Apple has already developed software for automakers called CarPlay that let drivers use an iPhone to operate an entertainment system, and Samsung's 'entertainment systems' plans could rival this.

Meanwhile, Samsung already makes chips that can be used in self-driving vehicles and its focus in the auto area is set to expand as profits from smartphone sales sag. 

The new automotive component team will 'focus on building its competencies in infotainment and autonomous driving vehicles', the South Korean electronics giant said in its annual business reorganisation plan announced yesterday.

The Google autonomous vehicle.

The new unit will be headed by the firm's executive vice president Park Jong-Hwan who formerly supervised motor and compressor production for Samsung's home appliances.

Following on from the news, the share price of Samsung Electronics - South Korea's largest firm by value - rose by more than two per cent.

The world's most popular maker of smartphones also produces semiconductors and home appliances and has been trying to shore up ailing profits in the saturated handset market by strengthening chip production and expanding into new business areas, including healthcare.

The announcement marks the firm's first foray into the car business since 1995 when it established Samsung Motors.

The unit was sold to French carmaker Renault in 1999 as it went bankrupt in the aftermath of the 1997 Asian financial crisis.

Other global electronics firms such as LG, Apple and Panasonic are also eyeing the lucrative market for next-generation vehicles mounted with electronic sensors and displays, connected to the web.

'It appears Samsung has established a long-term plan to expand into smart car markets eyed by Google and Apple,' said Lee Ka-Keun, analyst for KB Securities.

The Internet-enabled, next-generation cars are expected to use a wide range of semiconductor components, allowing Samsung room for new growth, he added.

Another Asian company eyeing the autonomous vehicle market is Baidu.

Like Google, the company aspires to use its mapping data in autonomous vehicles.

Senior Vice President Wang Jing, told The Wall Street Journal the firm is developing self-driving vehicles that will act as public shuttle buses. 

China's state news agency, Xinhua has reported that search engine Baidu has already made a self-driving car which, in tests, hit speeds of 62 mph (100km/h).

The modified BMW 3 Series Gran Turismo was tested on expressways north of Beijing and use laser radars, sensors, and cameras alongside bespoke deep-leaning and mapping software.

While the firm has not revealed plans to bring the cars to market, the first autonomous public transport could be on the roads in just three years.

Baidu said it is in discussions with Chinese and foreign auto makers.

Future vehicles will be designed to operate on fixed routes or within specific areas, making them more suited to public transport with set routes, rather than impulsive consumer drivers.

Mr Wang added: 'We will cooperate with some governments to provide shared vehicles like a shuttle service; it could be a car or van, but for public use.

Chinese bus maker Zhengzhou Yutong Bus Co is already said to have tested a prototype self-driving bus one a 20 mile (33km) drive through central China and claims it has successfully changed lanes, passed other vehicles and responded to traffic lights.

- Daily Mail