Volume. 11875

French carmakers poised to re-enter Iran market
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The French car industry is seeking to win back its once dominant position in the Iranian market following a nuclear agreement between Iran and the six world powers in Geneva last month.
Renault hopes that it can reclaim a large part of the market share it had in Iran before leaving the country due to US-engineered sanctions imposed on the Islamic Republic over its nuclear energy program, the Financial Times reported on Thursday.
“There is a lot of diplomacy still at work. Clearly, the outlook compared to a year ago…looks more positive today,” said chief financial officer of Renault, Dominique Thormann, adding, “What we were doing previously could be restarted. If all of that [sanctions regime] is lifted, presumably business will start just as we left it.”
On July 1, Renault was forced to halt completely knocked down (CKD) shipments to Iran when the US government extended economic sanctions against Iran to the automobile sector.
On July 26, Renault reported a huge fall in profits for the first half of 2013 after writing off the entire value of its business in Iran. The firm took a 512-million-euro (680-million-dollar) charge after halting its activities in the Islamic Republic.
Last year, Renault sold a total of 100,783 vehicles in Iran, and had a 10-percent market share. The Middle Eastern country was Renault's eighth-biggest global market by sales, above Italy where Renault sold 96,144 units and Spain where it sold 83,366 cars.
Meanwhile, rival French vehicle manufacturer PSA Peugeot Citroen is in line for return to the Iranian car market, which was once its second biggest after France.
The French automaker experienced an estimated four billion euros in lost sales after cutting ties with the Iranian car manufacturer Iran Khodro Co. in February 2012 under pressure from its American partner, General Motors. The second-largest Europe-based automaker also cut 8,000 jobs.
In 2011, Iran accounted for 13 percent of Peugeot’s annual sales.
“We welcome the positive results from the negotiations in Geneva, which could lead to the suspension of sanctions, and we will now await further developments,” a spokesperson for Peugeot said.
On November 24, Iran and the five permanent members of the United Nations Security Council -- the United States, China, Russia, France and Britain -- plus Germany sealed an interim deal in Geneva to pave the way for the full resolution of the West’s decade-old dispute with Iran over the country’s nuclear energy program.
In exchange for Iran agreeing to limit certain aspects of its nuclear activities, the six powers have agreed to lift some of the existing sanctions, including in the car industry, against the Islamic Republic.
(Source: Press TV)

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