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Iran Automobile Industry Analysis - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2020 - 2029
Market Report I 2024-02-17 I 70 Pages I Mordor Intelligence
The Iran Automobile Industry Market size is estimated at USD 37.96 billion in 2024, and is expected to reach USD 59.93 billion by 2029, growing at a CAGR of 9.57% during the forecast period (2024-2029).
The automobile industry in Iran witnessed a decline in growth due to the COVID-19 pandemic and sanctions imposed by countries like the United States on Iran. However, as the government in the country is taking the necessary actions to boost the production of vehicles and parts locally to meet the demand and reduce its import cost simultaneously, the market is expected to witness steady and consistent growth during the forecast period. The major car manufacturers in the country are increasing their production with locally manufactured parts and components. For instance,
Key Highlights
-In September 2022, IKCO, the largest car manufacturer in Iran, announced its first electric car for commercial purposes, which is set to be launched in March 2023. The IKCO technology arm Jetco has designed and developed this model with a battery pack of 45 kWh and can travel 300 km on a full charge.
Over the long term, local OEMs and major manufacturers in the country are also entering into agreements and associations with the university and research institutes to upgrade the manufacturing technology related to auto parts and components, which is expected to boost the market during the forecast period further. For instance,
Key Highlights
-In October 2022, Six memorandums of understanding were signed between Iran Khodro Industrial Group and Saipa Automobile Group. These agreements cover the supply and purchase of raw materials and parts and establish joint engineering and R&D centers for manufacturing automotive in the country.
With an annual production of more than 1.6 million vehicles, Iran is the world's 20th-largest automaker and one of the largest in Asia. Currently, Iranian manufacturers produce six different types of vehicles: passenger cars, 4WD, trucks, buses, minibusses, and pickup trucks. Passenger cars account for approximately 75% of local output, with pick-up trucks accounting for about 15%.
Iran Automobile Market Trends
Iranian Automobile Industry is Expected to Hold the Considerable Market Share in the Forecast Period
Iran, being the largest automotive market in the Middle East with a market of nearly one-third of German automotive players, has seen fluctuations in the automotive industry since 2012 due to the implementation of the sanctions. The international sanctions had a tremendous impact on the development of many industries in the country, including the automotive industry.
Despite the stringent lockdown and social distancing norms in the global scenario and the disturbing political geographies, Iran showed good numbers in automotive sales and production.
- In 2021, Iran produced approximately 838 thousand passenger cars. This represents an increase from 826 thousand passenger cars produced in 2020. Iran was the Middle East's leading passenger car manufacturer.
Moreover, with increasing demand for passenger cars in the country, the major OEMs are planning to launch the latest models.
- In August 2022, the Tara automatic car was announced and presented by Iran Khodro Industrial Group as the most modern and up-to-date car of domestic production in Iran. Iran Khodro was able to showcase its new products and capabilities to potential customers at this specialized automobile exhibition.
With an improving economy, the country is expected to experience a sales boom for medium-priced cars (such as sedans). The emergence of local automotive component hubs is expected to further contribute to the overall development of the passenger car segment of the market during the forecast period.
Latest Developments to Encourage Engine Manufacturers in the Iranian Automobile Industry
Iran's automotive engine and engine components market had a considerably fast growth in the past few years due to the population and the need for vehicles. In its 2025 grand economic plan, Iran plans to become the number one automotive industry in the Middle Eastern region, aiming to rank fifth in Asia and eleventh globally.
Primary factors contributing toward the increase in production activity in auto parts and components are the government's support plans for the auto sector, increasing skilled and educated workforce, and the massive potential for private sector investments.
The home-grown car industry in Iran has pushed manufacturers to invest and develop their engines without any partnership with foreign players. As EV adoption is in its early stages, the market is expected to grow positively during the forecast period. Key players in Iran are also focusing on developing EVs in the country. For instance,
- In January 2021, Iran's most prominent automotive firm, the Iran Khodro Company (IKCO), unveiled a domestically-made three-cylinder engine, EC5.
Therefore, owing to the above-mentioned factors, the engine segment is expected to witness positive growth over the forecast period.
Iran Automobile Industry Overview
Iran's automobile industry is a moderately consolidated market. Many major local players in the country, such as IKCO, SAIPA, Pars Khodro, Kerman, and Bahman, manufacture various models (such as Samand, Tiba, Dena, etc.). IKCO and SAIPA are the biggest automotive manufacturers. Many players are in planning to ramp up production output in the coming years.
- In October 2022, Iran Trade Promotion Organization (TPOI) announced the opening of an auto production line in Armenia to export manufactured cars to the Eurasian Economic Union (EAEU) states.
Additional Benefits:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
1 INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
4.1 Market Drivers
4.2 Market Restraints
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
5.1 By Vehicle Type
5.1.1 Passenger Cars
5.1.2 Commercial Vehicles
5.1.3 Motorcycles
5.2 By Manufacturer Type
5.2.1 Auto Ancillaries
5.2.2 Engine
5.2.3 Other Components
6 COMPETITIVE LANDSCAPE
6.1 Vendor Market Share
6.2 Company Profiles
6.2.1 Automobile Manufacturers
6.2.1.1 Iran Khodro (IKCO)
6.2.1.2 Pars Khodro
6.2.1.3 SAIPA Corporation
6.2.1.4 Renault Pars
6.2.1.5 Volkswagen Group
6.2.1.6 Hyundai Motor Company
6.2.1.7 Kia Motors Corporation
6.2.2 Auto Component Manufacturers
6.2.2.1 Sazeh Gostar
6.2.2.2 Bahman Group
6.2.2.3 Monavari Brothers Industrial Group
6.2.2.4 SAPCO
6.2.2.5 IPMC
7 MARKET OPPORTUNITIES AND FUTURE TRENDS
8 GOVERNMENT INITIATIVES IN THE IRANIAN AUTOMOTIVE MARKET
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