Chapter 141: Middle East Strategy

SAIC took the lead in entering the world's top 500 and won a round of applause in China, but Han Hao had no time to digest the news, he will fly to the Middle East to realize a new round of Zhonghua Group's strategy of going global.

Under the premise that the Zhonghua Group is not strong enough to confront the multinational giants head-on, detouring to the areas they have not touched is another strategy of encircling the cities from the countryside.

For example, entering the Russian and Indian markets is that under the premise that the multinational giants did not react, the Zhonghua Group first seized the opportunity, and then slowly tried to do it. In the million-dollar car market, multinational giants are reluctant to enter for various reasons, which happens to be cheaper than Zhonghua Group, which is eager to expand overseas.

While US GIs were stationed in Iraq, the guns and artillery in this country still did not stop, and the pro-US forces that came to power after the fall of Saddam Hussein did not immediately bring good prospects to the Iraqi people.

Iran, another Middle Eastern power adjacent to Iraq, has the sixth largest oil resources in the world, but it has not been able to become rich like Saudi Arabia, the United Arab Emirates and other countries because of the international blockade caused by the hostility with the United States.

If you offend the boss, then maintaining a good relationship with the second and third children is the wisest choice. As a result, Iran has maintained good relations with Russia and China, despite its poor relations with the United States.

In particular, China's economy has developed rapidly since joining the TO, and the demand for global resources has further increased, and oil is a scarce energy source for China's imports. According to statistics, China relies on imports for more than 40% of its oil consumption, and nearly half of the giant ships that transport oil on the ocean every day are destined for Chinese ports.

Due to the sanctions imposed by Western countries led by the United States, Iran's economic development rate is average, but this country has a population of more than 70 million and has a large demand for cars. Iran's domestic car market is now very similar to Russia's, with two state-owned auto companies backed by the government producing cars of the 80s, which are not very high-tech in comparison.

Iran accounts for nearly 10% of China's oil imports every year, and the economic and trade relations between the two countries are good. China needs Iranian oil, and Iran imports from China all kinds of industrial products that it does not get from Western countries.

As a rising economic power, China has come to Iran's aid in times of crisis, and they can source many goods from China, the world's factory.

As a result, China's influence also radiates to Iran, with a population of 70 million and annual car sales of nearly 800,000 units, which is one of the top car markets in the Middle East.

And this car market is almost blank, there are no foreign car brands to settle in, because they are all forced to leave Iran under the pressure of US sanctions, which provides a very good opportunity for Zhonghua Group.

The best-selling car in Iran is the Kia brand Pratt car, which was originally introduced to China by Yueda Kia. The car was bought out by Iran's state-owned car company Sepa and continued to be produced in the country, and many sibling models were derived, but the outdated appearance and engine have shown that it is no longer suitable for the development of the times.

Iran imposes tariffs of 150-200% on imported cars from abroad, and prohibits American-related cars from entering the country, so the current models on the road are all old models, and you will not see any models that are in line with international standards.

However, with the development of the world economy, Iran also intends to gradually liberalize the import tariffs on complete vehicles, which is expected to be reduced to 90%-120%, and parts will be reduced to 30%, which is a great boon for Chinese auto companies.

At that time, if the CKD or SKD model is adopted to organize production in Iran, the cars from China will be very competitive.

Han Hao's visit to Iran this time was introduced by the Ministry of Commerce. In addition to the oil industry, Iran's automobile industry is another pillar of its economy.

Seeing that the Zhonghua Group has invested in the construction of factories in Russia and adopted China's 50:50 joint venture model to produce cars, the Iranian side is also very interested.

Unable to get advanced automotive technology from other countries, he can now turn to China for help, so Han Hao has become a guest of honor in the Iranian government.

They hope that Chinese auto companies can build joint ventures with local automakers, so as to promote the development of Iran's backward auto industry and achieve the goal of becoming an economic power.

In Tehran, Han Hao saw Pratt cars running all over the streets, which reminded him of the stories told by the people at Jier Machine Tool Factory.

In 2001, the Chinese and South Koreans jointly bid for the equipment of Iranian automobile factories, and in the end, South Korean companies that are not as strong as the Chinese won, because the Iranians believe that South Korean cars are all over the local streets, while there are no Chinese cars.

