SEAT Says Looking to Come to Iran

Volkswagen’s Spanish subsidiary Seat is considering officially selling its cars in Iran to broaden its reach beyond the crowded European market, its chief executive said on March 7.

Seat has been invited by the Spanish government to explore opportunities in Iran but entering the market would require major investment and only work in conjunction with Seat’s German parent VW, Chief Executive Luca de Meo told Reuters.

“It’s not a market where we can go alone,” de Meo said at the Geneva auto show. “We have to see what our sisters and brothers are doing. We are analyzing the situation but nothing concrete is on the table.”

Volkswagen previously signed a deal with Iran’s Mammut Khodro, a subsidiary of Mammut Group which produces trucks from VW’s subsidiary SCANIA.

Earlier this week, several VW models were photographed at Tehran’s Imam Khomeini International Airport (IKIA) after being air freighted as part of the Mammt deal.

Meanwhile another Iranian company imported a limited range of SEAT models in October, the Financial Tribune reported at the time.

Keyhan Motor Aryan, the self-styled official representative of SEAT, launched the presale of the car in two models, one with a 1.8-liter Audi-derived engine and another with a 1.4-liter VW engine last year, however further reports of the company’s progress has been fleeting since then.

Amir Attar-Nejad, the head of the company’s public relations office, told Financial Tribune in October that the presold models will be delivered before the end of the current fiscal year that ends on March 20.

 Expanding Sales, After-Sales  Services

According to the company official, the 1.8-liter Leon is priced at $41,000 (1.43 billion) and the 1.4-liter model at $35,000 (1.2 billion rials). This is while the same model is priced at $25,000 (875 million rials) in the EU.

The company has two sales and after-sales service centers in Tehran and is planning to open three other offices in other cities.

However, according to that company’s website, keyhanmotor.com, the firm lists not only SEAT vehicles but also Honda models.

French carmakers once dominated the Iranian market and both PSA and Renault are ramping up investment and production after the easing of international  sanctions in January 2016.

Western and Japanese carmakers that had previously avoided Iran are also eyeing its potential.

Internationalization will be a key topic for Seat in the coming years as the brand, which is traditionally strong in Mediterranean markets, is counting on new models to boost profits, de Meo said.

Seat will also start making vehicles in Algeria later this year as part of VW’s joint venture with local car importer SOVAC, the CEO said.

“We have not yet fully exhausted the Mediterranean’s potential,” de Meo said. “The most natural area of expansion for us would be Central and South America.”