28 Mar 2024
Thursday 9 March 2017 - 12:24
Story Code : 254152

Why Irans auto ambitions will benefit economy, not consumers

Al Monitor| Alireza Ramezani: In February,Iran hosted an international auto show for the first time in 11 years. Some two dozen European, Asian and Iranian brands, including Irans longtime French partners Renault and Peugeot, took part in the Feb. 14-18 event. Many experts saw the exhibition, which was organized by Iranian and Chinese companies, as an invitation to both global carmakers looking for new markets and Iranian consumers looking for new global brands.


The Tehran Auto Show took placeimmediately after a two-day automotive conference at Tehrans Milad Tower, where 400 global manufacturers of cars and car partsgathered to discuss new ways of cooperation. Iranian companies and foreign firms made at least six agreements on the sidelines of the conference,AftabNews reported.

Tehran Auto Show participants includedBMW, Scania, KIA, Hyundai, Brillianceand even a Russian brand UAZ. The latterdisplayed three models of vehicles andhad obviously redesigned its vehicles for Iranian roads and weather conditions. This is the first time in more than a decade,after the RussianGAZelle van, that Russian vehicles are entering the Iranian market.

Saeid Zarepour, CEO of Tavan Khodro Group, which has entered into a joint venture with UAZ, expressed confidence that the UAZ models will find their place among Iranian consumers when the vehiclesarrive in the country in April. He told Al-Monitor that Iranian firms supply 40% of the parts used in the vehicles. He said that providing extensive after-sales servicewill be a priority for the Russian brand, which he believes is a staunch competitor to Chinese carmakers.

London Taxi,the producer of the most expensive professional taxi cabs in the world,also participated in the Tehran Auto Show,as its managers seeka way into the booming Iranian market. The British company partnered with Chinese Brilliance, which is already registered in the northwestern Aras Free Trade Zone. Alex Luo, a manager at London Taxi, told Al-Monitor that the company isnegotiating with Iranian officials to enter mainland Iran. He hopesthe black cabs willbe welcomed in well-off areas in majorIranian cities.

Many other brands are preparing to grab a share of Irans 80-million-strong consumer market. However, the government is enforcing the condition that no intermediary company can be involved in joint ventures and that the manufacturer must prioritize providing proper after-sales service.

 

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