Iran Khodro Company and France's Peugeot will officially launch their joint venture in late April.
Iran's Deputy Minister of Industries, Mining and Trade Mohsen Salehinia touched upon the latest status of bilateral collaboration between IKCO and Peugeot and said a joint venture denotes a 50-50 investment where the foreign side directly brings in 50% of the share in three stages.
Salehinia added that an independent company with a production line has been jointly established by IKCO and Peugeot since relevant licenses need to be received from Iran's Ministry of Economic Affairs and Finance before pursuing the registration process.
The official said the joint venture will become operational in late April after the board members, CEO, middle managers and supervisors of other sectors are appointed.
CEO of IKCO Hashem Yekezare had previously pointed to the signing of a contract with Peugeot by saying that it will bring foreign investment into the country, lead to job creation, increase production of auto parts and bring about transfer of know-how. He emphasized that the profits will be shared.
"During the first year, only 40% of the car's components will be indigenous while the figure will reach 70%, leading to a positive balance sheet on the part of the company,” he said.
Yekezare recently announced that the CEO of the joint company is an Iranian and the head of the board of directors is French while adding that the new cars will make their way to the market this year.
“Peugeot had left Iran in 2011 and we have set punitive terms for the French company, which is obliged to pay €200 million as compensation. Peugeot’s final business share will be only 15%,” he said.
