Leapmotor has rounded out its powertrain line-up with the launch of the LEAP 5.0 architecture and the MM-i multi-mode hybrid drive, formally entering the PHEV (plug-in hybrid) segment on September 16, 2026. Founder Zhu Jiangming told Huxiu that the production line for the new system is already in place. There is a problem he did not dwell on: Leapmotor currently holds no licence to make or sell plug-in hybrids in China.
Under China's Auto Industry Investment Management Regulations, vehicle investment projects are split into two categories - fuel vehicles and battery-electric vehicles. Because a plug-in hybrid's engine helps drive the wheels, PHEVs count as fuel-vehicle projects; range-extenders, which are driven purely by electric motors, fall under BEV (battery-electric) projects. Leapmotor, like most Chinese EV startups, holds a "pure electric passenger vehicle (including range-extender)" manufacturing qualification, so a domestic PHEV would be legally out of bounds. A Leapmotor spokesperson confirmed exclusively to Huxiu that the MM-i system will first appear on overseas models built through the Leapmotor International joint venture - which is unaffected by the licence question - while "domestic production qualifications are being applied for."
Zhu's insistence that "plug-in hybrid technology is quite suitable for the Chinese market" therefore reads, in Huxiu's telling, as public regret. The logic becomes clearer once exports enter the picture. Chinese PHEV shipments to Europe grew 155% in 2025, against just 12% for BEVs, according to Dataforce data cited by Huxiu; by June 2026 Chinese brands held a record 34% of Europe's plug-in hybrid market. Leapmotor's own overseas deliveries reached 96,294 units in the first half of 2026, up 372.6% year on year and already more than its full-year 2025 export total.
A local shield against EU tariffs
The window is not guaranteed to stay open. The European Commission has opened an anti-subsidy investigation into Chinese plug-in hybrids and is preparing PHEV tariffs on top of existing duties on battery-electrics. PHEVs' share of Chinese auto exports to the EU has jumped from 6% in 2024 to 28% in the first seven months of 2026, Morgan Stanley research cited by Huxiu notes, so Brussels is likely to close the loophole.
Leapmotor believes it is positioned differently. Its overseas business runs through Leapmotor International with Stellantis, and it is localising production rather than shipping from China: the Zaragoza plant in Spain has been retrofitted for assembly, the Kedah plant in Malaysia is already producing the C10, and Goiania in Brazil has been selected as a South America base. Tariffs on imports cannot easily reach a carmaker building inside Europe - though the profit must be shared with the joint venture, and Leapmotor's brand awareness in Europe remains far below local names such as Opel and Peugeot.
The real bet: platform supply
Huxiu argues that the deeper motive is technology supply. Zhu cites Apple's design-and-control model and Samsung's vertical integration as templates; Leapmotor already has platform-level cooperation with FAW - a project now in mass production - and with Stellantis. Opel recently said it will develop a battery-electric C-segment SUV using Leapmotor architecture and battery technology. Battery packs, e-drives, controllers and lights can be developed, manufactured and "packaged" for partners. A Leapmotor executive described the model to Huxiu as similar to Huawei's smart-driving supply business but with a lower entry threshold, saving partners 1,000 to 2,000 yuan (about $140 to $280) per vehicle in core-component costs.
The risks are equally plain. China's PHEV market, although down 27.6% year on year, still exceeds 2 million units annually - and Leapmotor cannot sell a single car in it until a licence is granted, with no timetable for approval. Overseas, the JV structure puts the final say with Stellantis, which chose Leapmotor for cost efficiency and could turn elsewhere. And every platform sold dilutes the value of the Leapmotor badge: as Zhu's own Samsung analogy suggests, supplying the best components to others does not guarantee brand-level profit.
Huxiu estimates the MM-i program involves fixed investment of 1.2 billion to 1.6 billion yuan (about $169 million to $225 million) in R&D and production, amortised at 240 million to 320 million yuan (about $34 million to $45 million) a year over five years against a design capacity of 150,000 units. If overseas MM-i sales reach only 50,000 a year, utilisation sits at 33% and per-car amortisation of 4,800-6,400 yuan ($676-$901) would eat into vehicle margins; doubling to 100,000 units roughly halves that. Supply contracts help: a packaged LEAP-plus-MM-i system carries an estimated per-vehicle value of 18,000-26,000 yuan ($2,540-$3,660) at 12-18% gross margin, and 60,000 external orders could absorb most of the R&D amortisation - provided partners' models sell.
Whether MM-i becomes a profit source or a cost burden comes down to scale in both overseas vehicles and supplier orders at the same time. As Huxiu puts it, Leapmotor's "PHEV without a licence" is a forced detour - a high-stakes bet with a short window in which to prove it works.
