Xiaomi Communications Co. Ltd, a Chinese multinational electronics company is planning to build its electric vehicles (EV’s) using Wall Motors Co. Ltd.’s manufacturing facility, sources revealed. This move makes Xiaomi one of the many technology companies trying to set foot into the smart vehicle market.
The tech giant’s share price surged over 6.71% after it revealed its newest strategy. Moreover, Great Wall’s Shanghai and Hong Kong stocks also rose by 7% and 8% respectively.
Great Wall Motors will be opening up its factory to an external client for the first time. It will also provide engineering consultancy services to Xiaomi, to accelerate the progress of the project.
An official announcement of the partnership between the two companies may be made within a few days, sources cited.
The decision aims to diversify Xiaomi’s revenue streams from its established smartphone segments as the industry bears considerable low-profit margins and is now facing higher costs from a global chip shortage.
The eight-year-old company also reported quarterly revenue below market estimates. Meanwhile, Xiaomi is also focusing on manufacturing several IoT devices including air purifiers, scooters, and rice cookers.
Founder and Chief Executive Officer of Xiaomi, Lei Jun reportedly said that the firm’s experience and skill in hardware manufacturing will help speed up the production and design of its EVs.
Xiaomi has plans to launch its first EV in 2023, according to one of the sources. The tech giant’s EV will host built in-technology to connect with other devices in the vehicle environment.
Chinese search engine provider Baidu Inc. had also revealed its plans to build EVs using a manufacturing plant owned by Zhejiang Geely Holding Group – a Chinese automotive company.
Xiaomi’s rivals Apple Inc. and Huawei Technologies Co. Ltd are also working towards integrating EV’s into their product database.
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