Economy, Auto

Renault Aspires to Double Market Share

Renault Aspires to Double Market ShareRenault Aspires to Double Market Share

Renault aims to double production capacity and market share in Iran, as the country’s economy opens up after the removal of western sanctions.

“The company is aiming for 20% of Iran’s automotive market, up from 10% in 2012,” said Peyman Kargar, vice president of Renault’s Africa, Middle East and India region, and CEO of Renault Pars.

Speaking on the sidelines of a conference in London hosted by the Financial Times, Kargar said capacity will need to be doubled to reach the company’s midterm target.

In 2015, Renault sold 51,500 vehicles in Iran, giving it a market share of 4.8%. It currently sells three models and will explore others with its two partners, SAIPA and Iran Khodro, a spokeswoman was quoted as saying by Auto New Europe.

Iran’s large but outdated car sector is one of the most attractive industries to foreign investors who have flocked to Tehran since international sanctions were lifted in January following Iran’s nuclear deal with world powers.

Renault halted business in Iran three years ago to comply with trade sanctions.

PSA/Peugeot-Citroen and its long-time Iranian partner Iran Khodro will invest €400 million ($435 million) in the next five years to upgrade their auto plant near Tehran to produce 100,000 vehicles a year starting in late 2017, with the output eventually doubling.

The two companies’ collaboration was suspended by Peugeot in 2012 due to sanctions.

PSA believes Iran’s new car market could recover to 1.6 million autos in two years and reach 2 million annually by 2022.