Stellantis is in talks with Leapmotor to collaborate on producing electric vehicles at an idle factory in Canada.

Bloomberg, citing people familiar with the matter, reported that European automaker Stellantis is in talks with its Chinese partner, Zhejiang Leapmotor, to explore options for producing electric vehicles in Canada.

The people familiar with the matter said the negotiations are still in their early stages. If the two sides move forward, it would be the first major investment project by China’s auto industry in Canada since Canadian Prime Minister Carney reached an agreement in January with Chinese President Xi Jinping to lower tariffs on Chinese-made electric vehicles.

As part of the above agreement, the Carney government said it hopes to attract Chinese joint-venture investment—carried out with “reliable partners”—into Canada’s auto industry within three years.

According to reports, the Canadian discussions focus on an idle Stellantis assembly plant in Brampton, Ontario. Thousands of workers at the plant have been out of work for years. It was originally slated to produce a new Jeep sport utility vehicle (SUV). Discussions now include the possibility of producing vehicles in cooperation with China’s automaker Leapmotor.

In 2023, Stellantis acquired a 20% stake in Leapmotor. A year later, the two sides formed a joint venture, Leapmotor International, focused on global production and sales of electric vehicles.

In a statement, Canada’s Minister of Industry Melanie Joly confirmed that the government and the company are in discussions. “Any new automotive investment will prioritize Canada’s supply chain, including Canada’s workforce and parts suppliers.” The statement did not mention Leapmotor or any Chinese company.

A Stellantis spokesperson emphasized that all options regarding the Brampton plant are still under consideration and that the process is still at a very early stage.