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Why car price in Iran rose after rise in petrol price?

Business Materials 28 November 2019 17:47 (UTC +04:00)
Why car price in Iran rose after rise in petrol price?

TEHRAN, Iran, Nov.28

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Referring to rise in car prices as petrol price hike in Iran, an expert in the automotive industry Hassan Karimi Sanjari told Trend that any change in the gasoline rate should not affect the price of the car, but since public transport is not suitable in Iran, people are forced to use their own cars.

“In developed countries, there is little need for private cars to travel to be used in cities, as the conditions for public transportation are favorable," the analyst of Iran’s automotive sector said.

"On the other hand, inflation is high in the Iran and private car is playing the role of asset for individuals," said Sanjari. “The sudden rise in gasoline prices will surely have a direct impact on rising inflation.”

The expert went on to emphasize that although in the past few months, automakers have been able to speed up production, they have been lagging behind in terms of parts production over the past two years, and obviously demand for the vehicle has increased.

"In this situation, auto makers are not going to benefit, because rising car prices in the market do not rise the basic-factory price very much," Sanjari said. "The balance of the car market is disrupted by the decline in supply."

Recently, the price of gasoline sold within quotas in Iran rose by 10,000 rials (23 cent) to 15,000 rials (35 cent) per liter and the price of freely sold gasoline grew to 30,000 rials (71 cent) per liter.

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