Iran's Auto Exports Decline

EghtesadOnline: Data released by the Islamic Republic of Iran Custom Administration shows auto exports were meager during the first eight months of the current fiscal year (started March 2016).

News ID: ۷۷۲۳۸۶

17 December 2016

During the period, companies hardly exported 3,298 vehicles worth  $19.8 million. The number of cars shipped fell 86.5% compared to the same period last year when 24,500 units were sent to foreign markets.

Nearly 81%—2,677 units—of the cars exported were sent to neighboring Iraq. According to Financial Tribune's sister publication Donya-e-Eqtesad, the majority of the cars shipped were SAIPA Prides and Tibas -- the cheapest small sedans manufactured by Iran's second largest auto manufacturer.

In the same period the leading carmaker, Iran Khodro Company exported 306 units of Dena to Algeria. The company sent 100 units of different Peugeots to Turkmenistan and 116 units to Lebanon.

In November West Africa’s Cote d’Ivoire received 20 units of Iran Khodro’s Samand and Runna as part of a plan to refurbish the country's ageing taxi fleet.

The anemic figures are a testament to the fact that aging Iranian cars  are gradually losing the very last of the few customers overseas given the cut-throat competition in the saturated global auto market in which there are more sellers than buyers.

In November, the local media widely reported that the production of SAIPA’s Pride and Iran Khodro’s Peugeot 405 will stop before the current fiscal year is out in March 2017.

However, after those reports, the Ministry of Industries, Mining and Trade rushed to say that "no directive had been issued for phasing out cars" that are being produced in Iran as long as they meet quality, fuel-efficiency, and air-pollution standards.

The downward trajectory in Iran's struggling auto exports opened  nearly five years ago.

In the fiscal ending in March 2011, Iranian carmakers had shipped 82,000 units. In the following year however exports dropped by more than half to reach 38,258, according to Financial Tribune.

Last year (ended in March) Iran had targeted an export figure of 80,000 units but managed to ship 25,000 units – barely 31.2% of the set goal. With only four months to go before the yearend, it is highly unlikely that car manufacturers will be able to turn things around on the export front.