Economy, Auto

German Auto Giants Moving In

German Auto Giants Moving In
German Auto Giants Moving In

One of the most important outcomes of talks between German automakers and their Iranian counterparts has been that German auto giants have shown interest in investing in Iran, said a member of the Board of Directors of Iranian Automotive Parts Manufacturers Association.

Mohammad Reza Najafi-Manesh made the remark at a press conference held on Tuesday.

During the session, several Iranian automotive officials announced the details of recent talks with the German business delegation that recently visited Iran, IRNA reported.

Headed by Germany's Vice Chancellor and Economy Minister Sigmar Gabriel, the German business delegation arrived in Tehran on Sunday. Representatives from German auto giants Daimler-Mercedes and Volkswagen met with Iranian automotive officials to expand business ties.  

Najafi-Manesh said Iran's auto manufacturing industry must make the most of this opportunity.

He clarified that as opposed to the past, the Iranian delegation now has a commanding position in talks.

"The Germans are on board with our conditions for starting joint ventures," he said.

"The presence of Germans in Iran happened only after the Comprehensive Joint Plan of Action was drafted. These sessions have been effective and productive."

Najafi-Manesh noted that Iranians want automotive cooperation to be largely in the form of investment, 40% of production must be carried out inside Iran and 30% of vehicles must be exported.

"Currently, the global trend in the auto industry is moving toward mergers among auto manufacturers. To keep up with this trend, Iran must logically join forces with global automakers and establish business partnerships as well," he said.

Najafi-Manesh stressed that Iranians "have nothing against imports. However, imports need to be moderated so that they do not harm local manufacturing.

"The current import situation is unacceptable," he added.

Currently, more than 37% of the vehicles in the domestic market are imported, which needs to be corrected for the local industry to get back on track.

The official also said a 70-member Iranian team, headed by Iran's Minister of Industries, Mining and Trade Mohammad Reza Nematzadeh, will soon travel to Vienna to hold talks with European businesses interested in starting operations in Iran.

"The government should create a specialized auto team to negotiate a deal, mainly focusing on addressing the sanctions on the auto industry," he said.

Najafi-Manesh concluded that for effective policymaking and monitoring in the industry, specialized auto exhibitions should be organized by related guilds.   

Also present at the event was director general of guilds affiliated to Iran Chamber of Commerce, Industries, Mines and Agriculture, Hooman Hajipour.  Hajipour noted that "the German vision goes beyond the Iranian market of 70 million people. They aim to take over the larger regional market of 300 million people in the Middle East through Iran."

"This is also a good opportunity for Iran's automakers' associations to improve their operations," he said.

Hajipour highlighted the importance of attending the upcoming International Motor Show (IAA) in Germany. The 66th edition of IAA will be held in Frankfurt from September 17 to 27.

"This is a great opportunity for small- and medium-sized enterprises from Iran to take productive measures in identifying potential German business partners," he said.    

Head of Iran's Vehicle Importers association, Farhad Ehteshamzad, said Iran will be attending IAA for the first time this year.

He hailed the event as a great opportunity for "boosting bilateral cooperation in the auto sector."

Ehteshamzad elaborated on talks with the German delegation and said, "They know that the Iranian market is replete with investment opportunities."

Apart from joint ventures, the official noted that the highlights of talks included sharing automotive know-how.

"In order for the officials to take a final decision, Iran-Germany Chamber of Commerce will start an assessment and feasibility study to investigate the preconditions for cooperation," he said.