Iran Welcomes Auto Ties With Italy

Iran Welcomes Auto Ties With Italy
Iran Welcomes Auto Ties With Italy

Several auto industry pundits believe the prospective auto deal with Fiat might have been overstated by the Iran’s Minister of Industries, Mining and Trade Mohammad Reza Nematzadeh.

Nematzadeh made the announcement about the possible deal with Fiat at a press conference with Italy’s deputy minister for economic development, Carlo Calenda. It was held on the sidelines of the conference dubbed “Iran-Italy Business Forum” in Tehran on Sunday.

Calenda is heading a 370-strong delegation, including representatives of 178 Italian companies, 20 associations and 12 banking groups. However, Fiat was not represented in the delegation, Eghtesad News wrote.

While Italian auto part makers were present in the delegation that visited Iran, experts have said that the absence of Fiat from the event probably means that the company is not one of the potential business partners for Iran.

And that the comments were either taken out of context or just factually incorrect. Something that the Iranian officials have not responded to, as Financial Tribune went to print.

 3m Vehicles in 10 years

Nematzadeh had said Iran plans to produce 3 million vehicles over the next 10 years and it is expected that a third of that amount will be exported.

According to Mehr News Agency, the minister added that “we are seeking reliable business partners for the auto industry who are willing to set up joint ventures”.

Negotiations with several European car companies are almost complete and the business contracts will soon be completed, he said at a press conference.

Nematzadeh also said Iran has been negotiating a deal with the Italian Fiat corporation but the negotiations are in their “initial stages”.

Fiat and Iran were in talks 10 years ago so that the Italian company would produce cars in Iran. However, due to the fact that the Italian company is in part owned by America’s Chrysler and sanctions were imposed on Iran by the West, a deal was not signed.

Nematzadeh has now said Iran is open to the idea of the company producing bi-fuel engines as well as lightweight and commercial vehicles in Iran.

He stressed that Iran’s foreign investment policies have always been and will continue to be centered on “foreign companies setting up joint ventures here.”  

Licia Mattioli, the head of General Confederation of Italian Industry’s Technical Committee for Internationalization and Foreign Investors, said from March 2014 to March 2015, co-production of cars, buses and trucks was discussed and Italy’s strategic plan for the future is to produce 2 million Iranian-Italian vehicles but no one mentioned Fiat being part of that.

Announcing plans for vehicle cooperation between Iran and Italy, Calenda said Italy will help Iran become the eighth biggest car manufacturer in the world by increasing car production to over 3 million a year.

 “We are trying to get Iran to the eighth global manufacturer of automotive up till 2018 since Italy enjoys a wide choice of car production equipment and is able to expand cooperation with the aim of resuming production,” he said.