Iran auto industry Archives - Iran News Daily

Japan Can Develop Iran Auto Industry

mahla — Sat, 03 Sep 2022 18:53:03 +0000

TEHRAN (Iran News) –The chairman of the Iran-Japan Joint Trade Committee believes Japan can be a good choice for Iran to improve its auto industry provided that it shows interest in cooperation with Japan and JCPOA talks end successfully and sanctions are removed.

Speaking to ILNA, Bahram Shakouri talked about the latest developments in trade between Iran and Japan and said that Japan is one of the most advanced countries in industry in the world, as everybody knows it well that automakers active in Japan are international and they sell 75% of their products in the international markets.

Touching upon the remarks of Japan Ambassadors regarding cooperation between the two countries in the field of auto making, Shakouri said that Mr. Ambassador is completely right, adding that since major shares of Japanese products are sold in the U.S. market and they have American partners and actually they have joint investment with the U.S., there is no possibility for the presence of Japanese carmakers in Iran’s market due to the sanctions. He added that of course one of the good choices for cooperation with Iran can be Japan along with imports of cars from China because Japan is one of those countries which can develop Iran’s auto industry provided that Iranians show interests and the JCPOA talks end successfully and sanctions are removed.

He also criticized the approval for setting price ceiling of 20,000 euros for import of any car , adding that Japanese car can also enter Iran’s market with this price ceiling but it seems the figure should be changed because this price ceiling actually will push the purchasers towards low quality Chinese cars.

Shakouri then talked about the history of Iran-Japan ties and said that a couple of years ago both countries celebrated their 90th anniversary of ties and it bespeaks of century-long and close relation between the two states. He reiterated that Japan government and people are interested in cooperation with Iran and on the whole Iran enjoys distinguished strategic position in the region and he believes Iran can be a hub in the region for production and export of any products.

He then pointed to some hurdles in way of imports from Japan and said that long distance is the most important hurdle but currently sanctions is the main problem for imports from Japan and it has helped Japan to boost its ties with other countries in the region.

Shakouri said that Iran can have huge amount of exports to Japan and in return, it can import the latest technology and knowhow from Japan and both countries can cooperate on the joint venture projects.

He went on to say that Iran can cooperate with Japan in the fields of technology, rail transportation and infrastructures, auto making, tourism, gas fields and other industries, and Japan also can enjoy importing Iranian carpets, caviar, saffron, pistachio and dried fruits. He reiterated that in case sanctions are removed, Iran and Japan can improve the level of trade ties.

Shakouri went on to say that currently the official trade volume of Iran and Japan in the current year has been less than $30m and it has been mainly imports of Japan because major exports of Iran to Japan have been oil and oil products which have been zeroed due to the sanctions.

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India Keen to Invest in Iran’s Auto Industry

mahla — Wed, 25 May 2022 04:30:55 +0000

TEHRAN (Iran News) – Chairman of International Committee for MENA Region of India’s PHD Chamber of Commerce and Industry (PHDCCI) Mr. Vijay Mehta says India is keen to invest in Iran’s auto industry and expressed hope for removal of current problems in way of economic cooperation between the two countries.

On Monday a forum was held by Tehran Chamber of Commerce on exploring ways for improving the trade and economic cooperation between the two countries where over 150 Iranian and Indian business activists were present.

Addressing the forum, Mehta deplored that Indian people have little information on the existing economic and industrial capacities in Iran and reiterated that exchange of trade delegations will help both sides to help their people to know the grounds for cooperation. He added that India will become a $5,000b economy in the world in upcoming years, adding that economic policies of the Indian Government has made the economic progress of the country surpass China. He noted that due to these policies, now many international companies open their offices and plants in India instead of China, Indonesia and Bangladesh because India enjoys having advanced legal and banking systems.

Mehta expressed hope the current economic problems between Iran and India would be resolved and said Indian companies and industries are ready to offer their services to Iranian companies in developing software industries, medical and health as well as engineering.

He went on to say that many European auto-making companies are active in India and productions in these plants in India are exported to other countries, adding that one of the grounds for cooperation between Iran and India is the joint investment in the auto industry.

Then Economic Attache of Indian Embassy in Tehran Mr. Gautam Wahi, for his part, said Iran and India’s economy is complementary, adding that Iranian companies can take advantage of capacities and capabilities of Indian technology companies for entering the international markets.

He said that regarding the war between Russia and Ukraine, India is not under influence of any world power, reiterating that India needs Iran’s oil and energy.

He noted that development of economic relations between Iran and India requires broadening political ties between the governments of the two countries, adding that cooperation between both countries in developing some infrastructures in Iran like in Chabahar Port and construction of railway between Iran and India will lead to improvement of economic ties between the two countries.

