Iran, Algeria sign agreement on joint car production
Baku, Azerbaijan, Dec. 19
By Fatih Karimov- Trend:
Iran and Algeria signed a Memorandum of Understanding (MoU) to jointly produce cars in Algeria.
Iran's giant car manufacturer Saipa and an Algerian company signed the document, which will come to force from mid-2016, Mehdi Jamali, Saipa's CEO said, the company's official website reported.
The document was signed on the sidelines of Iranian Vice-President Eshag Jahangiri's visit to Algeria Dec. 16-17.
Initially, about 20,000 cars will be annually produced in the country, he said, adding Saipa's five sedan models will be produced jointly with Algerian counterpart.
He did not mention further details about the Algerian company.
It is the first time that the two countries cooperate on auto production, Jamali said, adding the value of the products is planned to reach $20 million per year.
The contract's value can increase to $100 million worth of production per year, in coming years, he said.
Earlier in 2008 SAIPA signed an agreement with Algerian Rahmun Industrial Group for establishing an assembly line in the African country.
About 15,000 cars were expected to be produced annually in the first phase, however the agreement was not realized.
More than 1.13 million cars were produced in Iran in the past Iranian fiscal year, which ended on March 20.
Sedan cars output stood at 958,335 in the mentioned period, a 53 percent rise year on year.
Iran produced 989,110 cars in 2012, which made the country Asia's eighth largest car manufacturer. Iran also stood at the world's 18th place in the mentioned year.
The Islamic Republic's car output faced a 40 percent decrease in 2012 due to the sanctions. The country was Asia's fifth largest car manufacturer in 2011, with a total output of 1,648,505.