China's Xiaomi to make Electric Vehicles: sources

Another tech firm has joined the race to make electric vehicles.

This time it's Chinese smartphone maker Xiaomi.

Sources told Reuters that Xiaomi plans to make the cars using Great Wall's factory in China.

Great Wall is also said to be providing engineering consultancy to speed up the project, with Xiaomi aiming to launch its first EV by 2023.

News of the potential tie-up sent shares in both companies up as much as 9% and 15% respectively.

Xiaomi has been looking to diversify its revenue streams from the smartphone business.

It accounts for the bulk of its income but carries razor-thin profit margins.

The company has also been hampered by the global chip shortage.

Xiaomi joins a number of tech companies trying to leap into the car industry.

Both Huawei and Apple are reported to be planning electric vehicles, with Apple potentially launching its offering as soon as 2024.