Iranian Car Manufacturing Industry Strives to Pick Up Speed
Iran's recently launched a two-door sport utility vehicle aimed at younger drivers at home and abroad - and the release may provide the 'slow' car manufacturing industry with a much needed spark.
The new $10,000 vehicle, entitled, 'Sinad,' is the first offering from Kish Khodro Company, a joint venture based on the Gulf island of Kish, one of three free-trade zones established to attract foreign investment.
Private Iranian investors possess 51 percent of Kish Khodro stock, while a state development bank owns 40 percent. BMS Management, a British engineering group that designed the new car, has a nine-percent stake.
Kish Khodro began the $11 million Sinad project with an initial production target of 5,000 SUV's a year, climbing to 15,000 per year in the future, remarked Company Chairman Mohammad Safari. French car-manufacturing giant, Renault, signed an agreement with the Kish plant in December 1999, to supply parts for the Sinad model.
''Since the (1979) revolution, this is one of the very few private ventures that has succeeded in car production,'' declared Industry Minister Gholamreza Shafei at the vehicle's kickoff ceremony.
Besides BMS's Kish Khodro project, Germany's Mercedes Benz joint venture to manufacture trucks in Iran, is the only other foreign endeavor to join with an Iranian car-manufacturing firm. Iran Khavar, has produced commercial vehicles with allied Mercedes for approximately 30 years.
Under rules governing the free-trade zones, Kish Khodro must export a minimum of 30 percent of its vehicles. Nonetheless, the company intends to capitalize on the swelling local demand for sporty automobiles.
Company spokesmen relayed that the Sinad's gas emission levels are lower than other domestically made cars. The cars also feature the SUV's fuel efficiency, with its fiberglass body and maximum output of 90 horsepower. A four-door model will be released in the near future, the Iranian press reported.
Although Iran's car industry is largely undeveloped and remains under state control, the government has pledged a $1 billion investment to develop the state of the car production industry. The nation's automobile vehicle production is geared for local consumption, with just $30 million worth of vehicles exported per year. The leading car manufacturers -- Iran Khodro and Saipa - produce a combined 250,000 cars per year, and intend to increase the figure to 500,000 over the coming 3 years.
Iran Khodro (IK), which rules 65 percent of the Republic's car industry, assembles certain models of France's Peugeot, as well as the Peykan, the Iranian version of the old Hillman Hunter (produced locally for almost 40 years). IK recently signed an agreement for the construction of the Peugeot 205.
© 2000 Mena Report (www.menareport.com)
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