Google has strained relations with the Chinese government, who blocked access to its search engine there in 2010. There’s no doubt that the US company is missing out on a lot of money due to the restrictions on its services in the market — which extends to things like YouTube and the Google Play Store — given that it’s estimated to be home to more than a billion smartphone users. However, a recent report from The Information suggests it’s taking significant steps to gain a foothold there.

Google is reportedly building a new hardware team in Shanghai with a focus on smartphones and the Google Home. Google is said to have increased the number of engineers in its Shanghai team from 20 a year ago to 150 currently, with most of the recent hires being former Apple and Amazon employees with “experience in hardware and supply chain management.”

The Information says that Google isn’t interested in selling hardware in China for the moment, but suggests that it may try to leverage the low-cost manufacturing companies in the region for future products. With a view to this, Google is already reported to have “struck some deals” with local brands.

The Shanghai team is also said to be working on wearables, VR headsets and Pixelbooks — essentially, the same hardware ventures as Google is currently pursuing in the West.

If it’s true that Google doesn’t want to sell hardware in China right now, but that it is assembling what appears to be a team of hardware experts there, it’s possible that Google simply wants to make a bigger push towards better, less costly devices for a global release.

Google could potentially tap the services of local manufacturers to buy components for a fraction of what it has been paying (Google has relied on competing companies like HTC, LG and Huawei for manufacturing in the past, and US businesses like Marvell), while getting help from the Apple, Amazon (and potentially HTC) veterans for the actual product design.

The Information also indicates that Google has hired some former Jide Technology employees — the company behind Remix OS and other Android-based computers — for the Shanghai team; whatever Google is planning, it looks like it’s going to be in strong position to create some outstanding hardware products in the future.

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