Samsung expanding into smart car market

Samsung Electronics was up on Thursday, after the Korean technology giant revealed plans to expand into the self-driving car industry.

But rather than develop the vehicles itself, Samsung said it would develop vehicle components for the car manufacturers.

A new team is planned to "focus on building its competencies in infotainment and autonomous driving vehicles", the South Korean firm says in its annual business reorganisation plan.

The unit is to be headed by Samsung executive vice president Park Jong-Hwan. Park once supervised the production of motors and compressors for Samsung's home appliance arm.

Samsung's new car parts team would be complemented through close partnerships with sister firms Samsung SDI - a batter maker - and software services provider Samsung SDS.

Samsung Electionics - South Korea's most valuable firm - closed 2% higher on the news. Samsung Electro-Mechanics, a camera and component producer, closed up 4%, and Samsung SDI was up 0.8%.

The conglomerate's domestic arch-rival LG was down 6.2% as investors feared a more competitive market would hurt the firm, which began manufacturing smart car components in 2013.

Samsung's expansion into smart vehicles means it joins not just LG, but technology giants such as Apple, Google and Panasonic in developing the next generation of personal transport.

Google's self-driving cars have received much press in recent years, with Apple's purported plans for an electric self-driving car much more secretive.

Samsung's plan to provide components, rather than develop the cars itself, could see it mirror its success in the semiconductor business. Samsung's chips are so ubiquitous they are a key part of Apple's iPhone range, despite the two companies being smartphone nemeses.