Over 80% of Iran’s car parts made by domestic manufacturers

Business Materials 5 June 2018 12:49 (UTC +04:00)

Tehran, Iran, June 5

By Kamyar Eghbalnejad- Trend:

Domestic manufacturers are capable of producing more than 80 percent of car parts needed by the country’s automakers, said a member of the Board of Directors of Iranian Automotive Parts Manufacturers Association.

“More than 80 percent of the components installed on Iranian vehicles are made domestically,” Mohammad Reza Najafi-Manesh told the YJC news agency on June 5.

Referring to the rising prices inside the country, he said prices of the metals needed for manufacturing car parts, including copper, aluminum, steel and lead have been doubled.

Najafi-Manesh noted that fluctuations in the country’s foreign exchange market have not that much effect on the prices as the country supplies 95 percent of the raw material needed by the manufacturers.

Iranian manufacturers produced 1.6 million automobiles in 2011, about half of them by the country’s giant auto manufacturer Iran Khodro.

However, Iran’s production of automobiles dropped in 2012 as a result of the US-engineered sanctions.

The sanctions were lifted in early 2016 after Iran reached a deal with the five permanent members of the Security Council plus Germany over its nuclear energy activities.

After the deal was clinched, Iran’s auto industry witnessed a significant growth by striking numerous agreements with foreign firms and manufacturers.

However, the industry may suffer a setback following Washington’s decision to quit the deal, known as JCPOA.

US President Donald Trump announced on May 8 that Washington was walking away from the nuclear agreement, which was reached in 2015 between Iran and the five permanent members of the UN Security Council - the US, Britain, France, Russia and China - plus Germany.

Trump also said he would reinstate US nuclear sanctions on Iran and impose "the highest level" of economic bans on the Islamic Republic.

The US sanctions have a 180-day period during which buyers should “wind down” purchases.