Domestic Production of Tour Buses Behind Schedule

Iranian automakers will soon begin the production of two models of tour buses, five months after the Ministry of Industries, Mining and Trade rejected a proposal by the tourism authority to remove or reduce tariffs on 1,000 imported tour buses.

“Industries Minister Mohammad Reza Nematzadeh provided us with a catalogue of the two models that will be produced by domestic car manufacturers,” Masoud Soltanifar, the head of Iran’s Cultural Heritage, Handicrafts and Tourism Organization, was quoted as saying by ISNA.

The ministry had promised that Iranian carmakers would be able to provide ICHHTO with the 1,000 vehicles they have requested by September, but evidently they have not even begun production yet.

In May, a proposal made in late 2014 by Iran’s Cultural Heritage, Handicrafts and Tourism Organization to reduce the tariff on a number of imported tour buses to renovate the aging fleet of substandard coaches was rejected by the Cabinet.

Officials at the ministry, who were opposed to the scheme from the outset, argued that the move would undermine Iranian automakers, which they claimed are capable of meeting the land transport needs of the fledgling tourism sector.

The organization had requested tariffs to be removed from only 1,000 vehicles, including tour buses.

A month later, tourism officials, along with industry heavyweights, began discussing the matter with Iran’s Customs Administration to get the government to reverse its decision on the proposal.

However, it was reported in August that the efforts had failed, with ISNA quoting the president of the Trade Promotion Organization of Iran as saying that scrapping the tariff is legally impossible.

Valiollah Afkhami added, “It’s the law; it doesn’t allow imported cars to enter the country without a certain fee.”

Local media say the Industries Ministry’s reasons for rejecting the proposal were twofold: First, to help empower domestic carmakers by compelling tour companies to buy Iran-made buses; and second, to boost government coffers by levying customs tariffs.

“They [the Industries Ministry officials] argue that reducing customs tariffs for imported buses will undermine domestic automakers,” Soltanifar said in June.

This is while some, including Ebrahim Pourfaraj, president of the Iranian Tour Operators’ Society, say Iran-made buses fail to meet international standards.

“They mount the body of a minibus onto the chassis of a sedan, so how can you call that a standard vehicle?” he complained.