
It is the latest move by Stellantis chief Antonio Filosa to revive sales and profits at the world's fourth-largest automaker, in particular in Europe, where the shift away from combustion engines has sputtered.
The company announced earlier this month a deal with Dongfeng to build Jeep and Peugeot models for the Chinese market, and increase cooperation on technology research and development.
