Baku, Azerbaijan, August 19
By Umid Niayesh - Trend:
The US sanctions which target Iran's automotive sector, were re-imposed on August 6, however the sector performance started falling even months before the embargo comes into force.
Iran’s car output which was witnessing growth for several months, following the removal of the international sanctions in 2016, but the official statistics indicates that the growing trend has become negative in recent months.
Leading European and Asian companies including Peugeot Citroen, Mazda and Hyundai were among the car manufacturers that already left the country due to the threat of US sanctions.
The statistics released by Iran’s industry ministry unveils that the country’s leading auto manufacturers including Iran Khodro, Saipa and Pars Khodro have witnessed output fall in the first four months of the current fiscal year (March 20-July 21).
The three leading companies manufactured 361,537 passenger cars in the 4-month period, 3 percent less year-on-year.
Iran Khodro, the country’s biggest auto manufacturer, had a share of 182,309 units of the country’s passenger car output in the period, 11.4 percent less year-on-year.
Saipa, the second biggest auto manufacturer of Iran, however improved its performance by 13.2 percent in the 4-month period to 113,472 passenger cars.
In the meantime, Pars Khodro produced 65,756 passenger cars, 0.3 percent less compared to the first four months of the preceding year.
The official statistics also indicates that the output fall trend continued in the fourth calendar month (June 21-July 21).
The three car manufacturers produced 78,780 passenger cars in the first month of summer, ahead of re-imposition of sanctions, 11 percent less compared to the preceding month.
Iran Khodro’s output was 38,496 passenger cars (16.1 percent fall month-on-month), followed by Saipa (24,262 cars, 5.5 percent monthly decrease) and Pars Khodro (16,022 passenger cars, 5.5 percent decrease compared to the preceding month).
The sharp fall of Iran’s passenger car output increased in the third calendar month (May 21-June 21), when the sector witnessed a 30-percent production decrease compared to the preceding month.
The experts forecast that Iran’s auto sector will witness even more decrease in coming month as the sanctions will cut the flow of car parts to Iran and the parts for assembling cars in Iranian companies’ stores will be depleted.
The intensive sanctions which targeted Iran’s auto sector in 2012, led to a 40 percent decrease in the country’s car output, however the sector revived following the removal of the international sanctions in 2016. The country was Asia's fifth biggest car manufacturer in 2011, with a total output of 1,648,505.
Amid the decline of car output in Iran, the production of Chinese auto models has witnessed a significant rise. In total 41,157 Chinese passenger cars were manufactured in Iran during the first four months of the current fiscal year, 40 percent more year-on-year.
It seems that Iran’s auto industry will shift more to Chinese partners under the sanctions, and Asian country will enjoy the privileges of the Islamic Republic’s 80-million market due to a lack of the powerful competitors from Europe, Japan and South Korea.