Leapmotor

Two hundred furious car owners staged a protest against Leapmotor (零跑汽车) on the same day the company launched its second product. The first car had been a catastrophe — a two-door electric coupe riddled with brake failures and screen blackouts, recalled at the rate of one in every thirteen delivered. What happened next turned China’s most embarrassing EV startup into its fastest-growing one.

The camera company’s wager

Every major Chinese EV company — NIO, Xpeng, Li Auto — was founded by internet entrepreneurs who understood software, branding, and capital markets. Leapmotor was founded by an engineer who had spent two decades building surveillance cameras. That distinction would have been merely biographical had it not produced a fundamentally different kind of automotive company: one that manufactures 65% of its core components in-house, designs its own AI chips, and builds electric drives, battery packs, and cockpit systems from scratch. The vertical integration rate is the highest among Chinese EV startups, trailing only BYD. Seventeen component factories across Zhejiang province feed two vehicle assembly plants in Jinhua with a combined capacity exceeding 480,000 units per year — a manufacturing footprint that most EV startups outsource entirely.

The competitive implications are measurable. Where NIO and Xpeng outsource drivetrain and electronics to tier-one suppliers, Leapmotor controls the cost stack from silicon to seat frame. The result is a company that can offer LiDAR, 800-volt fast charging, and augmented-reality head-up displays at price points that competitors with conventional supply chains cannot match. “Reducing supplier profits to compress costs — that’s not innovation,” Zhu Jiangming (朱江明) told Forbes China. “We must rely on R&D to create cost space.” The phrase he uses for the resulting philosophy — “luxury equality” (豪华平权) — sounds like marketing. The gross margin trajectory from -95.7% in 2019 to 14.9% in early 2025 suggests it is engineering.

Christmas Eve in Hangzhou

The story begins not in an automotive factory but in a dispatch communications workshop. In 1993, Zhu Jiangming and co-founder Fu Liquan (傅利泉) pooled RMB 5,000 and started wiring communication boxes in Hangzhou (杭州). The company they built — Dahua Technology (大华技术) — grew into the world’s second-largest video surveillance manufacturer, with revenues exceeding RMB 30 billion and technology deployed in 180 countries. Dahua’s engineering culture was defined by vertical integration: the company designed its own chips, wrote its own firmware, and manufactured its own hardware. That culture would transfer wholesale.

On Christmas Eve 2015, Leapmotor Technology Co. Ltd. was incorporated with an unusual shareholder structure: Dahua holding 33%, Fu Liquan 32%, and Zhu Jiangming 20%. The founder later admitted that he had no idea automakers needed government manufacturing licenses to build factories. He estimated the total cost at “a few billion yuan” — the actual figure, he would discover, was closer to twenty billion. That naivety, paradoxically, permitted the company to attempt something no camera engineer had any business attempting. At CES Asia in 2018, Leapmotor unveiled the Lingxin 01 — co-developed with Dahua — China’s first domestically produced automotive AI chip. The announcement signaled that this would not be a company that bought intelligence from suppliers. It would build the silicon itself. The ambition was genuine. But ambition without automotive experience produces a specific kind of failure, and that failure was imminent.

The coupe that nearly killed the company

The S01, Leapmotor’s debut vehicle, embodied every mistake a technology company can make when entering automotive. It was a two-door electric coupe launched into an SUV-dominated market. It targeted premium buyers despite coming from a brand with zero automotive credibility. And it was manufactured by a contract partner, Changjiang Automobile, which would itself enter bankruptcy — threatening Leapmotor’s ability to produce any cars at all.

The sales numbers told the story with brutal clarity: approximately 1,000 units sold in 2019 against a target of 10,000. Within months, owners reported brake failures, power system faults, screen blackouts, steering lockups, and battery overheating. More than 200 owners organized a collective protest. The government mandated a recall of 150 units — one in every thirteen vehicles that had been delivered. Gross margins hit -95.7%. Monthly sales stalled in double and low triple digits. Cumulative losses across three years exceeded RMB 4.8 billion. Company executives discussed abandoning the automotive venture entirely.

The capital markets were equally brutal. Throughout 2020, Zhu Jiangming met eighty-nine batches of investors. Not one committed funding. The man who had co-built an RMB 85 billion surveillance company could not convince a single venture capitalist that his car company deserved to survive. The company that had produced China’s first domestically designed automotive AI chip two years earlier could not raise a single yuan. Zhu pledged his personal fortune to cover three years of employee salaries. The total personal investment would reach approximately RMB 2 billion — “some voluntarily, some involuntarily,” he later reflected, “because nobody else would invest.”

The pivot came at Qiandao Lake. In a closed-door strategy retreat, Leapmotor’s leadership team confronted what the market was telling them and made three decisions that would redefine the company: abandon the premium segment, pivot to mass-market affordability, and add extended-range powertrains alongside pure electric. The company also hired auto industry veteran Wu Baojun as president to lead fundraising and solve the production qualification crisis, then acquired Fujian New Forta Automobile in December 2020 to obtain an independent manufacturing license — ending the dependence on contract partners that had contributed to the S01’s quality failures. The S01 thesis — that a surveillance engineer could build a premium sports car — was dead. What replaced it was the thesis that a surveillance engineer could build something far harder: a cheap, smart, practical car that worked.

