Azerbaijan, Baku, July 16/ Trend N. Umid/
Iranian grand auto production companies are negotiating with Chinese auto companies on common cooperation, Jahanesanat daily quoted faculty of K.N. Toosi University of Technology, Shahram Azadi as saying.
"Cooperation with Chinese auto production companies is a short term solution for neutralizing sanctions, meanwhile the long term solution is developing domestic production capacity," Azadi said.
Moving from assemblage to production in auto production industry is so hard in at the being time linked to western sanctions and liquidity shortage, Azadi added.
In an executive order, the U.S president approved sanctions against people who do business with Iran's auto sector, which the White House said was a major source of revenue for Tehran.
The order authorizes sanctions against those who sell, supply or transfers to Iran goods or services that aid in making light and heavy vehicles such as passenger cars, trucks, buses, minibuses, pick-up trucks and motorcycles. The sanctions focused on the auto sector also target foreign financial institutions.
South Korean companies have officially announced that they will not accept orders from Iran for selling car parts to them.
According to projections, the sanctions will lead to a 40 per cent rise in production costs in Iranian car-making companies as Korean suppliers used to provide Iranian companies with 60 per cent of their needs.
European main car companies including Renault, Peugeot and Fiat also halted their activity in Iran.
Iran's auto production has decreased by 56 per cent in May compared to the same period in 2012 and it's auto export dropped from about 6,000 in March 20-May 20, 2012 to 1,000 cars in same period in the current year.
According to the statistics, about 69 auto manufacturer units have been closed and 115,000 people lost their jobs in auto sector during the past two years.