OSAKA -- Japan's No. 1 air conditioner maker, Daikin Industries Ltd., is in final talks with Trane Co., the No. 2 U.S. air conditioner manufacturer, on a wide-ranging alliance, a Daikin official said Monday.
The alliance, which includes production and marketing, would create the world's biggest air conditioner manufacturing business, with annual sales of nearly 1 trillion yen, topping those of Carrier Corp. of the United States.
Daikin and Trane would enjoy a combined global market share of just under 20 percent.
Daikin and Trane expect to complement each other's business and slash costs to raise competitiveness because they specialize in different types of air conditioners, the official said.
The two companies expect the alliance to make them more competitive in a market facing a glut amid an inflow of low-priced products from China and South Korea.
Under the alliance, Daikin would use the U.S. company's marketing channels to sell small and midsize air conditioners in the U.S. and Latin America, while Trane aims to expand sales of large air conditioners to plants and museums, the official said.
The two companies will also consider consolidating their plants in overlapping areas, the official said.
The deal would follow one struck between Daikin and Matsushita Electric Industrial Co. in 1999, under which the two share production of air conditioners, with Daikin responsible for midsize ones and Matsushita small ones.