An automotive official has rejected the claims of four ministers who recently said 100,000 vehicles have been stockpiled due to low demand.
According to Mohammad Reza Najafimanesh, a member of the board of directors of the Auto Parts Manufacturers Association, only 6,000 surplus vehicles are stored at Iran Khodro Company while SAIPA has no surplus vehicles, Bourse Press reported.
IKCO and SAIPA are Iran’s first and second largest vehicle manufacturing companies. He noted that IKCO produces 32,000 vehicles on average monthly.
In a letter signed by the ministers of economy, industries, labor and defense, which was addressed to President Hassan Rouhani, the officials warned about the recession in the auto industry.
Disclosed early in October, it openly censured “the discord within the policymaking state bodies” and called for a prompt decision to address problems plaguing the capital market.
Najafimanesh noted that recession is not just prevalent in the auto sector, but also in sectors such as “housing, cement, iron and household appliances”.
Commenting on the newly announced auto loans worth 250 million rials ($7,200 at market exchange rate), the official said customers and automakers demand that auto loans be provided promptly by the government so that customers could purchase locally-made cars.
“The best solution is for the administration to provide cheap loans to the automakers and the people,” he said.
The official added that lower interest rates on loans will boost economic development and vehicle production.
The online campaign boycotting domestic cars due to their high price and low quality has led to a slump in production.
“Local carmakers have what it takes to produce vehicles with better quality,” he said, adding that logically the new models will cost more than older ones.
Najafimanesh suggested that if the auto industry is privatized and the government merely oversees the car market instead of interfering in automotive affairs, “that would benefit the industry”.
Noting that in foreign countries each car works for no more than 10 years, he said the same number in Iran is between 15 to 20 years. In the current fiscal year (ending March 19, 2016), plans have been prepared to induct 200,000 new vehicles and scrap the clunkers.
