iran – a historic opportunity for automotive oems ?· well as gold, precious metals and...

Download Iran – A historic opportunity for automotive OEMs ?· well as gold, precious metals and diamonds,…

Post on 25-Mar-2019

212 views

Category:

Documents

0 download

Embed Size (px)

TRANSCRIPT

An overview of the key success factors for automotive OEMs entering the Iranian market

Munich, March 2016

Iran A historic opportunity for automotive OEMs

2 Roland Berger_Iran_A historical opportunity_Final.pptx

Your Iran experts at Roland Berger

Philipp Grosse Kleimann

Senior Partner Munich

+49 89 9230 8718 philipp.grossekleimann@rolandberger.com

Alexander Brenner

Principal Hamburg

+49 40 37631 4318 alexander.brenner@rolandberger.com

Santiago Castillo

Principal Dubai

+971 4446 4080 santiago.castillo@rolandberger.com

3 Roland Berger_Iran_A historical opportunity_Final.pptx

Contents Page

A. Iran Status quo 5

B. Why enter the Iranian market 6 opportunities for growth 11

C. How to enter the Iranian market 9 key success factors 20

D. What to do now Next steps 31

4 Roland Berger_Iran_A historical opportunity_Final.pptx

Management summary

Source: Roland Berger

A

Iran Status quo

> Iran is the 18th largest economy globally with a positive trade balance and strong focus on oil products and car manufacturing

> IAEA confirmed that Iran met the relevant requirements under the JCPOA and all nuclear sanctions were lifted on January 16, 2016

B Why enter the Iranian market 6 opportunities for growth

> Lifting of major sanctions provides a historical opportunity for foreign automakers to re-enter the attractive Iranian automotive market 6 opportunities for growth

C How to enter the Iranian market 9 key success factors

> OEMs need to thoroughly understand the national specifics before entering the Iranian market 9 key success factors identified

D

What to do now Next steps

> Think: Thoroughly understand the Iranian market and analyze the existing dealership network

> Act: Decide on whether to take a greenfield approach or to partner with a local dealership network and define for each model a CBU vs. SKD/CKD strategy

5 Roland Berger_Iran_A historical opportunity_Final.pptx

A. Iran Status quo

6 Roland Berger_Iran_A historical opportunity_Final.pptx

As populated as Germany, Iran is the world's oldest country, boasting a sophisticated education system and excellent growth potential

Source: Goldman Sachs; Boston Consulting Group; UN population division; World Bank; CIA World Factbook; Roland Berger

Key facts and figures

Iran is almost as populated as Germany > Iran ranks 19th in the world in terms of population, only 150,000 inhabitants short of Germany

in 18th place (July 2014). Also, Iran's population is relatively young with a median age of 28.3 in 2014 (Germany: 46.1)

Iran is the oldest country in the world today > Iran's history as a nation dates back to 3,200 BC, making it the oldest country

in the world today

> All of this has been entirely witnessed by Sarv-e-Abarkooh, the world's third oldest tree at over 4,000 years of age

Iran is one of the "Next-11" countries > Goldman Sachs identified Iran as one of the Next-11 countries offering the best growth

potential beyond BRIC nations. It is estimated that growth of the Next-11 countries will outperform Triad and BRIC markets in the coming years

Iran has 2nd largest university globally and more female than male students > The Islamic Azad University Tehran is the 2nd largest university in the world with 2 m

students. Iran also has the best educated population in the Middle East & North Africa

> In 2012, approximately 60% of enrolled university students were female

7 Roland Berger_Iran_A historical opportunity_Final.pptx

Iran is centrally located between the Caspian Sea and Indian Ocean Major cities are Tehran, Mashhad and Isfahan

Source: Statistical Centre of Iran; Roland Berger

Geographical overview

Markazi

Hormozgan

Ilam Lorestan

Chahar Mahall/

Bakhtiari Khuzestan

Isfahan

Yazd

Kohgiluyeh/ Buyer Ahmad

Fars

Bushehr

Kerman

Sistan and Baluchestan

South Khorasan

Razavi Khorasan

North Khorasan Golestan

Semnan

Qom

Tehran

Mazandaran

Qazvin

Zanjan

Hamadan

Kermanshah

Kordestan

West Azarbaijan

Gilan

Ardebil

East Azarbaijan

Ahvaz

Isfahan

Shiraz

Mashad

Qom Tehran

Orumieh

Tabriz

Karaj

Kermanshah

1) Based on 2011 census data 2) Share of total population

Capital Tehran, Tehran province

Country size ['000 km] 1,648.2

Top 10 cities

Tehran

Mashhad

Isfahan

Karaj

Tabriz

Shiraz

Ahvaz

Qom

Kermanshah

Orumieh

Inhabitants1) [m]

