Iranian taxis need to be replaced by "made in China"
Starting next August, taxis made in China will appear on the streets of Iran. According to reports, Southeast Motor will export 8000 Southeast Delica cars to Iran, all of which will be used to replace Iranian city taxis. Lingyu Zhang, chairman of Southeast Automotive, said that this is the largest batch of export orders for Southeast Motors so far, and it is also a breakthrough move to push its own brands to the international market. The Iranian side stated that in the 2008 taxi replacement plan of the Iranian government, Southeast Motors will also be its primary purchase target.
Iran's old streets and more cars
Iran is a large country in the West Asia region. The public transport system is not well-developed. Most people like to drive by car. The government has given high subsidies for fuel oil, and the cost of keeping a car is very low, which also stimulates the desire of the public to buy cars. At the same time, Iran does not impose a stipulation on scrapping cars. Many cars are 25 years old or older. Four- and fifty-year-old cars are seen everywhere in Iran, causing chaos in Iran's traffic and serious urban air pollution. The government is eager to change this situation. To this end, the Iranian government attaches great importance to the development of the automobile industry and has made considerable progress in recent years.
At present, Iran has a total of more than 400 auto parts companies and 230,000 employees, and over 30 auto assembly plants. Iran has become a major automobile assembly and production country in West Asia and the Gulf region. At present, most of Iran’s taxis are designed by their own country, and the engines are produced by France. Compared with other countries, Iran has suffered from slow development of automotive technology due to sanctions imposed by the United States and its allies. This situation has created opportunities and conditions for Chinese cars to enter Iran.
Chinese cars develop rapidly in Iran
Although Chinese cars entered the Iranian market late, they have developed rapidly. Chery Automobile was the first to enter the Iranian market. As early as the beginning of 2003, Chery had cooperated with Iran’s Tossan Abad Automobile Company to assemble and sell QQ cars. The streets of Tehran once could see many QQ car ads. Although its price as high as 7,500 US dollars exceeded the psychological expectations of Iranian consumers, sales performance has been poor, but through QQ cars, Iranians began to understand the Chinese cars. In September of this year, Chery contacted Iran’s Hudro Group, Iran’s largest auto group, to prepare and manufacture 60,000 Chery A15 models in Iran. At the same time, the two sides will also set up a joint venture company to introduce Chery’s unannounced new car into Iranian production. The pre-sale price will be around US$6,000 and the annual output is expected to reach 100,000 units.
Chery has a strong momentum in the Iranian auto market and other Chinese auto companies have followed suit. In May 2003, FAW Group signed an agreement with the Iranian car company to establish a production line with an annual output of 1,000 trucks and 50,000 cars in Isfahan, Iran. In July 2004, Dongfeng Company and Iranian Sapa Company signed a contract for the export of 400 commercial vehicles to Iran. In the year of 2006, the pace of Chinese cars entering the Iranian market has accelerated markedly and historic breakthroughs have been made. In February, China National Heavy Vehicle Group and Iranian Automobile Company signed a $350 million auto export contract and will sell 10,000 heavy vehicles to Iran. In September, Foton Motor also reached a project cooperation agreement with an Iranian company, which will export the first batch of 5,000 pickup trucks to Iran for assembly and production of the entire vehicle.
Iranians are very contradictory to Chinese cars
As China's reform and opening up move forward, the Chinese auto industry has considerable competitiveness in terms of technology, product quality, price, etc., and it is very suitable for the consumption level of the Iranian market and is favored by the Iranian people. However, Iranian auto industry people have complained about the entry of Chinese cars. Iran’s domestic auto parts manufacturers’ association expressly opposes the establishment of auto assembly lines in China by Chinese automakers. It criticizes the government for allowing certain short-term gains to allow Chinese manufacturers to assemble low-cost economical cars in Iran and damage Iran’s auto industry. . Some Members even said that the parliament should request the Ahmadinejad government to strengthen the control and supervision of Chinese cars. The Industrial and Mining Commission of the Iranian Parliament also stated that it will arrange for experts to further inspect the Chinese trucks entering the Iranian market.
Sasan Kerbani, a member of the board of directors of the Iranian Automobile Parts Manufacturers Association, said that Iran’s auto market will not be easily handed over to foreign car manufacturers unless all components of Chinese cars are produced within Iranian territory to provide employment opportunities for Iranians. Mehdi, chairman of the Iranian Industrial Development and Reform Organization, also said: “The companies that are rushing to Iran must show sincerity. We are actively opening up to foreign capital, but investors must have long-term plans, if they just want to get a vote and leave, That's why the Chinese auto companies want to gain a firm foothold in Iran. They should also cooperate with local companies and take the path of "joint development, joint production, and joint sales."
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