Economy, Auto

Peugeot to Compensate Iran for Losses of Earlier Deals

Peugeot to Compensate Iran for Losses of Earlier DealsPeugeot to Compensate Iran for Losses of Earlier Deals

An Iranian official has announced that France’s Peugeot will compensate for its previous contract with Iran.

Mohammad Reza Najafimanesh, a member of Iran’s Car Manufacturing Policymaking Council, said Iran has set several conditions for foreign automakers interested in having cooperation. Accordingly, for manufacturing cars inside the country, the share of domestic components should be a minimum 40% that should reach 80% in an envisaged timespan, Mehr News Agency reported.

“The basis of joint collaboration between Iranian and foreign automakers needs to be production of cars inside the country through the real sense of the word rather than mere imports,” he said.

Najafimanesh further said at least 30% of the joint venture products need to be exported, as “investment in technology transfer has been included as another condition in foreign car deals by the Iranian Ministry of Industries, Mining and Trade.”

“Only countries and companies that comply with these conditions will be warmly received by Iran,” he said.

The official refuted any ongoing negotiations with American automakers by saying, “We have set general prerequisites for Asian countries, which need to be abided by all before the launch of cooperation.”

Referring to the deal with France’s PSA Peugeot-Citroen during the recent visit of President Rouhani to Paris, Najafimanesh noted that Peugeot has accepted all the stipulations and the company will produce auto parts domestically, in addition to undertaking exports.

"It has been agreed that the production would decline, if the export is less than the anticipated amount,” he said.

“The contract has been sealed in such a way that both France’s Peugeot and Iran Khodro Industrial Group will enjoy the benefits of implementing the joint project.”

Najafimanesh concluded that “Peugeot will make amends for all the losses of earlier deals by reimbursing Iran in full”.