Honda said on Tuesday it will start selling cars in South Korea from early next year to meet growing demand in Asia’s third largest car market, Agence France-Presse reported.

“The market has grown rapidly over the past several years, especially regarding sales of imported automobiles due to policy changes including a tariff reduction from 20% to 8% in 1995,” Honda said in a statement.

“As a result, automobile imports have nearly doubled in each of the last few years, with 2002 industry sales figures showing imported auto sales of approximately 16,000 units,” it said.

Honda Motor spokesman Masa Nagai told AFP anyone living in South Korea who wanted to buy a Honda car previously had to do so through an unofficial “grey market”.

The new sales company should be open for business in January next year with sales in the first year targeted at around 2,000 vehicles, he said.

Honda is considering establishing two dealerships in Seoul and one in Busan, added Nagai.

The Korean car market recorded sales of 1.64 million vehicles in 2002, Agence France-Presse noted.