Carlos Ghosn has said that Nissan and its alliance partner Renault are discussing the prospect of acquiring Ssangyong in order to expand their group’s production capacity in South Korea.

”We are in discussions and we will go through an analysis,” Ghosn told the press after the company’s annual shareholders meeting in Yokohama, southwest of Tokyo.

”If the cost of this capacity is better than expanding the plant (operated by Renault subsidiary Samsung in South Korea), we are interested in making a deal around Ssangyong,” said Ghosn.

He also said that the alliance is short of capacity in Korea.

Having more capacity in South Korea would make sense because exporting those cars from Japan would make Nissan’s cars less competitive against Korean competitors due to the yen’s strength, Ghosn said.

Renault confirmed earlier this month that it has submitted a letter of interest to purchase South Korean automaker Ssangyong in tandem with partner Nissan.