Korea’s Samsung, better known for flat panel TVs, Galaxy smart phones and other gadgetry, wants its name removed from cars produced by Renault in Korea. “We want to take our brand ‘Samsung’ out of Renault Samsung since we don’t have anything to do with the car sales,” a Samsung executive told The Korea Herald.
Nothing doing, replied a Renault spokesman:
“Both Renault group and its Korean operation consider the relationship with Samsung successful and positive. We have no immediate plans to make any change.”
Then Samsung Motors was established in 1994 when Samsung Chairman Kun Hee Lee wanted to branch out into carmaking. Lee soon learned an expensive lesson.
When first cars rolled off the line in 1998, Korea was hit by the Asian financial crisis. Samsung Motors was put up for sale and Renault bought a 70 percent stake for $560 million in September 2000. It was decided to keep the Samsung brand, which had more standing in the Korean market than Renault. There is a license agreement that allows the carmaker to use the Samsung brand through 2020.
Renault Samsung is not doing so well. Last year, its sales dropped 9 percent. In the first quarter of this year, Renault Samsung was the worst performer among the Korean carmakers.