A campaign to boycott “substandard and expensive” Iranian-made cars has fired up social media in the Islamic Republic of Iran, where its supporters have been accused of anti-revolutionary treason.
Iranians are turning to the Internet to vent long-simmering dissatisfaction with a domestic car industry dominated by producers Iran Khodro Industrial Group and Saipa Corp, following years of sanctions that led to the exit of foreign makers.
Almost 20,000 people die on Iran’s roads each year, and police say faulty cars are partly to blame.
Although domestic vehicles have features such as airbags and anti-lock brakes, “the safety of these cars is not satisfactory,” deputy police chief Eskandar Momeni said.
Iranian officials say that domestically produced cars are much cheaper than imported brands and that the industry has created hundreds of thousands of jobs.
“Creating and supporting campaigns not to buy cars is treason to the national interests,” Iranian Minister of Industry, Mines and Trade Mohammad Reza Nematzadeh said.
“This campaign is wrong, sinful and anti-revolutionary, and it would inflict damage on the domestic economy,” he added, in remarks that sparked an online backlash.
Iranian President Hassan Rouhani even waded into the row to urge his minister to “treat the critics respectfully.”
Public pressure made Saipa Corp chief executive officer Mehdi Jamali apologize to the public on television “for the low quality of our products in the past.”
Most Iranian cars are based on foreign models, which used to be brought in and assembled before sanctions were introduced.
Saipa’s Pride model, originally a Kia Motors Corp vehicle, is the cheapest Iranian car with a price tag of 200 million rials (US$6,676) — about 22 times the monthly minimum wage.
Iran’s car production stood at 1.65 million vehicles in 2011, but after European and US sanctions hit there was a dramatic drop, to about 740,000 in 2013. Production rose to 1.2 million last year.
Almost all foreign automakers have left the nation. French automaker Renault SA continues to import parts and assemble cars in Tehran, but at a fraction of its former output.
Fiat Chrysler Automobiles NV, Volkswagen AG, Mercedes-Benz and PSA Peugeot Citroen are among those now interested in gaining a foothold in Iran as sanctions are rolled back under a historic nuclear deal between Tehran and major powers.
Iranian manufacturers hope that the return of foreign partners would help them to increase production and improve quality.
Customs duties of up to 100 percent for vehicle imports ensure that quality foreign cars are out of reach for most Iranians.
Sales of imported Chinese vehicles are rising, helped by price cuts after a July 14 nuclear agreement in Vienna, but even they are still much more expensive than the average Iran-made car.
Automaking is Iran’s No. 2 industry after oil, accounting for up to 3 percent of GDP and 12 percent of jobs.
NOT ALL GOOD: Analysts warned that other data for last month might be less rosy due to the virus and analysts expect the PMI to contract again next month Chinese factory activity saw surprise growth last month as businesses went back to work following a lengthy shutdown, but analysts said that the economy faces a challenging recovery as external demand has been devastated by the COVID-19 pandemic, while the World Bank said that growth could screech to a halt. China is slowly returning to life after months of tough restrictions aimed at containing the virus, which put millions of people into virtual house arrest and brought economic activity to a near standstill. The strict measures saw a closely watched gauge of manufacturing plunge to its lowest level on record in February,
ALL ABOUT STRATEGY: The company is optimistic, saying that its gross margin should increase year-on-year, but it is scaling back on its plans to expand capacity Quang Viet Enterprise Co (QVE, 廣越), which makes down jackets and garments for sportswear and outdoor brands including Adidas AG, yesterday said that revenue might drop 5 to 10 percent annually this year as some customers trimmed orders in response to the COVID-19 pandemic. That would mark its first revenue decline since 2016. Quang Viet posted record-high revenue of NT$16.26 billion (US$537.45 million) last year, up 22 percent from 2018. Down jackets made up 40 percent of it revenue last year. North Face Inc and Patagonia Inc are this year likely to reduce orders by 20 to 30 percent from a
ELECTRONICS Lite-On delays sale of unit Lite-On Technology Corp (光寶科技) yesterday said it would postpone the sale of its solid-state drives (SSD) business to Kioxia Holdings Corp, formerly known as Toshiba Memory Holdings Corp, due to disruptions amid the COVID-19 pandemic. Last year, the Taiwan-based electronics components supplier struck the deal with the Japanese firm, agreeing to sell the unit for US$165 million. Citing unfinished integration work due to the pandemic, Lite-On has deferred today’s closing date until further notice, adding that the delay would not have a negative effect on the unit’s operations. AUTO PARTS Hiroca approves dividend Automotive interior parts supplier Hiroca
The output of the global smartphone industry this year is to contract by 7.8 percent on an annual basis as the COVID-19 pandemic ushers in a global recession, Taipei-based market researcher TrendForce Corp (集邦科技) said in a report on Monday. The global production of smartphones is expected to fall to 1.29 billion units, as the pandemic dampens demand for consumer electronics, leading to a decline in shipments across Europe and North America, TrendForce said. With consumers delaying smartphone purchases and thereby lengthening the device replacement cycle, overall prices would suffer a setback that is expected to negatively affect the profitability of smartphone