Kumho Tires said Monday that it has established a strategic alliance with Japan’s Yokohama Rubber with aims to strengthen both companies’ research and development competitiveness and expand their global presence.

To make the deal more mutually binding, they also agreed to seek technological exchanges and mutual equity holdings, with more detailed plans expected to be released as early as next year.

The fresh agreement comes at a time when Kumho Tires and Yokohama Rubber, the world’s Nos. 12 and 8 tire makers, respectively, are seeking to elevate their presence in the global market.

Under a memorandum of understanding signed Friday, the two companies agreed to share R&D capabilities especially on next-generation products, such as high-performance racing tires and more fuel-efficient tires.

Among other things, they hope to secure economies of scale under their partnership so that they compete head-on with dominant players such as Michelin and Continental.

In September, Kumho Tires opened a new R&D center in Yongin, Gyeonggi Province. Located on a 34,873-square-meter site, the new facility is devoted to high-value-added, advanced tire products.

“The strategic alliance will pave the way for the two companies to strengthen R&D capabilities and finally elevate our global competitiveness in the world,” said Kumho Tires CEO Kim Chang-kyu.

By Lee Ji-yoon (jylee@heraldcorp.com)