At the beginning of this event, Secretary General of Tehran Chamber of Commerce Mr. Bahman Eshqi said that this event can open a new chapter in the economic relations of Iran and India and currently there are some concerns in both sides for broadening cooperation and expressed hope both sides have better ties through talks. He announced readiness of this chamber for talks with India government and private sector activists and for deepening of economic relations between Iran and India

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Iran Car Industry to Absorb Shock of US sanctions

reporter 1222 — Thu, 06 Aug 2020 05:02:01 +0000

TEHRAN (Iran News) – When the US unleashed its most aggressive sanctions ever on Iran in August 2018, it reserved the first hammer blow for the car industry to hurt as many Iranians as possible.

The auto industry is a key driving force in Iran, the operation and prosperity of which keeps more than 60 other industries moving, according to Press TV.

The industry is only second to Iran’s energy sector, accounting for some 10 percent of the gross domestic product and four percent of the employment in the country.

Iran began manufacturing its own car in 1967, churning out the box-shaped Paykan, which was a replica of the British-made Hillman Hunter. It also imported mainly from Western Europe and the US, which accounted for approximately 40 percent of Iran’s market.

However, the baby boom during the first decade after the victory of the 1979 Islamic Revolution generated a young population which was almost 75 percent urbanized by 2017 and hungry for cars.

The post-war – Iraqi-imposed war (1980-88) – governments decided to give a new lease of life to the auto industry, but opted to stop manufacturing and start assembling instead because they thought Iran could not compete with strong international carmakers.

International players, meanwhile, showed interest in the Iranian market, and policies were put into place that allowed car imports without technology transfer.

France, a partner of Iran in the automotive industry for a long time, entered into new joint ventures with main producers Iran Khodro Company (IKCO) and Saipa.

To meet the domestic demand, automotive production rose by more than 18 percent in 2017. Iran produced 1.4 million cars and commercial vehicles, ranking sixteenth in the world.

However, foreign companies that made cars in Iran – including France’s Peugeot and Renault – decided to leave after US President Donald Trump announced new sanctions on the Islamic Republic in 2018.

Renewed sanctions led to delays in-car deliveries and a shortage of parts and by June 2018, a month after the sanctions were renewed, Iran’s car production dropped by 29 percent compared to what it was in the same 31-day period a year earlier.

Iran has gone through waves of sanctions since the victory of the Islamic Revolution that has spilled over into the daily life of people in the country of about 85 million.

On the flip side, the pressures have been a boon to domestic manufacturers who have thrived under the new situation because Iran cannot afford to drop its automotive industry altogether. The sector is so massive with its solid infrastructure in production, which is of both economic and political importance to the government.

More than 100,000 people are employed by the two largest local manufacturers IKCO and Saipa, while another 700,000 Iranians work in industries related to car manufacturing.

There are around 13 public and private auto manufacturers in Iran, with IKCO and Saipa accounting for about 94 percent of the domestic production.

After the US reimposed its sanctions, Iran’s union leaders warned that up to 450,000 jobs in the auto parts industry were at risk, prompting the Defense Ministry to wade into the quandary.

The ministry is now helping the Iranian carmakers manufacture hi-tech auto parts, which the country used to import.

Cars produced in Iran under license from foreign manufacturers rely on critical imports of parts ranging from airbags, pistons and cylinder heads to computer chips, including engine control units and sensors.

IKCO Managing Director Farshad Moqimi on Tuesday said Iran is now producing more than 50 parts, which were imported.

“With the measures, we have taken in the field of domestic production and self-sufficiency… we have been able to reduce more than $50 million in production costs and plan for another $300 million in reduced costs,” he said.

Moqimi said IKCO has produced more than 172,000 cars since the beginning of the current Iranian calendar year (March 20), up by 36 percent against the figure for the same period last year.

“A 30 percent increase in car delivery to customers is also one of IKCO’s recent achievements,” he noted, adding 51,000 cars out of a total of more than 200,000 that had not been delivered on time have been handed over to their owners.

“When the US has targeted the automotive industry and started its sanctions from this sector, we must work together to maintain the flag of production in this industry flying high,” Moqimi said.

He noted that although Iran is now self-sufficient in the production of some parts, it has a problem in supplying raw materials and has to meet its needs through imports, adding increasing domestic production of the raw materials should also be placed on the agenda.

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Auto parts manufacturers need $2b: Iran Official

reporter 1222 — Thu, 07 May 2020 04:31:22 +0000

TEHRAN (Iran News) – Auto parts manufacturers of Iran need nearly $2 billion to manufacture the auto parts required for producing 1.2 million vehicles in the country during the current Iranian year (started March 20), said the secretary of Iranian Auto Parts Makers Association.

Talking to IRNA on Wednesday, Maziar Beyglou said that the biggest problem that domestic auto parts manufacturers are currently facing is securing foreign currency.

Since the start of the year, no foreign currency has been provided for the auto parts manufacturers and they have been seriously facing problems for the shipments of their required raw materials, he complained.

Through great endeavors on the path of self-reliance in the auto parts manufacturing and omitting CKD (completely knocked-down) process in the domestic auto industry, at present, this industry has the lowest reliance on foreign currency in its history, he added.

