Xiaomi, one of the world’s largest smartphone makers, is in talks to use a Great Wall factory in China to manufacture electric cars under its brand.
Xiaomi directs its electric vehicles to the mass market, in line with the wider location of its electronic products.
Great Wall, which had not previously provided manufacturing services to other companies, is providing engineering consulting to expedite the project.
The two companies plan to announce the partnership as soon as possible next week.
This plan comes at a time when Xiaomi seeks to diversify its revenue sources outside the smart phone business, which accounts for the bulk of its income, but carries very little profit margins.
The company indicated higher costs due to the global chip shortage and reported quarterly revenues that are below market estimates.
The move also comes against a backdrop of auto makers and technology companies working closely together to develop smarter vehicles using technology, such as: smart cabins and autonomous driving.
Chinese search engine provider Baidu said in January that it plans to build electric vehicles using a car factory owned by Geely, a car manufacturer that aims to provide engineering consulting and manufacturing contracts.
Reuters also reported the auto ambitions of Apple and Huawei.
(Li Jun) Lei Jun, founder and CEO of Xiaomi, believes that the company’s experience in manufacturing devices helps accelerate the design and production of its electric vehicles.
Xiaomi wants to find a car manufacturer to provide infrastructure for the model, allowing its own advantages in mobile Internet technology.
Xiaomi’s advantages in operating systems and home furnishing provide much for such cooperation in the future.
Besides smartphones, Xiaomi manufactures dozens of internet-connected devices, including scooters, air purifiers and rice cookers.
The company plans to launch its first electric cars around 2023, and Xiaomi allows its cars to communicate with other devices in its ecosystem.
Great Wall, the largest small truck manufacturer in China, this year launched a stand-alone brand of electric and smart cars.
Great Wall is also building an electric vehicle plant in China in partnership with German BMW. It sold 1.11 million cars last year thanks to the increasing popularity of its models, and is currently building its first factory in Thailand.