Trade sanctions on Iran have been lifted following the successful negotiations over its nuclear program. The over one million strong market has been out of bounds for the last four years and is now expected to grow up to two million within a couple of years.
PSA Peugeot Citroen is touted to be ahead in the race after its local manufacturing partner Iran Khodro continued selling the 405 sedan and the 206 sub-compact cars even after Peugeot’s exit in 2012, under pressure from General Motors – a shareholder back then. Peugeot has already outlined plans to revive full scale operations with the latest technology and designs to capitalise on the headstart.
Volkswagen, the German giant, with its local partner – Kerman Khodro – is planning on an aggressive strategy for market penetration with its budget brands – Skoda and Seat. French carmaker Renault is also banking on continuing the legacy of their popular model ‘Logan’ while adding products to the portfolio that would cater to the new market preferences.
While American car manufacturers – Ford and General Motors – may take some time to navigate through the stricter sanctions for their countrymen, the low priced cars from Chinese manufacturers Chery and Lifan will offer stiff competition to all other OEMs.
India has always shared a good relationship with Tehran and this development should open new avenues for Indian manufacturers like Tata, Maruti Suzuki and Mahindra as well as exporters from India like Hyundai, Renault-Nissan and Toyota. It will be interesting to see the marketing strategies deployed by various auto manufacturers trying to grab a piece of the Iranian sales pie.
