At a live streamed event held on Tuesday, Xiaomi CEO Lei Jun, who will also head the smart EV unit, said the division will be the “last major entrepreneurial project” in his life.
The firm will initially invest 10 billion yuan ($1.52 billion) in the unit, with a total investment goal of $10 billion over the next ten years, it said in a filing published earlier on the Hong Kong stock exchange.
The company’s move into cars follows similar steps by other tech giants, in China and overseas. In January, Chinese search giant Baidu Inc said it would develop an EV unit via a partnership with domestic carmaker Geely Automobile Holdings Ltd.
Last month Reuters reported that Chinese smartphone giant Huawei Technologies Co Ltd was in talks with state-owned automaker Changan Automobile and others to manufacture EVs, while Apple Inc is also planning an entry into the EV market, according to reports.
Reuters reported last week that Xiaomi was in talks to partner with Chinese automaker Great Wall Motor Co for help in manufacturing EVs.
Xiaomi declined to comment on the report, while Great Wall said in an exchange filing that it had not discussed such a partnership with Xiaomi. Lei made no mention of partnerships in his public remarks.
During the press event, Xiaomi also announced the release of a self-developed computing chip. Known as the Surge C1, the chip is an image signal processor (ISP), used to enhance a phone`s ability to process high-resolution images and video.
Xiaomi said that the company took two years and spent 140 million yuan in research and development costs to develop the chip, which will be placed in the company’s newly announced Mi Mix folding phone.
The company has long been attempting to crack the semiconductor sector, though to date it has had limited success compared to rival Chinese Android maker Huawei.