Iran’s major automaker SAIPA has taken another step for localizing and technologically upgrading its auto production by forging contracts with 48 knowledge-based and tech companies.
During a press conference on Wednesday, SAIPA’s CEO Seyyed Javad Soleimani said the company has recently signed a contract with 48 tech firms and knowledge-based companies to boost the localization of auto parts, ISNA reported.
The deals mostly deal with the production of high-tech auto parts that are usually imported.
According to Soleimani, the domestic auto industry has invested in self-sufficiency over the past several years, though there are shortcomings in the production of technologically sophisticated parts.
“The initiative is expected to curb the company’s reliance on foreign suppliers,” he said.
SAIPA’s CEO said the consolidation of ties with knowledge-based companies is high on his agenda since it is the shortest and most efficient way of bridging the technological divide in the auto industry.
He also invited startups and tech firms working in the automotive field to introduce their innovative ideas.
“Novel solutions will definitely be welcomed and implemented,” he added.
SAIPA’s previous move for upgrading its products with the state-of-the-art technology was in late June, when the company started a joint initiative with the University of Science and Technology.
Soleimani and Mohammad Hossein Shojaeifard, the dean of the university’s research faculty, signed a deal on establishing a specialized taskforce to design joint projects, attract university graduates as technical and scientific advisors, conduct research using university facilities and strengthen the role of academia in SAIPA’s new projects.
They also discussed ways of expanding collaboration for the benefit of both sides.
SAIPA intends to seek the help of university graduates, professionals and tech units to systematically upgrade technologies used by the auto industry and to overhaul automotive production lines.
Auto industry managers believe that the academia, tech ecosystem and the auto industry can forge ties to protect the domestic economy from the headwinds caused by US sanctions.
Key Triggers
Curbing reliance on foreign resources has been the prime objective of Iran’s economic sectors, including auto production, which has compelled the two major automakers, Iran Khodro Company (IKCO) and SAIPA, to forge ties with the academia.
In mid-May, IKCO said it is starting cooperation with the Electronics Support Fund for Research and Development to upgrade its production facilities.
Affiliated with the Ministry of Industries, Mining and Trade, the fund is geared toward connecting knowledge-based companies with major industrial units, helping both to develop their businesses.
In February, Iranian auto parts manufacturer SAPCO signed multiple agreements with domestic knowledge-based companies, as part of efforts for minimizing dependency on foreign suppliers.
SAPCO, which is a major parts supplier for IKCO and SAIPA, signed 80 agreements with tech firms in a wide range of fields, including the production of electronic stability control system, hydraulic wheel for IKCO's Peugeot 206 model and refrigerant gas used in vehicles' cooling system.
The deals were signed during an earlier tech event held in Tehran.
During the event, IKCO introduced 219 technological requirements of its production line and invited tech units to offer smart solutions.
Defense Ministry’s Cooperation
Iran’s Defense Ministry has also extended help to bolster automotive productivity and curb reliance on foreign auto part suppliers.
In early June 2019, the ministry started to share its technological capabilities with local car companies. With the ministry's support, homegrown substitutes for key imported car parts were supposed to be produced in Iran to curb the industry’s reliance on the global supply chain.
At present, IKCO has contracts with several ministry-affiliated firms and nine knowledge-based companies in 29 auto production projects.
According to IKCO, these collaborations have resulted in the localization of 51 key auto parts, preventing the capital flight of up to €127 million per year, which figure will further increase when the new agreements come on stream.
In December 2019, IKCO signed a deal to utilize the technical and engineering expertise of eight industrial companies affiliated with the Defense Ministry.
The initiative to increase the share of domestic auto part production was first launched by the Industries Ministry that also hailed similar moves by other carmakers.
IKCO has signed several agreements with domestic small- and medium-sized enterprises since last fiscal year (started March 2019) to mass produce 32 other auto parts, which are expected to save up to €16.7 million annually.
Industrial experts hope that the efforts will yield sustainable benefits for the domestic auto industry.