The ten-thousand-unit answer

The T03 budget city car launched in May 2020 at RMB 69,800. It sold 10,300 units in its first six months — more than the S01 had sold across its entire production life. A single product decision, executed under existential duress, reversed the company’s trajectory. The T03 was not sophisticated. It was not aspirational. It was a small, affordable electric vehicle with a quality level that met expectations rather than betraying them. For a company that had nearly ceased to exist, it was enough.

The capital markets noticed. In January 2021, Leapmotor raised RMB 4.3 billion in a Series B round that was oversubscribed thirteen times. The same investors who had declined funding twelve months earlier were now competing to participate. The IPO followed in September 2022 on the Hong Kong Stock Exchange, raising HK$6 billion — though the stock immediately fell 33.5% on its first day of trading, a reminder that market confidence remained fragile.

The structural breakthrough arrived in October 2023 when Stellantis — parent company of Peugeot, Citroën, Fiat, and Jeep — invested €1.5 billion for a 20% strategic stake and co-founded Leapmotor International, a 51/49 joint venture headquartered in Amsterdam. The deal gave Leapmotor distribution access to more than 130 markets without the decade-long process of building a global sales network from scratch. It also represented something increasingly rare in the automotive industry: a major Western automaker conceding that a Chinese startup’s engineering was superior to its own internal EV capabilities. The power dynamic between East and West had inverted — the technology supplier was from Hangzhou, not Stuttgart or Detroit.

European sales launched in September 2024 across thirteen countries, with the T03 priced at €18,900 and the C10 SUV at €36,400 — through co-located Stellantis dealer networks at Peugeot, Citroen, and Opel locations. By late 2025, more than 650 European retail outlets carried Leapmotor vehicles, with Germany, France, and Spain emerging as the leading markets. Assembly began at Stellantis’ Tychy plant in Poland before shifting to the Figueruelas plant near Zaragoza, Spain, where B10 compact SUV production targets August 2026 at an initial capacity of 40,000 units annually. Total international sales reached approximately 60,000 units in 2025 across thirty-five countries, with a target of 500,000 annual international deliveries by 2030. The company that could not sell 1,000 coupes in China was now manufacturing cars in Europe.

From one thousand to one million

The C16 six-seat SUV, launched in 2024, distilled Leapmotor’s competitive thesis into a single product. Priced at roughly half the cost of a comparable Li Auto L7 or L8, it offered matching features — LiDAR, 800-volt architecture, intelligent cockpit — at a price point that Li Auto’s supply chain economics could not reach. The C16 held the number-one position in its segment for eight consecutive weeks. Leapmotor’s cost-engineering advantage was producing category leaders, not just competitive entries.

Q4 2024 delivered Leapmotor’s first quarterly profit: RMB 80.9 million, arriving one year ahead of internal projections. Gross margins reached 13.3% — a swing of more than 109 percentage points from the -95.7% recorded in 2019. Full-year revenue hit RMB 32.16 billion, a 92% increase over the prior year. H1 2025 accelerated further to RMB 24.25 billion, up 174% year-over-year. The company that had lost money on every vehicle it built was now financially self-sustaining, with RMB 25.7 billion in cash reserves and a market capitalization of approximately $8.2 billion on the Hong Kong Stock Exchange.

The volume trajectory confirmed the transformation’s scale. Annual deliveries reached 596,555 vehicles in 2025, more than doubling year-over-year and surpassing Li Auto and Xpeng to make Leapmotor China’s highest-volume NEV startup. The company now delivers more than 1,600 vehicles per day through a domestic network of 806 stores and 461 service outlets spanning 286 cities. Approximately 80% of its 21,656 employees work in research and development — a ratio that reflects the surveillance-industry conviction that engineering depth, not marketing spend, creates durable competitive advantage. On September 25, 2025 — a decade after founding — the one-millionth vehicle rolled off the Jinhua production line. The distance between that milestone and the S01’s lifetime total of roughly 1,000 units is the distance between a failed experiment and a serious industrial enterprise.

In December 2025, FAW Group — China’s largest state-owned automaker — invested RMB 3.74 billion for a 5% stake, validating Leapmotor’s emerging “Vehicle + Tier 0.5” model: licensing its self-developed EV platforms to established manufacturers. The product line now spans five segments from the A-segment T03 city car to the D-segment flagship SUV, with dual powertrain options across most models. The company that could not raise money from eighty-nine batches of investors now attracts capital from both Europe’s fourth-largest automaker and China’s most powerful state automotive group. Whether Leapmotor’s surveillance-industry DNA can sustain this trajectory as the company targets one million annual sales by 2026 is the question that will define its second decade. The first decade’s answer — from 1,000 rejected coupes to 600,000 delivered vehicles, from -95.7% gross margins to profitability, from eighty-nine investor rejections to a Stellantis partnership — suggests the camera engineer’s wager has paid off.

Last updated: March 15, 2026