Economy, Auto

Two Bus Production Lines Stop Rolling

Two Bus Production Lines Stop RollingTwo Bus Production Lines Stop Rolling

Iran Khodro Diesel, a heavy goods vehicle producer and subsidiary of Iran’s largest carmaker Iran Khodro Company, and Oghab Afshan, a producer of Scania branded buses in the Islamic Republic produced no new buses in the previous Iranian month of Ordibehesht (ended May 20).

Both Oghab Afhsan and Iran Khodro Diesel face many of the similar issues afflicting the entire automotive industry: a lack of buyers to buy their products, ISNA reported.

Industrial vehicle buyers are stymied by a lack of credit from financial institutions and high lending rates.

In the previous Iranian year, during the same month, Oghab produced 15 vehicles y/y whereas IKD produced one bus by the Chinese company Zhengzhou Yutong.  

In a Financial Tribune report in December 2014, Iranian bus manufacturers recorded zero output during the Iranian month of Aban (ended November 21), ISNA reported at the time.

The industry faced a continuous decline year-on-year during the period, according to that report, as major bus manufacturers produced 32 buses, including 12 by Runiran company, two by Iran Khodro Diesel, 3 by Zamyad, 6 by Akia, and 9 by Oghab Afshan.

Iran annually needs 4,000 buses to better equip its domestic transportation system. Since the 1970s, Iran has been producing buses jointly with European companies, including Germany’s Mercedes and MAN as well as Sweden’s Scania and Volvo.

Daewoo Bus Corporation and Iranian automaker Ardebil Sabalan Khodro teamed up in 2010 to build buses. The joint venture was aimed at producing 800 city and intercity buses, but the contract was terminated shortly afterwards and the Iranian company started another joint venture for producing Chinese buses.

Iran’s bus industry has faced severe underinvestment in recent years, with the average age of intercity buses now at 15 years on average.