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Saipa
Pioneer in
R&D
The Saipa Auto Manufacturing Group, with
a production of 97,500 units of light and heavy vehicles, possesses around 36%
of the Iranian auto market. The company’s share in sedan, pickup truck and
front-wheel drive vehicles stands at 33.24%, 65.81% and 71.25% respectively.
For recreational van, heavy-duty truck and minibuses the shares are 94.15%,
40.23% and 21.43% respectively. Saipa has recently added around 80 companies
to its manufacturing make-up. The company is hoping to grab around 50% of the
domestic auto market by 2004. In an interview, Managing Director of Saipa,
Ahmad Qalebanni, highlighted how the desired 50% market share will be realized
in the coming years with the help of investments as well as plans and programs
for qualitative and quantitative improvements and product diversity.
How much does Saipa spend on Research and Development
(R&D)?
There isn’t a
fixed figure or percentage I could state, but Saipa is one of the first
companies to establish an auto research center. This center has unique
facilities and research projects and Saipa allocates a specified portion of
the budget for the expansion and enhancement of this center. This center also
codifies technological discoveries in parts manufacturing as well as vehicle
design for caravans and Prides and has just recently started the design of a
car, the S81, which uses the Peugeot 206 or Pride platform and is hoped to be
marketed by 2005.
What would you say to mergers with other domestic auto
manufacturers or major foreign auto manufacturers?
Auto mergers,
especially with foreign companies and especially in the current condition, are
very beneficial. But the main obstacles are the laws of the land. Even if
generous investment and handsome funds are available for mergers our rules and
regulations will not allow them. Joining the global market is a sure way of
boosting production quality and efficiency, as it allows transfer and purchase
of new technologies. Currently we are not allowed to spend a rial (a lot less
than a cent) on technology, but with the auto industries liberalization these
restrictions will be lifted. When you get connected to a foreign company, your
production becomes much more economical. At the moment we achieve our slow
technological advancements through trial and error, which is also a main
reason for the sometimes shoddy quality of domestic autos. If we join a
foreign company we will be able to benefit from their technology to boost our
domestic production qualitatively and quantitatively, to the mutual benefit of
both sides. The production scale will reach the millions mark and new makes
will be offered every year.
Why haven’t there been any domestic mergers, for example
between Saipa and Iran Khodro?
At the moment
domestic mergers are not on the table. However there is an agreement for
cooperation and effort-pooling for the manufacture of two autos on a single
platform. Our two companies are currently negotiating the co-production of
some parts and systems in hopes of boosting production efficiency.
What is your suggestion for the advancement of the auto
industry?
It is certain that the rules and
regulations relating to the country’s economy are in need of reform. This
reform should include tax laws, trade laws, employment laws, investment laws
and banking laws. We are in need of a long-term plan in all industries,
especially the auto industry as this the only way we can attract investments.
If a long-term objective-orientated plan is implemented, Iran’s auto industry
will be able to compete with foreign companies in four years time. However, if
this planning is not done, the auto industry will not have a bright future to
look forward to.
Anyway, Saipa will make its utmost
effort in 2003 to ensure that auto prices will not climb higher than their
2002 levels. To achieve this aim, we must increase our production and the
number of autos we market and hopefully with the production of 1000 Prides a
day Saipa’s auto prices will be more or less stable in 2003. |
