Leapmotor readies more value models as it clears profitability hurdle

Two recent facts revealed about Stellantis-backed Chinese electric car maker Leapmotor shouldn’t both be true at the same time but somehow are. The first is that the company’s T03 electric runabout is now the UK’s cheapest car – £14,495 after a recent £1500 discount applied by Leapmotor to mimic the government grant. The second is that Leapmotor posted its first-ever half-year net profit, elevating it into the very exclusive club of Chinese electric-focused start-ups to have turned margin positive. The only other member is Li Auto, a premium maker of mainly large range-extender SUVs. Any company that can profitably sell cheap electric cars clearly points to the future of the automotive industry, so what’s Leapmotor’s secret? Leapmotor has so far been one of the quieter Chinese car makers in terms of UK sales, with 790 registrations so far this year to the end of July. That number has been eclipsed by the likes of BYD, MG and Chery’s Omoda/Jaecoo brands, but then Leapmotor deliveries only began in April. Along with the budget T03, the only other model it sells is the C10 mid-size electric SUV, which now has its own thread on motoring forum PistonHeads after interest was sparked by a generous private lease from as little as £161 a month (which has since ended; now it's £319 a month with £319 down). More models are coming. The B10 compact electric SUV is poised to go on sale soon and Leapmotor chief financial officer Li Tengfei announced that the company will reveal its new B05 compact electric hatchback – a rival to the MG 4 and Volkswagen ID 3 – at the Munich motor show in September. Along with the compact hatchback, the first of two small cars on a new ‘A-series’ platform are due next year. While most global car makers fear the rise of low-cost electrified cars out of China, Stellantis is cheering the growth of this particular competitor. Leapmotor’s non-Chinese sales are handled by Leapmotor International, a joint venture 51% owned by Stellantis since 2023 following a deal in which the company also bought a 20% stake in Leapmotor for €1.5 billion. “Leapmotor’s financial performance looks better than most Chinese NEV peers’,” Patrick Hummel, autos analyst at the bank UBS, wrote in a note to investors. “Stellantis made a good choice”. Leapmotor International plans to go global, but aside from some early registrations in Latin America, the bulk of the company’s 20,370 exports in the first half went to Europe. CFO Li claimed the company booked 4000 sales in July in the region, in process claiming an impressive 1% of the fussy German car market. The company claims it now has 550 dealerships in Europe – including over 50 in the UK and a target of 70 by the end of the year. Neither Leapmotor nor Stellantis breaks out the profitability of the International arm. Li claimed the division is profitable but told investors that’s not the priority at this stage. “In the initial years, the most important job is to boost sales and enhance Leapmotor's global branding presence,” he said on the company’s first-half earnings call on 18 August. The small but historically significant net profit of 30 million RMB (£3m) in the first half of 2025 came from a combination of its Chinese operations as well as a sizeable chunk (equivalent to around £20m-£30m) of carbon credits paid by Stellantis to allow it to hit emissions targets in Europe. Subsidises from the Chinese government also helped out, Li said. Even though it was pushed over the profit line by non-traditional means, Leapmotor is doing a lot better than other start-ups like Nio, Xpeng and Zeekr, all of which are still languishing in the red. Leapmotor started later than its competition, launching its first car in 2019. In the first half of this year, however, Leapmotor sold 221,664 cars in total, up 156%, with another 50,000 added in July. This is well below China’s leader, BYD, at over two million but above Li Auto, which posted sales of 30,731 in July. Profitability is even more impressive, given the company’s average selling price reached just 106,000 RMB (£11,000) in the first half, according to calculations from global investment bank Jefferies.The low price reflects the punishing competitiveness in the Chinese market but also the company’s value proposition. Leapmotor has a wider range of models on sale in China, including the new B01 saloon version of the upcoming hatchback and a larger C-badged saloon. Leapmotor's ability to make a profit from that low base reflects the fact that is vertically integrated, with 60% of the bill of materials cost coming from parts it makes itself, according to the company. Like BYD, Leapmotor produces its own batteries, which it packages into the chassis itself. The Hangzhou-based company, born out of electronics company Dahua Technology (known best for its surveillance cameras), has channelled that know-how into creating the Leap 3.5 electronic ‘software-defined’ architecture that it ports from car to car, which, it claims, reduces the development cycle of models on the platform by 25% and the overall investment by 40%. The big question is whether Leapmotor can remain profitable after it moves some production of B-series vehicles to Europe next year (either the B10 SUV or B05 hatchback or both). The big cost saving will be on the tariffs that Leapmotor currently has to pay on European Union imports, both on EVs and its combustion-engined range-extender models. Moving away from China’s low-cost supply chain will increase bills but occupying existing Stellantis plants (reportedly in Spain) won’t cost too much, Li claimed. “Our overseas projects are mostly retrofit… on existing production lines. So the overall investment will be much smaller compared with greenfield projects,” he said. Leapmotor’s low-cost, high-tech approach encompasses semi-autonomous driving and next year it claims it will be able to compete with the best thanks to improvements in lidar sensors, high-performance computer chips from Qualcomm and an ‘end-to-end’ algorithm figuring out where to place the car. As with all Chinese companies claiming leadership in this space, it’s hard to know who is actually ahead and how much the driver really can just sit back and watch as the car takes over. This has even less relevance in the UK, where hands-free technology is tightly regulated and a new system of driver assistance is needed. As for the wider tech, one of the first customers to take delivery of the cheap-deal C10 SUVs posted on the PistonHeads forum deal thread that, after a week and 400 miles, he was "pleasantly surprised" by the experience despite the car missing out on Apple CarPlay. The fact that Leapmotor can sell electric cars of decent quality both cheaply and – now - profitably bodes well for customers, dealers and especially for Stellantis, which gets to study how it’s done and potentially borrow some of the tech for itself.

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Leapmotor readies more value models as it clears profitability hurdle

Chinese start-up proves you can sell value-led electric cars profitably

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Leapmotor readies more value models as it clears profitability hurdle

Chinese start-up proves you can sell value-led electric cars profitably

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