Iran's Automotive and Automotive Parts Industry - January 2017
Jan 15, 2017
Executive Summary
The present report, has been prepared with the aim of providing the readers with an overview of Iran’s automotive industry. It also examines car production, exports, and imports as it identifies the industry’s key players. This report analyzes what has been envisioned in the country’s Sixth Development Plan to expand the automotive industry, the approach the industry adopted in the wake of the Joint Comprehensive Plan of Action [the 2015 nuclear deal Iran struck with P5+1], and gaps between realities on the ground and the objectives laid out in the Sixth Development Plan.
Although the title of every chapter can be examined in detail, the present report is designed to put together a collection of information for readers who don’t have much time to search the news websites or analyze what is going on. In this report which builds on reports released by official sources of the country, efforts have been made to avoid speculation. Our analyses have been provided by automotive experts with firsthand knowledge of the automotive industry problems and challenges. The readers can make their own interpretations based on the data provided.
This report also takes a look at the approach of global automotive manufacturers to the Iranian market, their future plans for the Iranian market and their cooperation with Iranian automobile manufacturers. What is important here is to keep the report and its analyses short to make it possible for the readers to get more information and analytical insight in a shorter period of time.
Table of Contents
1 Notes 4
2 Executive Summary 5
3 Introduction 5
4 Background of Automotive Manufacturing in Iran 6
4.1 Automotive Manufacturers 8
4.1.1 Iran Khodro Industrial Group 8
4.1.2 SAIPA Group 8
4.1.3 Pars Khodro 9
4.1.4 Bahman Group 9
4.1.5 Morattab Khodro 10
4.1.6 Kerman Motor Company 11
4.1.7 Khavar Industrial Group 11
4.1.8 Iran Kaveh or SAIPA Diesel Company 12
4.1.9 Shahab Khodro 12
5 Position of Automotive Industry in Iran 12
6 Sixth Development Plan and Auto Industry 13
7 Automotive Industry Prospects in 2025 Outlook Plan 14
8 Investment in Automotive Industry 18
8.1 Internationalization of Automotive Industry 19
8.2 Uncertainty Surrounding the Presence of Foreign Investors in the Automotive Industry 20
8.3 Ambiguity Surrounding Implementation of Deals 21
8.4 Expected Effect of Guidelines on Foreign Deals 22
9 Automotive Production in Iran 22
10 Market Share 26
10.1 Chinese Production in Iran Market 30
11 Automotive Industry Quality 31
11.1 Quality of Passenger Cars 31
11.2 Quality of Pickup Trucks 32
11.3 Quality of Aftersales Services 33
11.4 Aftersales Services Challenges 34
12 Automotive Imports and Exports 35
12.1 Imports of Foreign Brands in Iran in the First Six Months of 1395 (March 2016 – August 2016) 37
13 Challenges Facing Auto Manufacturing in Iran 39
13.1 Challenges Stemming from State Management 39
13.2 Macro-economic and Political Challenges 41
13.3 Structural challenges 42
14 Post-JCPOA Joint Ventures 43
14.1 Renault – IDRO 43
14.2 PSA Group – Iran Khodro 43
14.3 Citroen – SAIPA 44
14.4 Volkswagen – Mammut Group 44
14.5 Mercedes Benz – Iran Khodro 45
15 Iranian Car Importers 45
16 Automotive Parts Industry 50
16.1 Iran’s Auto Parts Manufacturing Industry in Post-JCPOA Era 51
16.1.1 €80 Million Deal with France’s Faurecia 51
16.1.2 Two Deals Inked on the Sidelines of 3rd IAIIC 52
16.1.3 Cooperation between Iranian Auto Parts Manufacturers, France’s Renault 52
16.2 Path to Development of Iran’s Auto Parts Industry 53
16.3 Recession (2007-2015) in Iran’s Auto Parts Industry 53
16.3.1 100 Auto Parts Manufacturing Units Close Down 54
16.3.2 Employment Wakeup Call among Auto Parts Manufacturers 54
16.4 A Look at Geographical Distribution of Auto Parts Manufacturing Industry 55
16.5 Iran’s Top Auto Parts Manufacturers and Suppliers 56
16.6 Auto Parts Market 64
16.7 Imports and Exports of Auto Parts 65
16.8 Automotive Parts Trends and Developments 68
17 SWOT Analysis of Iranian Economy Based on Economic Developments of Past Year 69
18 References 72