8 billion yuan invested in Shenlong, the "new era of joint ventures" has arrived.
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Author | Zhou Zhiyu
Returning to the A-level auto show after three years (referring to participating in the 2026 Beijing Auto Show) has made the outside world sense a different signal from Shenlong Motors. Industry insiders speculate that this high-profile "return" of French cars must signal some big moves.
The surprise came quickly. In just half a month, on May 15, WallstreetCN learned from Shenlong Motors that, starting in 2027, Shenlong Motors will produce two Jeep new energy off-road vehicles and two Peugeot new energy models at its Wuhan factory, targeting global sales. Six parties, including Stellantis and Dongfeng Group, will inject over 8 billion RMB into Shenlong Motors.
Forty years of joint ventures in China’s auto industry, it used to be the foreign side providing technology and the Chinese side providing the market. But now, the roles are completely reversed.
In the past two years, Chinese carmakers going abroad mainly relied on independent brands venturing out on their own, which led to various problems. The Wuhan deal opens a new pathway: China's technology and manufacturing capability are being directly integrated into foreign brands’ global channels to go worldwide.
Not only Shenlong. Just a week ago, Stellantis brought Leapmotor's models into its Spanish factory for production—buying technology in China while handing manufacturing of its brand to China. The industry calls 2026 the "Year of Joint Venture Products," and the technical foundations of these new products largely come from China's supply chain. The "new era of joint ventures" has already arrived.
Foreign brands bring their brand, add Chinese technology, and go international. This was unimaginable three or four years ago. Judging by the current trends, this may only be the beginning.
Collaboration Implementation
The Shenlong transaction has been brewing for over half a year, but the real change that made it possible happened more than six months ago.
A person familiar with Shenlong Motors told WallstreetCN that, for nearly the past ten years, the core issue plaguing the company wasn't product or distribution channels, but differing objectives between the two shareholders in the Chinese market. Former Stellantis CEO Carlos Tavares put cost control above all else, cutting spending and squeezing budgets globally. Dongfeng’s priorities were different, focusing more on increasing sales volume. The priorities always conflicted, resulting in repeated tug-of-war at the execution level.
After 2017, Shenlong went downhill, with management teams changing repeatedly. Each new team came with clear revival plans and high expectations, but most failed within a year or two. When shareholders’ disagreements remain unresolved, no matter how the teams below adjust, it's difficult to break through the ceiling.
The change happened at the end of 2024. Tavares' conflict with the Stellantis board became public, and he eventually left. Dongfeng also had some personnel changes. Stellantis Group Executive Vice President Olivier Francois, who had deep roots in Wuhan and trust from both sides, acted as mediator, making shareholder communication much smoother.
In July 2025, Stellantis’ new CEO Antonio Filosa, just over a month in office, flew to Wuhan with a dozen top executives. Afterwards, the global CEOs of Peugeot and Citroën visited. In March 2026, core members of the Peugeot family and Stellantis Vice Chairman Robert Peugeot personally visited Wuhan Economic Development Zone. Before the Beijing Auto Show, Shenlong's General Manager Lü Haitao accompanied the Wuhan city government to visit Stellantis headquarters in France.
The intensive top-level visits signal: both sides have finally aligned strategically. During the Beijing Auto Show, a Shenlong insider told WallstreetCN that the new cooperation plan was already in its final stages.
Ultimately, the agreement signed on May 15 involved total investment of RMB 8 billion, with Stellantis contributing about 130 million euros, and the rest coming from Dongfeng, local government, and other parties.
The core of the agreement is four vehicles: two Peugeot new energy models based on the design language of the "Lion Sharp" and "Liuming" concept cars first revealed globally at the Beijing Auto Show three weeks ago; and two Jeep new energy off-road models. All four will be produced at the Wuhan factory, gradually coming online from 2027, and sold simultaneously in China and global markets. On the same day, both sides also signed a non-binding strategic memorandum of understanding, leaving room for future cooperation.
The division of labor is clear. Stellantis is responsible for brand definition and global sales network—Peugeot and Jeep have mature dealer systems and brand recognition in overseas markets, resources hard for Chinese car companies to build short-term. The Chinese side provides technology and manufacturing.
Shenlong Motors CEO Lü Haitao also revealed at the Beijing Auto Show that the new models will leverage China’s advantages in electrification and intelligence industry chains, optimally integrating resources from both sides.
The Peugeot booth at the Beijing Auto Show helps understand this kind of division. The shapes of "Lion Sharp" and "Liuming" are indeed stunning. Amid serious homogenization and a flood of “Range Rovers” and “Porsches,” French design aesthetics remain a rare differentiator. But the only mass-produced model on display was a facelifted Versailles C5 X—no mass-produced new energy vehicles. Going from concept to mass production requires crossing electronic architecture, intelligent driving systems, three electric solutions, and new energy production lines—capabilities held by China's supply chain.
Design uses French foundations, technology selects the best from China, brand and channels rely on Stellantis’ global network. This transaction structure has never appeared in forty years of joint ventures.
