$15 billion foreign currency required for car imports to Iran
TEHRAN, Iran, Oct.21
The secretary of Iran Vehicle Manufactures Association Ahmad Nematbakhsh criticized comments of the governor of Central Bank Iran (CBI) on car making in Iran and said that if the national automobile industry collapses, it would cost up to $15 billion a year to import cars.
"The head of the central bank does not know that the car makers have been financially repressed," Ahmad Nematbakhsh said at a meeting of the Association of Automotive Parts on Monday, Trend reports citing IRNA.
“Total car production declined 35 percent in the first half of this Iranian year (began on March 21 2019), compared to the same period last year,” said Nematbakhsh.
“Last year, it was found that all cars had been sold with a loss. Iran's Khodro and Saipa automaking companies faced up to $1.9 billion losses each over the past six months," the official announced.
Nematbakhsh criticized the government's failure to comply with the Fifth Development Plan on payment of aid to car makers.
"According to the law, if for any reason the government's price of goods is lower than the actual price, the government must pay compensation, but no action has been taken so far for automakers,” he added.
Nematbakhsh went on to mention the rise in raw material prices as the main cause of losses in the automotive industry.
“The rate of the foreign currency has increased threefold and the cost of shipping has increased more than threefold since the beginning of last Iranian year [ended on March 21, 2019]; that's why the automakers are unable to pay debts to autoparts makers,” Nematbakhsh said.
On Oct. 20, Head of CBI Abdol Nasser Hemmati said at a meeting of the Iranian Chamber of Commerce that the country's auto industry needs to be reformed. "How long will this vicious car making process in the country continue and for how long we [as administration] have to pay the cost of it?”, he asked.