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Nissan Motor Co. President Yoshikazu Hanawa on Friday denied his company has negotiated with DaimlerChrysler AG over a capital-tieup alliance, but added that “generally speaking,” the firm will welcome talks for a global alliance with other major automakers to survive the 21st century.

“I haven’t spoken a word about capital tieup (with DaimlerChrysler),” Hanawa told a news conference in Tokyo. “I was surprised to hear the report” he said referring to German news magazine Der Spiegel, which claimed Daimler sounded out a possible equity partnership with Nissan.

The nation’s second-largest automaker announced the same day that it intends to slash domestic production capacity by 300,000 units to 1.7 million by 2003 to stem the tide of red ink flowing from its ailing operations.

The plan may go as far as factory shutdowns and will include an over 66% reduction in the number of its welding lines.

Noting that global competition in the auto industry will further intensify, Hanawa predicted that such a trend will accelerate the formation of an alliance by major auto makers. “We’re positively thinking about such moves,” Hanawa said. However, specific projects should come before negotiations on capital tieups, he said.

DaimlerChrysler has been negotiating with Nissan Motor’s truck and bus-making subsidiary, Nissan Diesel Motor Co., for a possible partnership and acquisition of a capital stake in Nissan Diesel.

Der Spiegel reported that Eckhard Cordes, the German-U.S. firm’s executive in charge of management strategy, visited Japan last week and sounded out a possible equity partnership with Nissan Motor.

Nissan’s sales projection for 1999 is its lowest since 1970, according to a Nissan spokesman.

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