Stellantis plans to invest more than €1 billion in France to develop new Peugeot electric and hybrid vehicles and expand production capabilities at its Mulhouse manufacturing plant.
The investment will support development of the company’s next-generation STLA One vehicle platform and production of three new Peugeot electrified models beginning in 2029.
The move forms part of Stellantis’ broader FaSTLAne 2030 strategy aimed at improving competitiveness, reducing costs, and strengthening its position against growing Chinese competition in Europe.
Key Overview
- Stellantis will invest over €1 billion in France
- Three new Peugeot electric and hybrid models will be built in Mulhouse
- Production is expected to begin in 2029
- The vehicles will use Stellantis’ new STLA One platform
- Stellantis says the platform could improve cost competitiveness by 20%
- Peugeot is one of Stellantis’ four priority global brands
- The company is restructuring European operations amid rising competition
Stellantis Expands Peugeot EV Production in France
Stellantis has announced plans to invest more than €1 billion ($1.16 billion) in France to support development of new Peugeot electric and hybrid vehicles and expand manufacturing operations at its Mulhouse plant in the Alsace region.
The automaker said the production of three Peugeot electric and hybrid models will begin in 2029 using its next-generation STLA One vehicle platform.
According to the company, the investment includes approximately €400 million for upgrades at the Mulhouse factory and a further €500 million focused on research and development activities tied to the new platform.
The announcement follows French President Emmanuel Macron’s recent confirmation that the Franco-Italian automaker planned to invest €1 billion in France as part of broader industrial and decarbonization efforts.
Stellantis said the investment aligns with objectives outlined in its recently unveiled FaSTLAne 2030 strategic plan.
STLA One Platform Central to New Strategy
The STLA One platform is expected to become a major component of Stellantis’ future global vehicle strategy.
The automaker describes the platform as a modular and scalable architecture capable of supporting multiple vehicle sizes and different powertrain technologies, including electric and hybrid systems.
According to Stellantis, the platform is designed to simplify production processes and reduce development complexity while improving overall cost competitiveness.
Chief Executive Officer Antonio Filosa said the architecture could become approximately 20% more competitive than current vehicle platforms.
“It will be the platform that will bring Stellantis to cost parity with the Chinese that build in Europe,” Filosa said during a visit to the Mulhouse facility.
The company expects the platform to support global production volumes of up to 2 million vehicles per year by 2035.
Stellantis also confirmed that the first STLA One-based vehicle will launch in Spain in 2027 with production of the next-generation Peugeot 208.
Peugeot Identified as Priority Global Brand
Within Stellantis’ broader portfolio of 14 automotive brands, Peugeot has emerged as one of four key global brands identified for future growth and profitability.
The company said Peugeot, alongside Fiat, Jeep and Ram, will receive priority focus under the FaSTLAne 2030 strategy.
Analysts say the decision reflects Peugeot’s strong market presence in Europe and its growing role within Stellantis’ electrification plans.
The new vehicles planned for Mulhouse will target Europe’s important C-segment category, which accounts for roughly 30% of European sales across the continent.
Industry experts say strengthening Peugeot’s position in the C-segment could help Stellantis defend market share against intensifying competition from both traditional automakers and newer Chinese EV manufacturers.
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Europe Remains Key Battleground
The investment also comes as Stellantis continues restructuring its European manufacturing operations amid slowing demand, excess production capacity, and growing competition from lower-cost Chinese electric vehicle makers.
The automaker is reducing its European production capacity by 20%, representing around 800,000 fewer vehicles per year.
At the same time, Stellantis is increasingly pursuing partnerships and manufacturing collaborations to improve operational efficiency and reduce costs.
The company recently expanded cooperation with Chinese partners, including Dongfeng, through agreements involving shared manufacturing, engineering, and sales operations in Europe.
Filosa said Stellantis is also working to optimize factory utilization across Europe by sharing facilities with partners and investing selectively in strategic manufacturing sites such as Mulhouse.
Analysts say European automakers are facing mounting pressure to lower EV production costs as Chinese manufacturers continue expanding aggressively into European markets with cheaper electric vehicles.
France Pushes “Made-in-Europe” Manufacturing
Stellantis also highlighted support from the French government and broader European industrial policies as factors helping drive the investment decision.
The company praised France’s commitment to supporting cleaner transportation and encouraging domestic vehicle manufacturing through “Made-in-Europe” initiatives.
Stellantis said these policies have helped create conditions conducive for investment in electric and hybrid vehicle production within Europe.
“I am very pleased to announce these investments in France for the production in Mulhouse of three 100% electric and hybrid models from the Peugeot brand,” Filosa said.
“This decision attests to the professionalism and exceptional commitment of our teams.”
European governments are increasingly pushing for local EV manufacturing expansion as concerns grow over dependence on imported Chinese electric vehicles and battery technologies.
Outlook
Stellantis’ €1 billion investment in France highlights the growing importance of electrification, manufacturing competitiveness, and industrial strategy within Europe’s automotive sector.
The company’s focus on the new STLA One platform reflects broader efforts by automakers to reduce costs and accelerate development as global EV competition intensifies.
As Peugeot prepares to launch new electric and hybrid models later this decade, Stellantis will be seeking to strengthen its position in Europe while responding to increasing pressure from Chinese manufacturers rapidly expanding across international markets.
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Sources: Yahoo Finance, MSN, RTE, Stellantis, Le Monde.fr
