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This research aimed to cover and point out the strengths and weaknesses of Iranian car industry and intended to define an effective and implemental strategy for future car industry in Iran. First we have looked at the logical and required steps in the world auto industry and auto market from both the production point of view and consumption. And we have talked about the changes that happen in the world consumption which leads manufacturers to change their production and marketing policy. Then we have referred to remarkable decline in development of a new product and ability to offer new types of car in shorter period and other different strategy which auto makers follow to maintain their economy of scale and profitability. Following these general concepts we have looked briefly on three examples of emerging countries - Turkey, China and India- which has reformed their auto industry and maintain their growing. The more similarity in the circumstances and the place of mentioned developing countries to Iran, the easier will be comparison. According to this background we have looked at the case of Iran auto industry and its current situation. Although there are much more in this issue on auto industry and the way in which it is affected in Iranian economy some main points come up from the above information and discussion.

The strict production policy which has followed by Iranian government might be the main cause of poor development in this sector. However this strategy in short term helps the manufacturers to build up them, in long term, lack of connection to the world industry network keep the technology undeveloped. No encouragement to improve the quality and reliability is the result of no real competition in the market which the production strategy provides for the market. In such a situation all kind of investment and financial aid by government are ineffective. This is an important issue which had happened in all mentioned examples and they all finally have decided to remove it, whether in short period of time (India) or in a long time aim to build up a national industry.(China & Turkey).

The auto makers' performance on the R&D part has been so impractical and inefficient which lead them to the shortage of high skilled people in research and design area, and caused an undersized rate of improvement in the level of technology. To catch up in the world auto market is not possible without a strong infrastructure and high technology which can be best done through participating in the global economy. It seams technological development is not possible without connection to the world auto network. Iranian firms need to import technology, base information, training programs and the experience of auto engineering from the international auto makers. Iran situation has enough potential opportunity for multinationals such as its market, cheap raw material and cheap workforce, so presence of them and share the market with them aim to improve the knowledge and technology does not mean dependency on the foreign companies and it will be possible to build up a national industry as well.

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