Tire Industry Wants Much Higher Import Tariffs

After persistent calls and pressure from tire manufacturing companies the Industries Ministry has proposed a new guideline on tire imports including higher tariffs. If ratified, the tariffs will be raised from the present 32% to 40%.

However, local producers say the eight percent increase is insufficient and would little to stop the flood of cheap imported tires.

Chairman of Iran Tire Industry Association Mohammad Reza Ganji says, “The import tariffs on tires should be over 60% if any meaningful change is intended” to help domestic companies stay away from downsizing and avoid insolvency,” local automotive website AsbeBokhar reported.

Censuring importers for dumping, Ganji says, “Due to their predatory pricing policies, substandard and cheap Chinese products now have 80% share of Iran’s imported tire market.”

Several Iranian companies including Kavir Tire and Yazd Tire produce tires for trucks and cars in large volumes. However, the production rate of some of their tires is relatively low and does not meet local demand. But Ganji insists that if imports are restricted local firms can increase their production rates and meet higher demand.

While both makers and government believe that increased tariffs can boost the industry, market observers are of the opinion that such policies will only lead to jacked up prices.