Renault ready to restart car production in Iran image

The French automaker said it resumed shipments to Iran and expects its car production in the country to pick up progressively throughout the first half of 2014.

Renault’s regional boss Gilles Normand said the temporary easing of sanctions has begun to allow a “very low” volume of parts shipments for vehicle assembly in Iran. Overland shipments of parts for the Tondar model, an Iranian version of Renault’s low-cost Dacia Logan car, have been leaving from Romania in the last 10 days after a six-month hiatus caused by last year’s further tightening of sanctions.

“The important thing is that we can gradually restart the supply of parts for vehicle production as well as the flow of payments,” said Normand, head of the carmaker’s Asia-Pacific operations, which include the Middle East. “There’s a window of opportunity for the next six months.”

Last week, Renault CEO Carlos Ghosn predicted that the Iran’s auto market is poised to grow by at least 50 % when sanctions against the country are lifted. Talking at the World Economic Forum in Davos, Ghosn said that the current market, which sells 700,000 to 800,000 cars a year, could jump to “anywhere between 1 million to 1.5 million cars.”

Renault stopped selling component kits for assembly in Iran last year, in line with trade sanctions. Renault’s global sales, including its Dacia and Samsung brands, rose 3 % last year to 2.63 million cars and light commercial vehicles. Growth was held back marginally as the manufacturer stopped sales in Iran, which cost the company 64,500 deliveries versus 2012.

Via Automotive News Europe