Nissan Motor Co. Ltd. has begun a new business relationship with Samsung Heavy Industries Co. Ltd. of South Korea in which the Japanese automaker will provide technical assistance on a licensing basis.
The agreement is in line with a South Korean government proposal to introduce industrial technology into the Korean market from Japan, and follows other technical links between Mitsubishi Motors and Hyundai, and Mazda and Kia.According to the agreement, Nissan will develop a car for Samsung and will provide technical information for a car manufacturing plant that is planned for the Pusan area on the country's west coast.
Nissan, Japan's No. 2 car company, will also furnish support in the area of parts manufacturing and sales.
Samsung, a large conglomerate, hopes to begin passenger car production by the middle of 1997 but is meeting opposition from the country's three main carmakers - Hyundai, Kia and Daewoo.
All are worried about excessive competition and a glut in the domestic market, and want to delay the approval of Samsung's application for the production of passenger cars, which will soon be filed.
Analysts said Nissan may be interested in the growth potential of the Korean market, although car exports from Japan are now effectively prohibited because of huge tariffs which make it uneconomical.
South Korean vehicle sales have increased more than 20 percent annually since 1987, and are expected to enjoy double-digit growth for the forseeable future.
Analysts say there may also be more immediate benefits for Nissan, a company that has suffered severely from the prolonged Japanese recession.
A Nissan official said the agreement marked the time for Nissan to establish a relationship with a Korean company.