The prices of all types of cars are declining, that of costly models significantly and that of economy models marginally, amid the recession dominating the domestic market in recent weeks.
Expectations about the arrival of new imported cars have caused prices to decline further and some foreign models have surprisingly experienced a hefty price decline of up to 20 billion rials ($40,000), according to the head of Iran Auto Dealers Association.
“There was an average decline of 30-50 million rials [$60-100] in the price of domestic cars and a drop of 100-150 million rials [$20-300] for assembled cars in the past few days,” Saeed Motemani was also quoted as saying by IRNA.
He added that there are no customers in the market, except those who are first-time buyers, or those who intend to replace their old car.
“We may see a slight increase or decrease in prices on some days, but in general, the market is calm. We really need new imported cars. The law to import cars has been ratified by the parliament, and considered by the State Expediency Council. Therefore, it is expected that the rules and regulations of car imports would be prepared as soon as possible,” he said.
Motemani noted that the price of imported cars worth 100 billion rials ($202,474) has registered a decline of 20 billion rials ($40,494) while that of cars worth 50 billion rials ($101,237) declined by 10 billion rials ($20,247) in the past few days.
According to the official, the prices of cars worth 30 billion rials ($60,742) and 40 billion rials ($80,989) declined by 7 billion rials ($14,173) and 5-6 billion rials ($10,123-$12,148), respectively.
Referring to the new prices of assembled cars announced by the National Competition Council, he said the new prices have not had any impact so far, and in some cases, prices dropped because the market is in recession.
Motemani stated that cars will definitely be imported this year, that's why we are witnessing the withdrawal of people who wanted to invest in this market.
“In such a situation, if car supply increases, prices will decrease even further. But if car imports are facilitated, it will benefit both the consumer and the market,” he said.
The prices of cars produced by SAIPA and Iran Khodro, the top two Iranian automakers, have declined by 10-70 million rials ($20-$141) while the prices of assembled cars have registered a 100-950-million-rial ($202-$1,923) drop in the past week.
Forex Supply Poses Biggest Hurdle to Used-Car Imports
Problems related to foreign exchange allocation are the main hurdle to the import of used cars, according to the former spokesperson for the Ministry of Industries, Mining and Trade.
Omid Qalibaf also told the Persian automobile daily Donyaye Khodro that the import of used cars will take place, if the required forex is allocated by the Central Bank of Iran.
However, much remains to be done in terms of procedures before used cars could be imported.
“The Majlis ratification can be implemented with the approval of the Guardians Council and the State Expediency Council. The next step is to announce the law to the government, prepare executive regulations and finally notify the Ministry of Industries, Mining and Trade for implementing it, which will take time. So it is unlikely that this will materialize in the next two months,” he said.
The former Industries Ministry spokesperson said obtaining permits from the Department of Environment and the Institute of Standards and Industrial Research of Iran is also problematic.
“Therefore, the import of used cars will not be easy, assuming that the currency and sanctions situation in the country remains the same, but it is possible,” he said.
Referring to the impact of this law on the car market, Qalibaf said, “The important issue is how the executive regulations are devised. If real buyers are allowed to import cars without a commercial card, as it was previously stated in the draft proposed by the Industries Ministry, we could be optimistic about the regulatory effect of this law.”
The approval of the law to import used cars had made people optimistic about a fall in car prices.
“But if strict regulations are set, the law itself will become an obstacle to its implementation. In any case, the psychological impact of the law was apparent in the last two or three days with the decline in the prices of used foreign cars,” he said.
Qalibaf stated that if these obstacles are not taken care of, it could again lead to a price hike.
Asked why the import of used cars did not materialize when it was raised last year, he said, “Last year, there was a good resolution regarding the import of used cars from free zones, but it was rejected by the State Expediency Council.”
