Daimler Trucks setting the course for a return to the Iranian market
STUTTGART/TEHRAN — Daimler Trucks, the world’s leading truck manufacturer, is setting the course for a return to the Iranian market, having signed letters of intent with its local co-operation partners Iran Khodro Diesel (IKD) and the Mammut Group.
Daimler AG has already had successful business relations with IKD for the past 50 years. IKD is a subsidiary of Iran Khodro Industrial Group, the largest vehicle manufacturer in the Middle East and North Africa (Mena) region having more than 50% market share in Iran and has been co-operating with Daimler for over half a century.
The areas of co-operation include a joint venture for local production of Mercedes-Benz trucks and powertrain components plus the establishment of a sales company for Mercedes-Benz trucks and components. Furthermore, there are plans for Daimler to return as a shareholder in the former engine joint venture Iranian Diesel Engine Manufacturing Co. (IDEM).
In addition to this, both partners are looking at establishing a joint venture for local sales of Mercedes-Benz commercial vehicles. Daimler and IKD are about to benefit from each other’s competitive advantages to satisfy the large demand for trucks. In the short term, therefore both parties have a strategic alliance on a win-win basis through joint ventures in their scope.
Dr Wolfgang Bernhard, member of the board of management of Daimler AG, responsible for Daimler Trucks and Buses said: “Daimler commercial vehicles have always had an excellent reputation in Iran. And right now, there is a huge demand for commercial vehicles, especially trucks. We plan to quickly resume our business activities in the market there. The signing of the letters of intent with our local partners IKD and Mammut Group are important pre-requisites to resume business quickly.”
With its growth potential following many years of sanctions and the pent-up demand in the transport sector, Iran offers promising opportunities for Daimler Trucks.
Despite the sanctions, Iran was one of the largest national economies in the Middle East, with a nominal gross domestic product (GDP) of $415 billion in 2014. Industry accounts for almost half of the Iranian national economy.