Whenever we think of cars, we think of Toyota, Volkswagen, Ford, Tesla, Mercedes-Benz, BMW, and Maruti Suzuki, and we think of automotive powerhouses such as Japan, Germany, US, South Korea, and India. Of late, we have also started talking about China and BYD.
But few would think of Iran, and fewer still would have heard of names like Iran Khodro, SAIPA, and Pars Khodro. According to a report by the Tehran Times, these three carmakers together produced 643,000 cars from March-December 2025 – more than what Hyundai sells in India in a year.
Iran Khodro (IKCO)
Founded in 1962, Iran Khodro – ‘khodro’ means ‘automobile’ in Persian – started by manufacturing Renault and Peugeot cars in Iran under licence. The most famous car was the Paykan sedan (1967-2005), based on the British Rootes Group’s Hillman Hunter. It was replaced by the Samand – a family car built on the Peugeot 405 platform. It was to Iran what the erstwhile Maruti Esteem was to India. Its new cars like the 2024 IKCO Reera (related to Peugeot 2008) – available both as ICE and EV – look as modern as any in the world.
SAIPA
It started in 1965 as SAIPAC, short for Société Anonyme Iranienne de Production des Automobiles Citroën (or Iranian Joint Stock Company for the Production of Citroën Automobiles). When Citroën left the market in 1975 – following Peugeot’s takeover of Citroën, and both forming the PSA Group – SAIPAC became SAIPA. Its most famous models are the Tiba (now discontinued), Saina, and Quik (hatchback version of the Saina) – all are evolved versions of the Kia Pride (which SAIPA built for years). Pars Khodro is part of SAIPA, and other carmakers are Bahman, Kerman, and Modiran, most of which are assembling Chinese cars in Iran.
The French connection
A reason why most Iranian cars look like old Peugeot and Renault models is that the French automakers were the early entrants in the market, and when they left gradually – starting with the Iranian Revolution of 1979, Iran-Iraq War (1980-88), and international sanctions – Iranian carmakers retained the rights to their platforms, and perfected these over the years.
Does Iran export cars?
Yes, data from the Observatory of Economic Complexity (OEC) reveals that Iran exports a few thousand cars to countries like Azerbaijan, Iraq, Venezuela, and parts of Central Asia, but detailed data isn’t available because the International Organisation of Motor Vehicle Manufacturers (OICA) doesn’t publish granular, real-time export data.
What’s unique?
Automotive industry has huge global linkages, and Iran is a global pariah, and yet it has survived on local talent and supplies, and by reverse engineering Western platforms it had access to. The journey from the Paykan to the Samand to the Reera shows that a country can put itself on wheels without it being part of the global supply chain.
Three Iranian cars you should know:
Paykan (1967-2005): The first popular car, based on Britain’s Hillman Hunter.
Samand (2001-2022): It was to Iran what the erstwhile Maruti 800/Zen/Esteem were to India.
Reera (2024 onwards): A modern car, available both as ICE and EV.
The stats box
According to Mordor Intelligence, Iran has a resilient domestic manufacturing capacity of above 1.1 million cars annually – making it larger than many European automotive hubs – despite sanctions.
Did you know?
One of Iran’s largest-selling cars has an American connection. In the 1980s, Ford asked Japan’s Mazda to design a low-cost car, and the Mazda 121 was born. But to keep costs down, the 121 was manufactured by Kia in South Korea. The three carmakers were in a strategic alliance in which Mazda designed the car, Ford marketed it, and Kia manufactured it. The 121 was then sold in the US as the Ford Festiva, and in South Korea as the Kia Pride. In the 1990s, SAIPA began producing the Pride in Iran under licence. When sanctions hit, Kia left and SAIPA kept building the Pride, evolving it into Saina and Quik.
This was the story of a car planned in America, designed in Japan, made in South Korea, and which found its final home in Iran.