8.2

2.7

1.8

1.6

1.5

1.5

1.1

1.1

0.9

0.7

[%2)]

11%

4%

2%

2%

2%

2%

2%

1%

1%

1%

8 Roland Berger_Iran_A historical opportunity_Final.pptx

Iran is the 18th largest economy globally with a positive trade balance and strong focus on oil products and car manufacturing

Economic overview Iran in 2014

1) 2013 2) 2012

Source: International Monetary Fund; Oxford Economics; The Atlas of Economic Complexity; World Bank; World Economic Forum; Bloomberg; Roland Berger

Current account [USD bn]: 19.1

Current account balance [% of GDP]: 4.8

Foreign direct investment [USD bn]: 3.1

Currency: Iranian rial

Exchange rate IRR / EUR (avg.): 34,443.9

Exchange rate IRR / USD (avg.): 25,916.8

GDP [nominal USD bn]: 404

GDP per capita [USD]: 5,183

Population [m]: 78.5

Unemployment [%]: 10.31)

Global Competitiveness Index: 66th 2) Bloomberg Innovation Index: 47th 1) World bank GDP PPP based ranking: 18th

Exports (goods and services) [USD bn]: 95.3

Export of mineral products [% of total exports]:

842)

Most important export partners:

China, USD 22.0 bn2)

India, USD 12.0 bn2)

Main industries:

Petroleum, petrochemicals, fertilizers, vehicle manu-facture & parts

Imports (goods and services) [USD bn]: 81.0

Import of machinery and manufactured goods [% of total imports]:

552)

Most important import partners:

China, USD 11.0 bn2)

Turkey, USD 9.9 bn2)

9 Roland Berger_Iran_A historical opportunity_Final.pptx

IAEA confirmed that Iran met the relevant requirements under the JCPOA and all nuclear sanctions were lifted on January 16, 2016

Details on sanction status

1) Comprehensive Iran Sanctions, Accountability and Divestment Act 2) In 2010, Iran imported about 30% of its refined petroleum 3) Joint Comprehensive Plan of Action

Source: U.S. Department of State; U.S. Department of the Treasury; UANI; OMelveny & Myers LLP; Roland Berger

1997

2010

2013

2012 2014 2015 June

November March

January

2016

First sanctions imposed by USA

CISADA1) expanded sanctions on supply of petroleum products2). Further expansion of existing sanctions on imports or exports with value >100 USD allowed

Executive order 13645 authorizes a range of sanctions, also for non-US companies that continue to service the Iranian automotive industry (manufacturing side only). Non-US financial institutions are also subject of this Executive Act

Geneva Interim Agreement temporary suspension of nuclear program on Iranian side triggers suspension of sanctions in the Iranian automotive segment. Automakers subsequently reactivated their assembly operations in Iran (e.g. Mercedes-Benz & Lexus)

Preliminary Agreement provisional agreement on framework for permanent suspension of sanctions

JCPOA3) phased sanction relief upon verification that Iran has implemented key nuclear commitments January 16th the IAEA declares that Tehran has fulfilled its obligations and the lifting of sanctions is announced

> The history of sanctions on Iran dates back to 1979

> Several rounds of further reinforcement latest in effect since 2013

> In July 2015, the 6 nations (P5 + 1) signed the Joint Comprehensive Plan of Action

> The plan includes a gradual process of sanction lifting based on IAEA-verified implemen-tation of agreed nuclear-related measures

10 Roland Berger_Iran_A historical opportunity_Final.pptx

Almost all economic and financial sanctions imposed by the EU and USA have been terminated Certain restrictions still in place

Impact of lifting of nuclear-related sanctions Selection

Source: Congressional Research Service; Iran Watch; Roland Berger

Iranian companies are again allowed to export Iranian oil, gas and petrochemical products as well as gold, precious metals and diamonds, and the delivery of Iranian banknotes and coinage is permitted

Most banking activities, including the opening of new branches of Iranian banks in the EU and the opening by EU entities of new offices, subsidiaries, joint ventures or bank accounts in Iran are allowed again Also transfers of funds between EU entities, including financial and credit institutions,

Recommended

View more >