In recent months and following the reimposition of US sanctions, prices of goods and services in almost all sectors have increased. Motorbikes are no exception.
Head of Iran Motorcycle Sellers Association Mohammad Khadem Mansouri tells ISNA manufacturers have increased prices between 30-40%! This is while prices in the market have more than doubled.
For instance, a 125cc two-wheeler made by Tak Taz Motor now costs 63 million rials ($443). In summer the same bike sold for 45 million rials ($316). Prices were much lower in spring when the same motorbike hardly fetched 26 million rials ($183).
A TVS Apache RTR 180 is sold at 110 million rials ($774). The same bike cost 73 million rials ($510) some three months earlier.
Prices of imported brands have also jumped so high as to join the expanding list of other unaffordable items for the working class. For instance, on Saturday a 250cc TNT motorbike made by the Italian firm Benelli was priced at 399 million rials ($2,810) on the online website Digikala.
Mansouri says, “Some avaricious dealers are putting exorbitant price tags on motorbikes.”
He points out to the almost three-fold increase in currency rates over the past six months and the economic challenges the nation is facing. “The significant increase in motorbike prices is largely due to the rising foreign exchange rates,” a patent and discomforting statement heard every day if one is in the marketplace and protests the high and rising prices
The national currency, the rial, has lost 70% of its value after the current fiscal began in March. On Saturday the greenback was traded at 142,000 rials in Tehran. A dollar hardly fetched 42,000 rials six months ago.
Large sections of local industries, including motorcycle manufacturers, depend on imported raw materials and parts. With the rial tanking and taking a regular beating, overheads have increased significantly, company managers say.
To preserve foreign exchange reserves the government of President Hassan Rouhani has introduced several plans to curb imports. The plans have so far only succeeded in hampering imports of intermediary goods, like vehicle and motorcycle parts, which in turn have undermined local manufactures.
Mansouri says, “Due to the economic problems and declining imports of parts and raw materials, local motorbike companies reported a steep decline in output.” He did not provide figures. In the recent past, annual motorcycle production of the two-wheelers was close to half million units.
>Demand Rising
Demand for motorbikes has reportedly increased recently. With the rial hardly worth the paper it is printed on and in a move economists bill as a textbook example of herd mentality, Iranians understandably anxious about losing their life’s savings and desperate in wanting to convert their cash into safe-haven assets, have turned to the forex, housing, and car markets.
Those who could not afford houses or vehicles purchased motorbikes. With increasing demand for the two-wheelers, dealers have had a field day charging people outrageous prices—seen by the public as outright robbery.
Moreover, car prices have also significantly increased. Bad news that translates into a simple message for the common man: cars are gradually becoming luxury items most families cannot afford.
As cars are becoming unaffordable, many households are turning to motorbikes as a means of transport, which again is troubling for those living in major urban areas.
Some 2.5 million carburetor-equipped motorcycles ply Tehran’s almost permanently clogged roads. Since they are not equipped with catalyst converters and release toxic fumes directly into the environment, the amount of pollutants each of the motorbikes spew into the air equals that of eight vehicles with Euro 3 emission standards. The added problem is that the bikes are fuel-intensive.
As if this was not bad enough, the outdated motorbikes are the number one culprits in creating noise pollution. It is estimated that in Tehran alone motorbikes have a 25% share in air pollution and cause almost half the noise pollution in and around the city of 12 million people.
While motorbikes account for barely 6% of the daily transportation in Tehran, the two-wheelers are becoming a major nuisance and are said to be responsible for 25% of traffic accidents in the metropolis.
