(17 Feb 2017) LEAD-IN
Iran is playing host to an international car show for the first time in 11 years.
The event in Tehran has drawn manufacturers from Europe, the Middle East and Asia.
STORY-LINE
This striking yellow Renault sports car is just one of many on show at the Iran Auto Show at the Shahr Aftab International Exhibition Centre in Tehran.
Some 200 car manufacturers and producers of auto spare parts have come together for the event.
Representatives from South Korea, Japan, China, Turkey, France, Germany, Britain, Spain, Italy and Taiwan are all participating.
French carmaker Renault showcased three electric cars at the show:
"Renault plans to sell the three electric vehicles you see here in coming years if our country makes the necessary structures. It can help reduce air pollution", explains Davood Taghizadeh, Head of Marketing and After Sales Services at Renalut retailer Negin Khodro.
Iran has reduced import duties for hybrid cars to help combat a major issue with air pollution in big cities.
The significant international presence at the show was clearly helped by the landmark 2015 nuclear deal between Iran and world powers. Sanctions on Tehran were eased in exchange for it limiting its nuclear programme.
Suddenly international car makers started to consider Iran's lucrative car market.
Tehran resident, Morteza Davar says the car industry in Iran has been lacking in competition.
"Very high prices, low quality unfortunately. You have very limited choices, and when you do make a choice you have to accept all the manufacturers' terms. Unlike other countries where the consumer is first, here the manufacturers dictate what they want to customers."
Some local car retailers say they are already seeing the benefits of the easing of sanctions.
"Many doors were opened, and companies engaged with Iran more easily. We are feeling this with the two brands we represent. They trust us more, and our engagement has increased. They visit the country and provide technical training for our staffers. Consignments are being shipped to Iran more easily, we are seeing all of these after the nuclear deal", says Ali Shokoohi, Head of Marketing at Arian group.
Shokoohi says the nuclear deal has enabled his company to offer more competitive prices and attract more customers, as direct engagement with car makers has reduced costs.
However he indicates that Iranians still have trouble completing financial transactions, despite the promise to lift the banking sections.
"In some areas there is still room for progress, for example banking transactions and LCs are not still on the same level they used to be before the sanctions", he says.
Notably absent from the show were American car makers, which Iran's Minister of Industry, Mines and Commerce Mohammad Reza Nematzadeh says is unlikely to change anytime soon:
"We are not in touch with American car makers and they are not contacting us. Considering the current situation it is unlikely to start a partnership."
American cars were far more common in Iran before the 1979 Islamic Revolution but are now a rare sight.
However Nematzadeh says Iran is not too concerned about the lack of American car makers at the show:
"Fortunately there are enough car makers around the world, from the east to Europe, and we are working with them. We have recently started cooperating with Japanese, Korean and European car makers to manufacture cars in Iran", he says.
The Iran Auto Show runs until 18 February 2017.
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