Economy, Auto

Dongfeng Auto Presales Begin

Dongfeng Auto Presales Begin
Dongfeng Auto Presales Begin

Iran Khodro, Iran's oldest and largest national automotive producer, will start presales of Dongfeng vehicles  in the second half of the current Iranian year (started March 21), the company's sales and marketing deputy, Mostafa Khankarami, said.

 He did not, however, say which of the company's models will be sold in Iran, or whether they will be produced by complete knock down or fully by IKCO, Donyaye Khodro reported Sunday.

Dongfeng Motor Corporation is a Chinese automobile manufacturer. Along with Chang'an Motors, FAW Group and SAIC Motor.

Dongfeng is currently among the top four Chinese carmakers. The company produces a range of trucks, buses, MPVs and passenger cars with a growing overseas market in 2015.

The announcement of the Dongfeng deal has got auto market watchers in Iran enthused about the latest deal with IKCO.

In April 2015, Dongfeng signed a new production agreement, with PSA Peugeot-Citroen, Iran Khodro's long-term auto production partner of the past 40 years. In that agreement Dongfeng would begin production of a range of new Peugeot cars and joint platform vehicles.

At a news conference in April, at China's largest auto show, Shanghai Auto, the two said they would invest €200 million ($216.1 million) to develop a common platform for both companies’ next generation of small and midsize cars.

Peugeot sales in the Chinese market rose to 734,000 cars in 2014, up 66% from 2012. The jump in China business came as sales in Europe continued to stall due to a slow European economic recovery and struggling sales in Iran.

But, this latest signing with a Chinese automaker may cause further friction with traditional players in the Iranian market. In May, members of the Iranian Auto Parts Manufacturers' Association said Chinese cars are of lower quality compared to European competitors and buyers will not welcome the idea of buying them.

Financial Tribune previously reported that Iran Khodro's main competitor Saipa already signed a contract with Brilliance Auto of China.In their recent deal, Saipa will produce CKD's  of Brilliance's H230 and H330 hatchback and sedan models. The second automotive conglomerate is also expected to grow its market share by producing other Chinese models in the coming months.