Iran to save €85m in a year by indigenizing auto parts

July 20, 2019 - 21:8

TERHAN - Iranian Deputy Industry, Mining and Trade Minister for Industrial Affairs Farshad Moqimi said the country’s car makers will soon sign deals worth $7.4 trillion rials (about €157.4 million) with domestic spare parts manufacturers, which will save the country €85 million in a year.

According to the official, based on the mentioned contracts, 32 domestic car parts manufacturers will manufacture 35 different items which are currently being supplied by foreign manufacturers.

Moqimi also said that five specialized workshops and meetings are scheduled to be held this year in order to discuss and explore ways for indigenization of automobile industry.
In early May, Iran’s Industry, Mining and Trade Minister Reza Rahmani has stressed that the policy of domestic manufacturing of auto parts should be seriously followed up.

Given that 1.25 million vehicles are anticipated to be manufactured in the country during the current Iranian calendar year (ends on March 19, 2020), the part manufacturers will need 150 trillion rials of working capital (about $3.571 billion) for the purchase of raw materials and other required items.

As previously announced by Industry, Mining and Trade Ministry, Iranian carmakers manufactured 42,623 vehicles during the first Iranian calendar month of Farvardin (March 21-April 20, 2019).

The ministry’s data show that car manufacturing in Iran has fallen 47.2 percent in the first month of this year from 80,794 cars manufactured in the same month of the previous year.
Earlier this month, Moqimi had also stressed that the regulations should be in a way that remove the barriers in the way of domestic production.

“When a regulation is set, it may remove a problem but creates another one. Taking this issue into account and also considering the special current condition of the country, some special approach should be taken when setting the regulations”, the official said.

In late May, Moqimi had announced that Industry, Mining and Trade Ministry will launch a comprehensive system for registration of domestically-made products in near future.

EF/MA

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