Talks With Int’l Home Appliance Makers to Revive Domestic Brands

Iran is in talks with American home appliance makers General Electric and Whirlpool, as well as Italy’s Ariston, to revive bankrupt domestic manufacturers, including Arj, according to an official with the Ministry of Industries, Mining and Trade.

“The ministry has initiated talks to sell Arj and similar [bankrupt] companies to the private sector, so that they can start joint ventures with credible foreign brands,” Abbas Hashemi was also quoted as saying by IRNA.

“Iran’s old home appliance factories have not been refurbished over the past decades. They have been using the same technologies since the day they were launched.”

The bankruptcy of Arj, Iran’s oldest home appliance manufacturer, grabbed the headlines in local media.

Being a state-owned firm with most of its shares belonging to Bank Melli Iran, companies like Arj faced rising expenses following their nationalization after the Islamic Revolution of 1979, which lowered their income and profits.

Under the circumstances, these firms attempted to save themselves by drawing on heavy loans and subsidized banking facilities, which accumulated their debt and led them to bankruptcy.

According to Teymour Rahmani, a lecturer at the Economics Department of Tehran University, “On the one hand, unrestrained banking facilities as well as direct and indirect subsidies were granted to these firms. On the other, the mismanagement of these businesses by state-affiliated bodies made them ineffectual and unproductive.”