“The last requirement of the auto parts manufacturers is expected to be supplied by Central Bank of Iran (CBI), and if the CBI cannot provide it, they should give us the permit so that we can secure foreign currency directly from exporters (who should offer their earned foreign currency in a system named NIMA to provide the required foreign currency for the importers of necessary commodities),” he further noted.

In January, Beyglou announced that Iran had achieved 80 percent self-sufficiency in the manufacturing of auto parts.

He expressed hope that self-reliance in this sector will reach 90 percent through domestic production of required raw materials.

Domestic parts manufacturers are able to play a key role in creating a boom in the country’s manufacturing and employment sectors, in addition to playing their leading role as the auto industry’s intermediaries, Beyglou said.

Mentioning the Industry Ministry’s strategies for promoting domestic production, he said: “Following the current policies, we will see the production of a number of new vehicles from domestic automakers in the coming years.”

In May 2019, Industry, Mining, and Trade Minister Reza Rahmani issued a directive on “strengthening domestic manufacturing of imported auto parts.”

Addressing two of his deputies, Farshad Moqimi, deputy for industrial affairs, and Mohammad-Baqer Ali, the chairman of the board of Iran’s Industrial Development and Renovation Organization (IDRO), the minister emphasized using the highest potential of human resources for strengthening the domestic manufacturing of auto parts which are currently imported.

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Workers of auto part manufacturing re-employed

reporter 1222 — Sat, 11 Jan 2020 12:49:37 +0000

TEHRAN (Iran News) – The secretary of Iranian Auto Parts Makers Association said 40,000 workers who were dismissed by the country’s auto parts manufacturing have been re-employed following a boom in the auto industry, ISNA reported on Saturday.

Maziar Beyglou noted that if the current production trend continues, “we will expect an increase in the automotive industry’s production next year.”

Mentioning the industry ministry’s strategies for promoting domestic production, Beyglou said: “Following the current policies, we will see the production of a number of new vehicles from domestic automakers in the coming years.”

Domestic parts suppliers are able to play a key role in creating a boom in the country’s manufacturing and employment industries, in addition to playing their leading role as the auto industry’s intermediates, he stressed.

Beyglou pointed to relying on foreign sources, as the main reason for the decline in the country’s car production after the re-imposition of the U.S. sanctions, saying “With the new policies adopted, if we provide funding for the country’s auto parts industry, we will definitely witness the production of high-quality and up-to-date vehicles by domestic manufacturers.”

In mid-May 2019, the Iranian Industry, Mining and Trade Minister Reza Rahmani issued a directive on “strengthening domestic manufacturing of imported auto parts”.

Addressing two of his deputies, Farshad Moqimi, deputy for industrial affairs, and Mohammad-Baqer Ali, the board chairman of Iran’s Industrial Development and Renovation Organization (IDRO), the minister put emphasis on using the highest potential of human resources for strengthening domestic manufacturing of auto parts which are currently imported to the country.

Also in December 2019, the Specialized Manufactures of Auto Parts Association announced that Iranian carmakers have prepared some incentive packages to encourage investment making by the auto parts manufacturers.

Given that 1.25 million vehicles have been anticipated to be manufactured in the country during the current Iranian calendar year (ends on March 19, 2020), the part manufacturers need 150 trillion rials of working capital (about $3.571 billion) for the purchase of raw materials and other required items.

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Over €840m allocated to support domestic auto parts manufacturers

reporter 1222 — Mon, 19 Aug 2019 07:30:14 +0000

Seyed Reza Mofidi noted that according to the ministry’s plans, domestic manufacturers are set to produce 1.3 million automobiles by the end of the current Iranian calendar year (ends on March 19, 2020) of which 310,000 was manufactured up to August 10.

According to the official, the country’s total car output reached 950,000 last year.

Mofidi also mentioned establishment of a roundtable for domestic auto parts manufacturers at the ministry’s Automotive and Transportation Industries Office, saying that “So far nearly 7.4 trillion rials (about $177 million) worth of deals have been signed with domestic manufacturers in this office, which have saved the country over €85 million.”

According to the industry ministry, given the number of vehicles that are anticipated to be manufactured in the country during the current calendar year, the part manufacturers will need 150 trillion rials of working capital (about $3.571 billion) for the purchase of raw materials and other required items.

In mid-May, Iranian Industry, Mining and Trade Minister Reza Rahmani issued a directive on “strengthening domestic manufacturing of imported auto parts”.

The ministry has also unveiled a 10-section plan on early February for improving the status of car makers, in which the two major car makers of the country have been ordered to support auto part manufacturers.

Following the orders of Industry Ministry, domestic car makers have started a research movement in recent months titled “Domestic Manufacturing of Imported Parts”.

The movement is aimed at creating the condition and opportunity for cooperation among domestic manufacturers, knowledge-based companies and startups.

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