Output of Iran's giant carmaker increases by 173 percent

Baku, Azerbaijan, May 2

By Umid Niayesh - Trend:

Iran's struggling automotive industry has started to revive thanks to suspended western sanctions on the country's carmakers.

Iranian giant car manufacturer Iran Khodro(IKCO) has produced some 18,900 sedans during the first month of current Iranian calendar year, the company's vice-president Mohsen Naghedi said, Iran's ISNA news agency reported on May 2.

The figure shows a 173 percent increase compared to the number of produced cars in the same period of the preceding year which was about 6,900 sedans. However it is far away from the company's production goal figures. The IKCO's goal is to reach an average production rate of 1,800 cars per day, according to the company's managing director Hashem Yekke Zareh.

The largest Iranian carmaker, IKCO experienced about $201 million (based on official rate of 24,900 rials per each USD) in loss during the first half of the last Iranian calendar year.

Increasing prices on raw materials and foreign currencies as well as international sanctions are car manufacturers' main problems in Iran. About 69 automobile manufacturer units have been closed and 115,000 people lost their jobs in the automobile sector of Iran during the past two years due to pressure of the sanctions.

Western countries suspended certain sanctions against Iran as the Geneva nuclear deal came into force on Jan. 20. Iran was permitted to import materials for its auto manufacturing sector as a result of the nuclear deal implementation, which has led to sharp increase in the country's auto exports in recent months.

Iran exported 10,744 sedans during the last Iranian calendar year (ended on March 20, 2013), with some 4,231 of that amount only exported in the latest Iranian month.

The country exported $27 million of sedan cars only in the last calendar month which is even more than half of the total yearly export value.

Iran produced 655,551cars in the first eleven months of the last Iranian calendar year.

The country produced 989,110 cars in 2012, which made it Asia's eighth largest car manufacturer. Iran's automobile output faced a 40 percent decrease in 2012 due to sanctions. The country was Asia's 5th largest car manufacturer in 2011, with a total output of 1,648,505.

Officials of Iranian automotive industry started to make positive forecasts after the suspension of the sanctions. Early in February Yekke Zareh said that the IKCO manufactures with only 60 percent of its production capacity, expressing hope that the company will manufacture with 100 percent of its capacity by June, 2014.

About 69 automobile manufacturer units have been closed and 115,000 people lost their jobs in the automobile sector of Iran during the past two years due to pressure of the sanctions.

Western countries suspended certain sanctions against Iran as the Geneva nuclear deal came into force on Jan. 20. Iran was permitted to import materials for its auto manufacturing sector as a result of the nuclear deal implementation, which has led to sharp increase in country's auto exports in recent months.

Iran exported 10,744 sedans during the last Iranian calendar year (ended on March 20, 2013), with some 4,231 of that amount only exported in the latest Iranian month.

The country exported $27 million of sedan cars only in the last calendar month which is even more than half of the total yearly export value.

Iran produced 655,551cars in the first eleven months of the last Iranian calendar year.

The country produced 989,110 cars in 2012, which made it Asia's eighth largest car manufacturer. Iran's automobile output faced a 40 percent decrease in 2012 due to sanctions. The country was Asia's 5th largest car manufacturer in 2011, with a total output of 1,648,505.

Officials of Iranian automotive industry started to make positive forecasts after the suspension of the sanctions.

Early in February Yekke Zareh said that the IKCO manufactures with only 60 percent of its production capacity, expressing hope that the company will manufacture with 100 percent of its capacity by June, 2014.

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