"When your Chinese brand cars can run in our capital, there is hope that you Chinese will win the bid!"

When this sentence was relayed from the mouth of Jier Machine Tool Factory at that time, Han Hao remembered it very clearly.

Now that the Chinese have finally arrived, it may not be long before the streets of Tehran are full of Chinese cars.

He had already made up his mind that if he built a factory in Iran, then the stamping equipment would have to be manufactured by the Jier Machine Tool Factory.

Who said that Chinese products are not good, the large-scale stamping equipment produced by Jier Machine Tool Factory is very well used in Dinghai base.

At that time, the Iranian manager who rejected the products of Jier Machine Tool Factory had to visit the production line of the new factory to feel the strength of Chinese products on the spot.

As an outstanding entrepreneur in China, the Iranian official gave Han Hao's visit a high-standard reception.

"We welcome Chinese companies to invest in Iran, for reasons that are well known, we are not able to get help from other countries, and we will guarantee their legitimate interests to our friends from China.

The Chinese auto market is fiercely competitive, and the successful experience from the Chinese market can bring us a reference for Iran. For example, the 50:50 joint venture strategy not only ensures the interests of local partners, but also safeguards the rights and interests of foreign investors, and a win-win situation for both parties is an excellent experience model created by your Chinese. ”

As the mayor of Tehran, Ahmadinejad is known as a civilian mayor and has a strong reputation in Iranian politics and is considered the favorite to be chosen next year's next Iranian president.

As for the Zhonghua Group, Ahmadinejad learned through information that it is developing rapidly in China and has also set up joint ventures in Russia and India, making it an ideal target for the Iranian automobile industry to introduce joint venture partners.

"Iran has a good geographical location and a domestic market with great potential for growth. When I was in Tehran, I saw a lot of Chinese goods, but unfortunately I couldn't see Chinese cars.

We at Chung Hwa Group focus on long-term interests and guide our investment path with a locally-rooted strategy.

Judging from the data, Iran's car ownership is close to 8 million, of which more than 80% have been out of service, which has a very large demand for new cars.

Frankly, we are very interested in investing in Iran, but we need to know more about some of your country's automotive policies. ”

In Han Hao's view, the Iranian market does have great potential for development, as long as the international situation is stable and the economy develops normally, it will be a rare auto gold mine.

What's even more attractive is that the models here are too old, as long as the new models of the China Group come in, no other models on the market will be rivals.

But if you want to enter the Iranian market, you must have a joint venture with a local auto state-owned enterprise, and the two state-owned car factories of Khodro and Sepa will choose one of the two to become the partners of the Chunghwa Group.

Now that Iran's auto industry policy may be loosened, he must know how much preferential investment conditions the other party has given before he can invest locally with confidence.

"Blind protection will not help the development of the automobile industry, so our country should quickly adjust the automobile import policy, and at the same time give more preferential tax policies to foreign-invested automobile companies that invest and export. ”

Ahmadinejad hopes to finalize the projects that China Group will land during his tenure, thus paving the way for his own presidency.

Setting up a factory in Iran, in addition to fancy the local car market of nearly one million units, Han Hao also intends to use it as a bridgehead for Zhonghua Group to enter the Middle East and North Africa.

Many countries do not have their own car industries, and the demand for cars depends on imports, so cars produced at Iranian factories can be distributed to nearby countries.

After on-site inspection, Han Hao finally selected Sepa Automobile as the joint venture partner of Zhonghua Group in Iran.

Zhonghua Group announced that it will build a joint venture factory in Iran, with a production line of 100,000 units put into operation in the first phase and a production scale of 300,000 units in the future, with a total investment of more than 10 billion yuan.

In order to show its sincerity, the Iranian government announced that it will purchase 2 billion yuan worth of cars from the Chunghwa Group, including sedans, SUVs and MPVs, with a total of 13,450 vehicles. They will be used for government and related vehicles, as well as for taxis on the market.

The government-procured vehicles will be assembled at the joint venture plant in Iran under the CKD model, which is a good start to the joint venture between the two companies.