Fiat Auto S.p.A. and Iran’s PIDF (Pars Industrial Development Foundation) have announced a co-operation agreement to manufacture and distribute Fiat cars in Iran.

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Herbert Demel, president and CEO of Fiat Auto S.p.A., and Manouchehr Gharavi, chairman of PIDF Co., signed a contract for the production of the Fiat Palio hatchback, the Siena sedan Siena, the Palio Weekend Adventure wagon and the Strada pick-up.


The deal also includes an MPV (minivan) version and the manufacture of bi-fuel vehicles, including Fiat’s Multipla MPV and Doblò van, powered by compressed natural gas (CNG) engines at PIDF’s facility in Iran.


Production and distribution are expected to commence in the second half of 2005. Annual output is expected to reach more than 100,000 units in phase one, and to exceed 250,000 units when full capacity is reached. Overall investment by PIDF will total about €200 million.


“This initiative is important because it forms part of our strategy for strengthening Fiat Auto’s presence in markets with a high growth potential in the automobile sector,” Demel said at the agreement signing ceremony in Tehran.

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“We want to bank upon and further exploit the prestige of our “world car” project, which has won many awards in several countries and is praised by customers in more than 40 markets where the Palio family is already present.


“The agreement also encompasses the production of bi-fuel vehicles powered by CNG engines, a field in which Fiat has been in the forefront technology-wise and plays a major role internationally.”


Moreover, we are happy to team up with PIDF… due to their recognised and long standing experience in the automotive sector,” Demel said.


Gharavi said: “Thanks to our co-operation agreement, Fiat is back in our country after 50 years. Fiat is a world leader in the area of bi-fuel vehicles and its technology in CNG engines, which have great potential especially in the Iranian market, is second to none. Our plans call for establishing an important and consistent market share in Iran. Furthermore, our new venture is destined to play an important role in the expansion of Iran’s automotive supply industry, further enhancing its expertise as it joins Fiat Auto’s world-wide suppliers network.”








Fiat Palio Weekend wagon







Fiat Strada pickup







Fiat Siena sedan