A Glimpse on Iran’s Car Portfolio from Day One

Khodrocar – Iran’s automotive industry began its activity by assembling and producing Jeep’s military cars. However, exploring this industry shows that by continuing its activity, tendency of this industry shifted into few special directions. Therefore, the history of automotive industry can be divided into 4 periods: Pahlavi, 60s, 70s and 80 until today.

Pre-Revolotion: An Open Market
From the beginning of the automotive industry's activity in 1335 to 1357, the Iranian automobile industry was a freelance and diverse market. For sure, Iran had the most divers car market with high qualities and competitive atmosphere at that time.

It is obvious that the American car companies were the pioneers of this industry in Iran. Brands like Mercedes Benz, Citroen, Lotus and Nissan played an important role in automotive industry those times.

Farbod Zaveh, automotive industry expert tell Khodrocar regarding the issue: "In the pre-revolution period, the car market was more competitive and car import was free. Also political relations and purchasing power was stronger. This combination led to the imports of high quality foreign cars to Iran. In addition, General Motors decided to build its first advanced production line and export some of its products via Iran to neighbor countries. This was not necessarily linked to good political relations between countries.

80s: Japanese Entrance
Early in the pre-revolution period, United States gave up Iranian automotive industry; the economic situation in the country has led to a sharp drop in people’s purchasing power. The industry was managed by government and there was no choice but to accept the Japanese.

Zaveh says: "Japanese entered Iran even before the revolution but they never showed their potentials and just owned the private sector. The most important reason for the Japanese presence in Iran was the bilateral trades and oil. Therefore, the Iranian automobile industry was essentially based on political relations”

90s: French Dominance
By producing the first Peugeot 405 in 1989 and Kia Pride in 1993, these two economic cars expanded in the market. Pride was an economic car with low fuel consumption and depreciation while 405 have been chosen as the best car of Europe in 1988. It was said that this two could open new gates for Iran’s automotive industry but political events made everything unpredictable.

These two car are still being produced with low quality.

2000's Onward
In the early years of this decade, Chinese decided to improve their automotive industry, and Iran was the best choice for them. By inking few contracts with Iranian business partners, their automotive industry boomed and now they have one of the most diverse car markets in Iran.

In the late years of 2000 era, French decided to renovate some of their products in Iran like Peugeot 206, but some political events and first round of sanctions made them leave Iran’s market. Now they second round is coming and even before its beginning, its negative effects are obvious.

Chinese will stay immune but the French will be affected.

Export market
After the revolution, Iran never succeeded in gaining a top position in the automotive industry and was never able to export good products.

Farbod Zaveh tells Khodrocar regarding the impact of politics on the export market of the Iranian automotive industry: "Completely domestic production has always damaged us and led to low quality cars and unreasonable pricing. Iranian were never able to export vehicle, even before the revolution. The reason is they are not good sellers.”

Sanctions can cause regression for Iran’s automotive industry like the past. We can call this new era "The Chinese Empire” due to their power in our market.


Khodrocar Reporter: Mostafa Anisi
Khodrocar Translator: Maziyar Jafarieh