Sharq quoted him as saying the industry was being hurt by the government’s setting of prices for domestically made cars.
Separately, the head of the Iranian Association of Automobile Manufacturers, Ahmad Nematbakhsh, confirmed the drop and blamed it on “the lack of money available to the manufacturers” from the state, saying there was a “cash crisis.”
But foreign suppliers are also halting sales to Iran and that may be even more important, although Najafi-Manesh and Nematbakhsh did not address that.Peugeot used to supply Iran-Khodro, the country’s largest carmaker, with kits for several of its models. But that stopped a few months ago after Peugeot linked up with General Motors and was afraid of damaging its American business if it continued selling to Iran.
South Korean shipments have also reportedly ended.
The auto industry in Iran has not spoken of any problems with foreign supplies and has remained silent.
Mehdi Ghazanfari, the minister of industries, recently said that auto production in the last Persian year reached a record 1.6 million units. He didn’t say anything about production so far this year. But published figures said output in the first quarter was 241,548 vehicles.
Meanwhile, the Iranian Labor News Agency reported that the small Zagros Car Company had laid off 400 of its 500 workers and will likely go out of business. It said the problem was the severing of the firm’s relations with its Malaysian production partner.