Domestic car parts manufacturers have a week to receive an ID and tracking code, otherwise their products will be considered contraband or counterfeit, and confiscated.
The Association of Brake and Clutch Manufacturers organized registration for car parts distributors with the help of the Ministry of Industries, Mining and Trade, after the ministry set a one-week deadline to register and receive the ID and tracking code from the Comprehensive Trade System for brake-pads and 54 other parts.
Masoud Hassanpour, secretary of the Association of Brake and Clutch Manufacturers, said failure to receive the ID and tracking code will lead to confiscation of parts from July 6, Donyaye Khodro reported.
He explained that, for example, an ID is issued for a model’s shock absorber but a tracking code must be received for each shock absorber, stressing that parts manufacturers were informed about this issue several months ago.
"If a product is problematic, its tracking code can help identify it and also assist in weeding out smuggled and counterfeit goods. Therefore, parts without an ID and tracking code are considered counterfeit or smuggled," he added.
The association’s secretary noted that not all the 55 parts were named en bloc, as brake-pads were added to the list a few months later than shock absorbers and batteries.
Hassanpour said a meeting was held recently at the association and officials from the Industries Ministry briefed manufacturers and set out to resolve any problems in this initiative.
Auto Spare Parts Top Contraband
Automotive spare parts topped the list of smuggled goods in the fiscal 2021-22 (ended March 20), according to Spokesman of the Headquarters to Combat Smuggling of Goods and Foreign Exchange Hamid Reza Dehqani-Nia.
He announced that $17.1 billion worth of smuggled goods entered the country in the fiscal 2020-21.
The spokesman noted that after car spare parts, food was the second largest category of contraband last year, while computer equipment and home appliances respectively ranked third and fourth in the fiscal 2021-22, the news portal of Iran’s Chamber of Commerce, Industries, Mines and Agriculture reported.
According to Dehqani-Nia, many household appliances in the Iranian market are counterfeit.
"These products are Iranian goods fabricated or repaired in unofficial workshops and sold in the domestic market as foreign and banned brands," he said, without mentioning the value of smuggled car spare parts.
Mohammad Reza Najafi-Manesh, a member of the Tehran Chamber of Commerce, Industries, Mines and Agriculture and chairman of the Association of Homogeneous Propulsion Industries and Component Manufacturers, said although car spare parts topped the list of smuggled goods, it is not clear how much was smuggled into the country and how many were produced by underground and unofficial domestic units.
“The problem with evaluating this volume of smuggling is that it is not clear how much of these goods were imported and how much was produced illegally. In other words, if a product is found to be illegal, it may have been smuggled into the country, or illegally produced by unlicensed units inside the country,” he added.
Najafi-Manesh noted that another problem is that the size of the spare parts market in Iran is not known.
“Therefore, it was decided that ISACO, SAIPA Yadak and the Association of Homogeneous Propulsion Industries and Component Manufacturers cooperate to examine the volume of the spare parts market and determine how much of it is domestic and what percentage comprises counterfeit production and smuggling,” he added.
In the field of auto parts, domestic car batteries and tires were obliged to have ID and tracking codes, and it was decided that 55 other commodities produced by 173 domestic companies would receive ID and tracking codes.
Najafi-Manesh noted that Iran has 1,500 car component and spare parts producers.
High Car Imports to Impact Spare Parts Market
A spokesman of the Tehran Auto and Machinery Parts Dealers Association explained the impact of car imports on the spare parts market.
“New cars do not need a part replacement when they hit the market, and typically incur costs, including replacement or repair, after one to two years. At present, sellers and importers, and members of the guild, supply and import the parts needed by these cars,” Mehdi Kazemi was also quoted as saying by Khabar Khodro.
He noted that the domestic spare parts market will benefit from car imports, but will be disadvantaged by the exit of worn-out cars.
Asked whether the priority of spare parts producers is to make parts for domestic or imported cars, Kazemi said, “This depends on the number of imported cars because if, for example, they are fewer than 500, due to the high cost of production, parts manufacturers will not supply parts for these cars. Instead, importing companies are obliged to provide parts and after-sales services for imported cars through dealerships.”
The official underlined that parts supplied by dealerships must be 100% original and standard, but when suppliers do not have access to the original parts, they order parts, for example, from Chinese factories.
Referring to the 20% price increase in the spare parts market, Kazemi said, “The sharp rise in the US dollar has led to a sharp decline in supply and lower demand. Unfortunately, the spare parts market is currently in a complete recession.”
Uncertainty about the prices of parts due to exchange rate volatility in the domestic market has led to a halt in the sale of parts.
