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Iranian Automotive Market, Forecast to 2022

  • Report

  • 102 Pages
  • February 2018
  • Region: Iran
  • Frost & Sullivan
  • ID: 4471574

Sales Volume of Passenger Vehicles, Commercial Vehicles, and Buses and Minibuses to Reach 2.61 Million Units by 2022

The Iranian passenger vehicles (PV) market is projected to grow, recording a compound annual growth rate (CAGR) of 13.6% during 2016-2022 with the potential lifting of sanctions and the entry of foreign original equipment manufacturers (OEMs) and suppliers. By 2022, the B segment, with a 46% market share, will be most preferred segment cannibalising on the D segment for its value-added features. The B and D segments are dominated predominantly by Iranian OEMs and locally built cars, whilst the premium segments include foreign participants.

The Iranian government has introduced strong initiatives to cut emissions and modernise the car park, which provides strong opportunities for local production. Iran disposed of about 320,000 ‘end of life’ PVs as part of its scrappage programme in 2015 to reduce pollution and fuel consumption. The country plans to decrease the average passenger parc age to 20 years by the end of 2020 and to 15 years by the end of 2025.

IKCO and SAIPA have a dominant position in the PV parc. The Light Duty Truck (LDT) market is fragmented amongst three state-controlled OEMs that operate across all segments. IKCO and SAIPA have more than 90% market share in the LDT segment. The domination of pickups and vans in the LDT segment will be challenged with the increasing penetration of COE trucks from Japanese brands. In the Medium and Heavy Duty Truck (M&HDT) segment, Bahman and SAIPA have a share of more than 70%. Iranian government initiatives towards the opening up of the mining sector for foreign investors will drive the demand for commercial vehicles in the mining and construction segment. Foreign brands such as Dongfeng, IVECO, and Volvo dominate the HDT segment due to the higher tonnage and power requirements. Local brands are preferred for distributing lighter materials.

Due to its strategic location, Iran has the potential for accounting for a substantial share of international transit trade with the development of proper infrastructure. According to the 6th Development Plan, the country aims to construct over 1,500 km of free highways. At present, Iran has over 2,400 km of freeways, which are expected to increase to over 4,000 km by the end of 2020. Additionally, the country seeks to support knowledge-oriented enterprises for new and advanced technology development. The aim is to achieve a 4% research and development (R&D) contribution to the country’s gross domestic product (GDP).

The government plans to encourage producers to allocate 25% of their revenues to R&D activities in future. Foreigners will receive extra tax exemption if they can export 30-40% of their products out of Iran. Iran’s seven free trade zones (FTZs) are placed at strategic geographical locations to act as hubs for imports and exports. Special bylaws regulate import, export, investment, banking, and labour laws.

Research Scope:

This research report includes following segments:

  • Passenger Cars
  • Light duty truck (LDT)
  • Medium duty truck (MDT)
  • Heavy duty truck (HDT)
  • Bus

Research Benefits:

What makes our reports unique?

  • We provide the longest market segmentation chain in this industry
  • We provide 10% customization. Our customization will ensure that you necessarily get the market intelligence you are looking for and we get a loyal customer
  • We conduct detailed market positioning, product positioning, and competitive positioning. Entry strategies, gaps and opportunities are identified for all stakeholders

Key Issues Addressed:

  • What is the condition of the domestic automotive market in Iran? How automotive market is expected to evolve over time?
  • What is the economic and political situation in Iran and what are the social and technology trends affecting the country and the automotive industry?
  • What is the business environment and what kind of investment opportunities does the country have to offer to a potential investor?
  • What is the condition of the road and fuel infrastructure network in Iran?
  • What are the key policies, taxation regulations and economic incentives in the automotive industry?

