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Xiaomi Corp's stock price rose over 9 percent in the afternoon Friday trade after it was reported to have plans to manufacture electric vehicles (EVs) using Great Wall Motor Co Ltd’s factory.
Meanwhile, Great Wall’s Hong Kong stock soared over 15 percent, and its Shanghai shares gained by their maximum 10 percent daily limit.
The Chinese smartphone manufacturer is targetting the mass market with its EV offerings, in line with the broader positioning of its electronics products.
Great Wall China’s biggest pickup truck maker, will provide engineering consultancy to speed up the project, its first time to offer manufacturing services to other companies.
The companies plan to announce the partnership as soon as early next week.
Xiaomi is seeking to diversify its revenue sources from the smartphone business, which accounts for the bulk of its income but carries razor-thin profit margins.
In reporting quarterly revenue below market estimates, it flagged rising costs from a global chip shortage.
Xiaomi plans to launch its first EV around 2023.