Jeep "Rebirth"
Among the collaborations, what impresses the industry most is the Jeep brand.
Jeep was China’s first joint venture brand. Beijing Jeep in 1983 pioneered the “foreign side provides technology, Chinese side provides market” joint venture model, and Cherokee off-road vehicles became a status symbol of that era.
Over the following thirty years, Santana, Fukang, and Passat followed this path. Four decades later, the same brand returns to production in China under completely opposite terms.
However, Jeep's fate has been troubled; due to changes in Jeep's shareholders, its partnership with BAIC ended in 2008. Later, in 2010, it re-joined with GAC for a joint venture, reaching an annual sales peak of 220,000 in 2017, but then declining yearly, with only 1,861 sales in the first half of 2022. Stellantis announced the end of the joint venture, and GAC Fiat Chrysler went bankrupt.
Forty years, three collaborations, two closures. The industry had essentially assumed Jeep’s manufacturing story in China had ended.
At the end of December 2025, a subtle signal emerged. Jeep’s global product manager and sales strategy manager visited Wuhan, their focus not on Shenlong’s old production lines, but Wuhan’s intelligent connected vehicle test track. People close to Dongfeng said that China’s rapid iterative technology and efficient industrialization greatly impressed Jeep’s executives.
They came to Wuhan not for French engineering, but for Chinese technology.
Five months later, Jeep signed the new deal. Compared to the era with GAC Fiat Chrysler, it’s a completely different species: last time they brought global models to China to sell to Chinese consumers and struggled; this time, two new energy off-road vehicles are aimed at the global market from inception, with the Chinese side responsible for technology and manufacturing, and Jeep responsible for brand and channels.
Market news says Filosa will announce at this month’s strategy conference that Stellantis will focus resources on Jeep, Ram, Peugeot, and Fiat—two of which are now in Wuhan.
For a company whose global market share dropped from 8.1% to 6.1% in two years, trading brand for a new product lifeline is a rational choice.
Shenlong’s calculations also add up. Chengdu factory will mass produce Yijing in July 2026, an East Wind/Huawei joint venture brand. Wuhan factory will take Peugeot and Jeep in 2027. Two factories will serve four brand systems, and 390,000 annual capacity will recover from less than 10% utilization.
Lü Haitao is well aware of Shenlong's situation; for a joint venture to return to past peak sales is unrealistic. Achieving sustainable profitability is the bottom line.
Lü Haitao stated during media interviews at the Beijing Auto Show that Shenlong Motors will not blindly pursue scale, aiming to build a sustainable, healthy, and stable joint venture with consistent profits.
Not chasing volume, just surviving first. This is the most honest statement a joint venture can make in 2026.
New Joint Venture Era
Looking beyond Shenlong Motors, one sees that “brand for technology” is not an improvisation by one company but an emerging industry trend.
A week before signing, Stellantis and Leapmotor announced expanded cooperation; Leapmotor's B10 will be produced at Stellantis' factory in Spain, and Leapmotor parts will supply the Opel brand.
The same group signed two deals in China in one week, heading in opposite directions: Leapmotor buys products and technology, Shenlong sells brand and channels. In and out, Stellantis' role in China has shifted from technology exporter to brand exporter.
Another Dongfeng-affiliated joint venture moved faster than Shenlong. Dongfeng Nissan began implementing the GLOCAL model in 2024, giving China’s team the authority to define new energy products once held by the Japanese headquarters. Dongfeng and Nissan also formed a joint import-export company with 1 billion yuan in capital. The N7 developed mainly by the Chinese team is already being exported through this channel. Nissan CEO Espinosa has repeatedly said, “China’s market today is the global market tomorrow.”
Volkswagen is on a similar path. After investing in Xpeng, the first joint project Yuzhong 08 rolled off the line in Hefei in March, with intelligent driving and basic architecture coming from Xpeng. Starting in 2026, all pure electric models VW launches in China will feature electronic architecture co-developed with Xpeng.
The paths differ, but the direction is highly consistent. Independent brands’ market share has surpassed 65%, and new energy penetration exceeds 50%. Honda has forecast its first-ever annual net loss since founding. The industry calls 2026 the "Year of Joint Venture Products," not because the foreign side has new technology, but because a batch of joint venture cars equipped with Chinese technology are being launched together.
Forty years ago, the joint venture formula was "market for technology"—the foreign side brought engines and platforms, the Chinese side provided factories and a consumer base of over a billion. Santana, Fukang, Passat—all were products of this formula. Back then, the core value of joint ventures was foreign technology.
Today this formula is being flipped. China’s capabilities built in electrification and intelligence are now being channeled out through foreign brands’ global networks. What the foreign side brings is no longer technology, but brand and channels.
Whether the "new joint venture" is sustainable remains to be seen. Shenlong's four new cars won't be produced until 2027, the 8 billion investment comes with conditions, and Stellantis itself is still restructuring globally. But after forty years of joint car manufacturing, it’s the first time the Chinese side has truly sat on the technology side.
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