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9.1.2 Automotive sector news
IRICA confirms exports of Iran assembled cars and trucks at $5.7mn for last year
Motor oil prices in Iran rise 50% as rial tanks
Iran’s vehicle makers post production gain of 23.4% y/y for first half of Persian year
The export value of cars and trucks assembled in Iran topped $5.7mn in 2019, the Islamic Republic of Iran Customs Administration (IRICA) said on November 22, releasing newly confirmed figures.
Iran’s auto industry has been under US sanctions for the past two years but it has continued to export vehicles and localise car models. Most recently, SAIPA announced a version of the Dacia Logan that was almost entirely manufactured with localised parts. The car is normally produced by Renault and its Romanian subsidiary Dacia. Renault exited Iran after the US reimposed sanctions on Tehran.
IRICA spokesperson Ruhollah Latifi said that around 1,300 cars and trucks were exported from Iran to nine countries last year. He identified eight of the countries, namely Hong Kong, Taiwan, Syria, UAE, Spain, China, Iraq and Turkey.
He said the value of the vehicles that went to Iraq was $3.1mn, while for Azerbaijan the figure was $1.16mn and for Syria it was $981,825. The three countries formed the top three recipients of Iran-assembled cars and trucks. Some auto exports from Iran go through unofficial channels. Non-Iranians purchase the cars inside Iran and re-register them abroad.
The unit price of motor oils for petrol and diesel vehicles is set to increase by 50% in Iran following an agreement struck by interested parties, ISNA reported the head of the Iranian Mechanics Union as saying on November 2.
Pricing on locally produced auto parts as well as 30 and 50 grade motor oils is agreed by the organisation annually. The severe devaluation of the Iranian rial against the dollar has made a sharp impact on available local prices.
Union head Alireza Nikiyan noted that price increases on auto parts and motor oil has caused car owners to opt against having their vehicles serviced at the garages of regular mechanics.
Motor oil prices in Iran have risen by 50% over the past year.
"Compared to last year, the number of people referring to these garages for car repairs has decreased significantly,” he said.
He added: “This shows that most of the cars on the roads in the country must be defective and that poses many dangers to both drivers and passengers.” Nikiyan added that counterfeit oils have flooded the Iranian market, with people looking for cheaper ways to keep their car running.
“When people cannot buy motor oil at a high price, it forces them to buy cheaper oils, which are sometimes of inferior quality and lack standards,” he said.
Vehicle manufacturers in Iran recorded a 23.4% y/y increase in production in the first half of the 2020/2021 Persian calendar year (March 20-September 21), ILNA reported on September 30.
Car buyers in Iran plainly have limited options when it comes to affordable cars, with Peugeots and Renaults the bigger names among the well-known global auto brands that are available. Due to constraints on the auto industry in Iran, buyers must purchase their car as a pre-order and wait several months for their vehicle to arrive.
Some, 468,699 vehicles were reportedly manufactured during the first half.
Of those, 425,925 were passenger cars, with the category seeing growth of 21.9% y/y. Also, 39,519 lorries and light trucks were produced in Iran during the six months.
42 IRAN Country Report December 2020 www.intellinews.com