Nissan Motor Co, Japan's third- biggest automaker, may find strong demand for its vehicles in South Korea should it decide to become the third Japanese automaker to sell cars in the country, analysts said.
The Nihon Keizai newspaper today reported Nissan will sell models that don't compete with those offered in the country by its affiliate Renault Samsung Motors Co next year, the report said, without saying where it obtained the information.
Toyota Motor Corp and other foreign automakers are starting to see growth in sales in a country where consumers traditionally stick to local products. Toyota's sales more than tripled last year and the share of imported cars sold in the market is forecast by an analyst to rise more than 10 times by 2005.
"The success of Toyota probably makes Nissan want to follow," said Kim Hag Ju, an auto analyst at Samsung Securities Co. in Seoul.
Tokyo-based Nissan, which is targeting sales of 3.6 million units a year by the second half of 2005 from 2.6 million in the year ended March 2002, plans to do that partly by entering new markets.
Nissan would be the third Japanese automaker after Toyota and Honda Motor Co. to start sales in South Korea. Senior Vice President Toshiyuki Shiga, in charge of general overseas, wasn't available for comment. "We have no comment," Nissan spokeswoman Keiko Hoshino said. Renault Samsung spokesman Ha Tae-eung said he hasn't heard anything about the plan.
Japanese and other foreign automakers have struggled to sell vehicles in the country, where about 1.2 million passenger cars were sold last year.
The growth in South Korean passenger car market will probably be flat this year and grow by 6.1 percent next year as the country's economy recovers, said Samsung's Kim. Imported cars account for less than 1 percent of the total market and that share may grow to as much as 10 percent in 2005, he said.
"The volume contribution for Nissan will be small in South Korea, but if it enters the market, it will probably sell luxury cars," said Noriyuki Matsushima, an analyst at Nikko Citigroup Ltd. in Tokyo.
Toyota, which became the first Japanese automaker to sell cars in South Korea in 2001, sold 3,000 units there last year, which is more than triple the 840 units it sold in 2001. Toyota only sells luxury Lexus sedans in the market, including its ES300 and LS430.
Honda said in March it plans to start selling cars such as the Accord sedan and CR-V sport-utility vehicle in the country from next year.