As more people join the "no to local cars" campaign, Iran's auto market plunges deeper into stagnation.
The grassroots campaign was at first brushed off by officials who refused to acknowledge its existence. Later, however, some officials responded by saying the campaign is harming the local automotive industry.
Hashem Yekezare, CEO of Iran Khodro Company, Iran's largest auto manufacturing company, claims that certain groups are profiting by supporting and promoting this campaign, Eghtesad News reported.
Without naming names, he further said the campaign has political support as certain parties aim to increase people's levels of expectation from the government of President Hassan Rouhani in the post-sanctions era.
"I am quite sure that certain political parties are benefiting by pushing this campaign and have been using it as an excuse for pushing their own political agenda."
Yekezare also claims that the "ephemeral" campaign will not result in a drop in car prices nor will it have a serious impact on production, "affecting production by 5%, at most."
According to Yekezare, after Iran and the six world powers reached a nuclear agreement, people have come to believe that prices will go down. Most buyers are waiting for new brands of higher quality.
While acknowledging the shortcomings in the auto sector, he stressed that car prices will not and cannot reduce.
"People have every right to be dissatisfied with car quality and after-sales services, however a drop in car prices is not feasible."
He explained that some believe the news about European auto partners entering Iran was released too soon, counting it as one of the reasons contributing to the auto market's stagnation. Yekezare said people should be informed of all the latest business developments, as this will help them make a better decision.
He noted that IKCO will soon be announcing the prices and exact release dates of its new models. The IKCO chief stressed that it will take a long time before new European brands enter the country.
In other words, people should not wait for an affordable vehicle of high-quality.
"Clearly, people will not be able to buy vehicles produced by Fiat and Volkswagen with the same money they are paying to buy a Pride or a Peugeot 405," he said.
The two locally produced vehicles fall under the $9,000 price range.
"If VW and Fiat bring their latest models to Iran, they will not be priced under $20,000."
He explained that only if the companies manage to produce 80-90% of the vehicles inside Iran, car prices will reduce, "which process may take up to four years".
According to Yekezare, new European brands, if produced 80% locally, will be priced at a minimum $8,000.
The Renault Kwid and Suzuki Celerio, for example, that are classed as affordable vehicles and will be offered in Iran in the near future, is expected to be priced at $8,800.
