Iran signs its biggest auto deal in history with Groupe Renault
State-owned Industrial Development & Renovation Organization of Iran (IDRO) and privately-owned Negin Khodro signed the country’s biggest-ever automobile deal with French car maker Renault on Monday, according to Washington Post.
The 660 million ($778 million) agreement followed after ten months of negotiations between the parties and marks another production breakthrough since sanctions were lifted in 2015.
IDRO and Negin agreed upon a production rate of 150,000 vehicles per year which will be expected to create at least 3,000 jobs.
The plant in Iran’s capital, Tehran, will start manufacturing the most recent Duster and Symbol models by 2018.
“Renault will own 60 percent of the shares, and the rest will belong to Iran. From Iran’s 40 percent stake, 20 percent belongs to IDRO and 20 percent will go to the private sector (Negin Khodro)”, IDRO president Mansour Mozzami stated for PressTV.
Mozzami further emphasized Renault is obliged to export 30 percent of production, which will include both automobiles and components, and that the deal includes a second stage, which has not been finalized yet, regarding production in 2019.
Iran’s IRNA news agency reported the agreement also features building an engineering and sales center in the country.
Negin Khodro is the official Renault representative in Iran, responsible for sales and service of the French automaker’s products in Iran.
IDRO is one of the largest conglomerates in Asia, with the objective of developing Iran’s industry sector, to accelerate the industrialization process of the country and to export Iranian products worldwide. It was founded by Shah Mohammed Reza Pahlavi in 1967.
Iran produces approximately 1,350,000 vehicles yearly, the authorities hoping that this number will exceed 3 million by 2025.
The value of Renault’s deal is above the joint venture signed between rival French car maker Peugeot-Citroen (PSA) and Iran Khodro (€400 million) last year, aimed to produce 200,000 vehicles per year in 2018.
Also, since the Vienna negotiations from two years ago, Iran has placed a $27 billion order on 114 Airbus planes.