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UPDATE 1-BMW looking at venture with China's Great Wall, may build factory -source

-source@

* Great Wall HK shares surge as much as 19 pct

* Firms looking at possible plant in Changshu -source

* Foreign carmakers rushing to invest in electric vehicles (Recasts and updates share price)

SHANGHAI/BEIJING, Oct 11 (Reuters) - German luxury automaker BMW is looking at forming a venture with Great Wall Motor, a source familiar with the matter said - plans which sent the Chinese automaker's shares surging by nearly a fifth on Wednesday.

The automakers are looking at the possibility of opening an assembly plant in the eastern Chinese city of Changshu, a BMW executive said but declined to say what sort of vehicles were under consideration.

"I don't know how far along we have gone nailing this deal," or whether the two companies have official central government approval for the JV or not, said the executive, who was not authorized to speak on the matter and declined to be identified.

Foreign automakers have announced a raft of electric vehicle investments in China, which wants electric and hybrid cars to make up at least a fifth of the country's auto sales by 2025 and plans to loosen joint venture regulations.

Tesla, Ford Motor Co, Daimler AG, and General Motors are among firms that have already announced plans for making electric vehicles in China.

A BMW spokesman in China did not provide an immediate comment when contacted by Reuters on Wednesday. A Great Wall official declined to comment.

Great Wall's Hong Kong-listed shares soared as much as 19.2 percent to their highest level in over two years, before paring some of the gains to be up 14 percent in afternoon trade. Its Shanghai-listed shares were suspended from trading, pending an announcement.

The BMW and Great Wall plans were first reported by Shanghai-based www.iautodaily.com.

BMW already has one joint venture in China with local carmaker Brilliance China Automotive Holdings.

(Reporting by Adam Jourdan in SHANGHAI and Norihiko Shirouzu in BEIJING; Editing by Edwina Gibbs)