In 1992, Daewoo dissolved its joint-venture with General Motors, and simultaneously a decision was made to independently develop replacements for the contemporary Daewoo Motors products, based on older General Motors models. The Lanos development programme was formally started in autumn 1993, with the goal to create a car to replace Daewoo Nexia as Daewoo's small family car.
The project began with a comparative study of competing models from 20 different manufacturers, with Toyota Tercel, Opel Astra and Volkswagen Golf identified as most competitive. Four design studios were commissioned to deliver clay models preseting their ideas for the new model's styling. Giorgetto Giugiaro's design was chosen, and Italdesign was commissioned to develop the car's final outside and interior styling. The technical side of the project was conducted simultaneously by Daewoo's development centre Korea as well as suppliers and contractors, who were involved in developing particular components. This included AC Rochester (engine componentry), Delco Chassis Division (brakes, including ABS), GM Powertrain (automatic transmission), Italdesign (body, structural analysis, electrics, prototype construction), PARS Passive Rückhaltesysteme GmbH (airbags) and Porsche (vehicle concept— research, structural analysis, suspension and brake components,and experimental production supervision).
By the end of 1995, 150 prototypes were built (providing for three body styles). The development programme involved extensive testing in a multitude of locations. Safety test included high-speed stability and durability testing in England and brake testing on the Großglockner in Austria. Low-temperature testing was conducted in Canada, Sweden (Arjeplog) and Russia (Moscow, Khabarovsk), while high-temperature tests took place in the USA (Death Valley), Oman (Nizwa), Australia (Alice Springs), Spain (Barcelona) and Italy (Nardò). The programme was completed in a remarkable time of only 30 months from the approval to the commencement of large-scale production of the Lanos sedan for the Korean market. European-market production began in 1997.).