CHINESE EV newcomer Leapmotor has outsold Subaru and Mitsubishi in the global vehicle market for the first time in the April-June quarter as it expanded rapidly in China and Europe.

Fueled by strong demand for its affordable electric vehicles, Stellantis-backed Leapmotor surpassed established Japanese automakers just a decade after its founding.

Nikkei Asia reported that Toyota Motor retained the top spot with 2.71 million vehicles sold in the quarter, down four per cent from a year earlier, according to company disclosures and industry data compiled by Nikkei Asia.

Germany’s Volkswagen ranked second with 2.07 million units, a nine per cent decline.

The report said most leading car-makers posted weaker sales because of elevated oil prices and slowing global vehicle demand.

Leapmotor’s quarterly sales jumped 84 per cent from a year earlier to a record 240,000 vehicles. 

It beat Subaru, which sold 230,000 units, and Mitsubishi which sold 170,000, while it approached Mazda’s 300,000 sales.

Nikkei Asia said it marked the first time a Chinese startup founded after 2010 has outsold a Japanese passenger car manufacturer on a quarterly basis.

In Australia, Leapmotor recorded a modest 1022 sales year-to-date (YTD) to the end of August 2026, up 168.2 per cent on the previous corresponding period.

Subaru was down 27.5 per cent to 19,125 units sales YTD, and Mitsubishi was down 29 per cent at 30,476 sales YTD. 

Founded in 2015, Leapmotor develops key technologies in-house, including batteries, powertrain systems and driver-assistance software. It focuses on affordable EVs and plug-in hybrid vehicles.

Leapmotor’s gains come in spite of headwinds.

China scaled back tax incentives for new-energy vehicles in January. But as industry leader BYD and others struggled with weakening demand, Leapmotor won over younger consumers with economical models.

In July, monthly sales exceeded 100,000 vehicles for the first time.

Leapmotor has set a sales target of 1 million vehicles for 2026, above Subaru’s forecast of 940,000 for fiscal 2026 and Mitsubishi’s target of 857,000.

A main driver of the company’s growth is Europe, where EV adoption continues to expand. Leapmotor received investment from Stellantis, Europe’s fourth-largest car-maker by vehicle sales, and has built an overseas distribution network.

US-based mobility Information company Mobility Global said overseas markets accounted for about 20 per cent of Leapmotor’s sales in the April-June quarter, up sharply from six per cent a year earlier.

More than 80 per cent of those overseas sales came from Europe.

Nikkei Asia said that data from an Italian industry group showed that Leapmotor’s EV sales in Italy jumped 13-times year-on-year to 24,450 vehicles in the January-August period, making it Italy’s best-selling EV brand. 

It has a 27 per cent share of Italy’s EV market, far ahead of second-place Tesla at nine per cent. 

A major selling point is its lineup of low-cost models, including the T03, which sells for about 15,900 euros ($A25,700).

The company is also gaining ground in Germany and France.

Stellantis has transferred ownership of a factory in Spain to a joint venture with Leapmotor and plans to use the facility to produce Leapmotor-branded EVs. Local production could help the company further expand market share.

Japanese car-makers, meanwhile, have struggled in Europe. Nissan Motor’s sales fell 15 per cent in the April-June quarter, while Mitsubishi posted a decline of about 40 per cent.

Nikkei Asia said that as consumers increasingly switch from petrol-fuelled vehicles to EVs, encouraged by high fuel prices and government incentives, Japanese manufacturers have yet to introduce sufficiently competitive EV offerings.

In a report this month, the International Energy Agency said the rapid expansion of Chinese car-makers could have a significant impact on Japanese and European manufacturers that still rely heavily on petrol and hybrid vehicle sales.

It said that if Chinese EV startups such as Leapmotor continue to surpass Japan’s midsized car-makers in production volume, the cost-competitiveness gap in the EV market could widen even further.