Smartphone giant Samsung, in a move to diversify as the global smartphone market weakens, is believed to be in talks to take a stake in Chinese electric-car maker BYD.

According to the Korea Economic Daily, the deal is valued at CNY3 billion ($450 million), giving Samsung a 4 per cent stake. But BYD has denied that report, Engadget said.

The world’s largest smartphone maker said the two firms will discuss possible partnerships in “various businesses” and will likely supply BYD with everything from chips to batteries as well as integrate its smartphones into the cars, Venture Beat reported. But in the longer term, the partnership could extend into other areas. BYD also is a supplier of batteries for electric vehicles.

Many analysts reckon the smartphone market has peaked. Last month IDC revised downward its forecast for smartphone market growth this year, “on the basis of the continued slowdown in mature markets and China”. The research firm said that the market will grow by 3.1 per cent to 1.48 billion shipments, a reduction of 2.6 points on its last forecast. That marks a significant slowdown from 10.5 per cent growth in 2015 and 27.8 per cent in 2014.

Samsung isn’t the first smartphone maker to branch out from the manufacture of smartphones into the car market. Apple is reported to be looking at ways of making a self-driving electric car. Chinese smartphone maker LeEco is partnering with luxury carmaker Aston Martin to develop a range of next-gen connected electric vehicles, including a production version of Aston Martin’s RapidE concept car. Chinese search giant Baidu is also said to be developing self-driving cars with BMW.

After a weak 2015, Samsung has rebounded this year on the back of buoyant sales of its flagship Galaxy S7 smartphones. The vendor earlier this month confirmed reports it is set to post strong numbers for Q2. It expects an operating profit of KRW8.1 trillion ($7 billion) on revenue of KRW50 trillion. These figures are up year-on-year by 17.4 per cent and 3.1 per cent respectively, and means the company is on track for its most profitable quarter in two years.