How Iran Khodro Tried, and Failed, To Get Into China

Back in 2006 Iranian automaker Iran Khodro (IKCO) tried, and failed, to get into the Chinese car market. They went into China in two ways: with a localized version of the Samand Soren sedan, and with the Peugeot 206 SD sedan.

In early 2005 IKCO agreed to a joint venture with a Chinese company called Guihang Youngman Lotus Automobile, based in China’s Guizhou Province. At the time, Youngman was a bit of a busy bee.

They had an official agreement with Lotus Cars to distribute British-built Lotus cars in China. Under this agreement, they got the right to the Chinese name of Lotus (Lianhua, 莲花), and they had the right to produce China-made economy cars under the Lotus brand. At the time, Lotus cars was owned by Malaysia’s Proton Holdings.

At the same time, Youngman also became owner of the Yunqu-brand, famous for their earlier joint venture with Subaru.

When IKCO came calling, Youngman was looking for a well-funded partner to kick-start the Lotus project. But apparently, Youngman didn’t see IKCO as the partner they needed.

But no Chinese company ever turns away an opportunity to earn some cash. So instead they convinced IKCO to set up a joint venture with the Yunqu-brand, which hadn’t seen any new models for ages. Youngman held 70% of the shares, while IKCO got only 30%. Not a good deal for the Iranians, as most of the foreign-Sino joint ventures had a 50-50% ownership.

Companies agreed that their first model would be a China-made variant of the IKCO Samand, a sedan originally based on the platform of the Peugeot 405.

Interestingly, companies choose to go for the updated version of the Samand, the Samand Soren, which at that moment was still under development in Iran, and wouldn’t be launched in Iran until 2007.

The Chinese variant appeared in July 2007. It was largely the same as the Samand Soren, but with a black grille with an oval Yunqu badge in the middle. The official Chinese designation was GHK7180. The initial plan envisioned a production of 30.000 cars a year, to be build in a new factory in Shandong Province.

The GHK7180 was powered by a 1.8 liter four-cylinder petrol engine, manufactured in Iran by IKCO, and imported into China. Output was 100hp. This engine was based on the PSA XU7. Size: 4530×1720×1460, wheelbase 2670, and curb weight 1220 kilo. Top speed was 170 kilometers per hour.

Sadly, in the end the Youngman-IKCO GHK7180 didn’t happen. As mentioned above, Youngman was looking for a partner to get their Lotus program off the ground.

In 2008 Youngman found it’s partner; Malayia’s Proton,the company that owned Lotus anyway, and they too were looking for an entry into the Chinese market.

Companies agreed to rebadge various Proton cars into the Lianhua-brand. Somewhat confusingly, Youngman did not have the rights to the English name of Lotus. To fix that, Proton and Youngman founded a new brand called Europestar, badged as Europestar  Engineered by Lotus.

While all this was happening the Youngman-IKCO deal appeared to die a slow death, and in 2008 the Iranians pulled out.

More on the rather complicated Youngman-Lotus situation, which at one point almost included Dutch supercar maker Spyker, in a later article. Back now to IKCO. Because in 2006 they had yet another plan:

On the 2006 Beijing Auto Show, IKCO showed the Iranian-made Peugeot 206 SD, an Iranian-market variant of the Peugeot 206 sedan. The 206 SD was not a part of the Youngman-project. In Beijing, IKCO was looking for yet another partner to produce the 206 SD in China.

Problem was that Peugeot was already making a localized version of the 206 sedan in China, in their joint venture with Dongfeng Motors. So the French were very unhappy to see their Iranian ‘friends’ turning up in China. They wasted no time and simply forbade IKCO to continue with their China-206 project. It was their car anyway…

And that was the end of Iran Khodro’s Chinese dream. But not completely. Just one year later IKCO agreed to a deal with Chery to make Chery-branded cars in Iran. How that ended up? Read it here, later on.