Economy, Business And Markets

Auto Parts Producers Near Bankruptcy

Auto Parts Producers Near Bankruptcy
Auto Parts Producers Near Bankruptcy

Iran’s Auto Parts Manufacturers Association says if Iran Khodro and SAIPA do not pay their debts to auto parts manufacturers, they will soon become bankrupt.

“Automakers’ debt to parts manufacturers has reached 5.5 trillion rials (around $157 million at market exchange rate), 2 trillion ($57 million) of which pertain to overdue receivables,” ISNA quoted Arash Mohebbinejad, an official with the association, as saying.

According to the official, these companies are currently operating at 50% capacity.

Nearly 190,000 people are employed in 1,200 Iranian auto part manufacturers.

About 10,000 people working in auto part manufacturing units have lately been laid off or temporarily suspended as a result of recession in Iran’s auto industry.

Iran’s car output during the 12-month period ending March 19, 2016, decreased by 13.7% year-on-year, as Iranian companies manufactured 976,836 cars.

Two-month output since the beginning of the current Iranian year (started March 20) stood at 158,571 vehicles, indicating a 2.8% fall.