Xiaomi joins the ranks of Chinese tech giants to work on EVs

After weeks of rumors, Xiaomi officially confirmed that it is making a foray into the electric vehicle space. The Chinese smartphone and IoT giant will set up a wholly-owned subsidiary to operate a smart EV business, the company said in a filing on Tuesday.

Xiaomi will inject an initial 10 billion yuan ($1.52 billion) into the venture with the total investment amount to reach $10 billion over the next ten years. Xiaomi founder and CEO Lei Jun will serve as the CEO of the new EV venture.

It's unclear from the filing whether Xiaomi will sell cars under its own household brand and contract manufacturers to take care of production, as it has done for most of its hardware devices. The company has long billed itself as an internet firm" with a light-asset business model. The goal is to generate a chunk of its profits by selling services powering a myriad of price-friendly hardware products it sells.

A representative from Xiaomi said the company has no further detail to share beyond the filing.

Xiaomi is the latest Chinese tech company to enter the red-hot EV industry. Chinese search engine giant Baidu recently announced it would be making EVs with the help of automaker Geely.

More to come...