September 06, 2019
The Iranian government is determined to sell off its remaining shares in the two giant automakers, saying IKCO and SAIPA will be fully privatized in the next Persian year.
A senior member of the Expediency Council, Gholamreza Mesbahi-Moqaddam, told the state news agency June 26 that the privatization would make the car industry more competitive.
Mesbahi-Moqaddam, a former Majlis deputy who is believed to be influential in economic decisions, said the government is determined to end its “special support” for Iran Khodro (IKCO) and SAIPA.
The remarks come as the government and private shareholders in IKCO and SAIPA are still at odds on how they should price the cars following the collapse of the rial last year.
The main private shareholders in the two companies are parts makers who believe production cannot continue with pricing methods dictated by the government.
Estimates suggest the Iranian government owns 14 percent of IKCO and 17 percent of SAIPA, although many industry analysts insist the government owns a much bigger share in the two firms through its state-owned companies and agencies.
Industry Minister Reza Rahmani told journalists in Tehran June 22 that the government would conclude the process to privatize the two main car manufacturers by the end the next Iranian calendar year in March 2021.
“The transfer [of ownership] has already begun this year with non-manufacturing asserts and the subsidiary companies,” said Rahmani, adding, “I am serious in dealing with this.”