Table of Contents

1. Executive Summary
  • Executive Summary-Key Takeaways
  • Executive Summary-Automotive Sector in Iran: A Snapshot
  • Executive Summary-Passenger Vehicles Market Breakdown by OEMs
  • Executive Summary-Automobile Market: Areas of Growth
  • Executive Summary-Findings and Future Outlook

2. Research Scope, Objectives, Background, and Methodology
  • Research Scope
  • Research Aims and Objectives
  • Vehicle Scope and Definitions in Iran
  • Key Questions this Study will Answer
  • Research Background
  • Research Methodology

3. Key Country Facts
  • Iran-Mega Trends
  • Iran-Key Macroeconomic Figures
  • Iran-Demographic Trends
  • Iran-Political and Historical Background
  • Iran-Geographical View
  • Iran-Road Network
  • Iran-Fuel Infrastructure
  • Investment Climate-R&D Incentives
  • Investment Climate-Cost of Doing Business
  • Free Trade Zones
  • Investment Climate-Trade Policies
  • Technology Agreements
  • Automotive Market-Policies in the Country
  • Automotive Industry Hourly Wages
  • Passenger Vehicles-Taxation Structure
  • Used Vehicle-Trade Regulations
  • Passenger Vehicles-Market Special Conditions

4. Automotive Sector-Basic Indicators
  • Passenger Vehicles (PV)-Parc
  • Passenger Vehicles-Market Trends
  • Commercial Vehicles (CV)-Parc
  • Commercial Vehicles + Buses and Minibuses-Market Trends

5. Market Structure
  • Passenger Vehicles-Segmentation
  • Passenger Vehicles-Key Models
  • Passenger Vehicles-Customer Needs
  • Commercial Vehicles + Buses and Minibuses-Key Models
  • Commercial Vehicles + Buses and Minibuses-Customer Needs
  • Iran Auto Components Production Map
  • Passenger Vehicles-Unit Shipment Forecast
  • Passenger Vehicles-Unit Shipment Breakdown by OEMs
  • Passenger Vehicles-Unit Shipment Forecast by Vehicle Segment
  • Passenger Vehicles-Percent Unit Shipment Forecast by Powertrain
  • Passenger Vehicles-Percent Unit Shipment Forecast Transmission
  • Passenger Vehicles-Percent Unit Shipment Forecast Fleet Ownership Structure
  • Commercial Vehicles-Unit Shipment Forecast
  • Commercial Vehicles-Unit Shipment Forecast by Vehicle Segment
  • Commercial Vehicles-Percent Unit Shipment Breakdown by Vehicle Segment and Powertrain
  • Commercial Vehicles-Percent Unit Shipment Forecast by Wheelbase
  • Commercial Vehicles-Percent Unit Shipment Forecast by Intended Use
  • Buses and Minibuses-Unit Shipment Forecast
  • Buses and Minibuses-Percent Unit Shipment Forecast by Vehicle Segment
  • Buses and Minibuses-Percent Unit Shipment by Powertrain
  • Buses and Minibuses-Percent Unit Shipment Forecast by Tonnage
  • Buses and Minibuses-Percent Unit Shipment Forecast by Wheelbase
  • Buses and Minibuses-Percent Unit Shipment Forecast by Intended Use
  • CV + Buses and Minibuses-Sales Channels
  • Commercial Vehicles + Buses and Minibuses-Fleet Sales Analysis
  • Commercial Vehicles + Buses and Minibuses-Sales Network
  • Commercial Vehicles + Buses and Minibuses-Vehicle Body Producers

6. Pricing
  • Passenger Vehicles-Top-selling Models
  • Passenger Vehicles-Financial Solutions
  • Average Prices-Commercial Vehicles + Bus + Minibus
  • Commercial Vehicles + Buses and Minibuses-Financial Solutions

7. Special Focus-Passenger Vehicles: Sales and Aftersales Services Market
  • Passenger Vehicles-SAIPA: Business Model
  • Passenger Vehicles-Distribution Channel Structure
  • Passenger Vehicles-OEM and Aftermarket Distribution Network
  • Aftermarket Distribution Structure

8. Competitor Analysis
  • OEM Competitive Analysis
  • IKCO-Diesel
  • SAIPA Diesel

9. Growth Opportunities and Companies to Action
  • Growth Opportunity-Growing Segment and Alternative Technology
  • Strategic Imperatives for Success and Growth

10. Conclusions and Future Outlook
  • Key Conclusions
  • The Last Word-3 Big Predictions
  • Legal Disclaimer

11. Appendix
  • Abbreviations and Acronyms Used
  • Market Engineering Methodology
  • List of Exhibits

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Bahman
  • Iran Khodro
  • Oghab Afshan
  • Otokar
  • Saipa