Mitsubishi Motors Corp. and Nissan Motor Co. are negotiating a possible integration of their minivehicle businesses under a joint venture to be set up next spring, industry sources said Thursday.

MMC, reeling from a string of scandals involving vehicle defect coverups, might sell its minicar plant in Kurashiki, Okayama Prefecture, to the planned joint venture, to be be tentatively named Nissan Mitsubishi Minicar, the sources said.

The joint venture is expected to be 51 percent owned by Nissan and the remainder by Mitsubishi, although Nissan could effectively take control of the unit in the future, they said.

A deal with Nissan would allow MMC, which is reviewing a reconstruction plan it drew up in May, to use proceeds from the sale to reduce its debts, they said.

With the envisioned minivehicle spinoff, MMC would specialize mainly in sport utility vehicles, according to the sources.

The minivehicle business is currently the core of MMC’s domestic sales. Of its total sales of some 358,000 vehicles in Japan in fiscal 2003, about 230,000 were minivehicles.

For Nissan, the planned alliance is viewed as a means of realizing its target of increasing global sales by 1 million vehicles from the fiscal 2001 level, they said.

MMC’s sales have plummeted since the coverup scandals, some related to fatal accidents, came to light.

In September, the company’s domestic sales plunged 58.6 percent from a year before to 5,382 vehicles, down for the 10th consecutive month.

Since DaimlerChrysler AG stopped providing it with financial assistance in April, the automaker has been trying to reconstruct its business with financial aid from Mitsubishi group firms and other companies, including corporate revival fund Phoenix Capital Co.

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