Iranian automakers deep in red

Financial Tribune – By highlighting the automakers’ massive debt to local parts suppliers, industry lobbyists are once again calling on state authorities to extend loan facilities to these firms

Marred with mismanagement amid an economic crisis, Iran’s auto industry is saddled with a massive debt, the head of a local guild of auto parts makers said.

Arash Mohebbinejad also told IRNA, “Iranian carmakers owe local parts manufacturers 310 trillion rials.”

Calculated on the open market forex rate of $1 to 157,000 rials on Wednesday, 310 trillion rials would amount to $1.97 billion.

This is while semi-state carmakers Iran Khodro (IKCO) and SAIPA receive hard currency loan facilities at the subsidized rate of $1 to 42,000 rials.

Mohebbinejad is the secretary of Iran Specialized Manufacturers of Auto Parts Association, a lobbying arm of the industry and the official debt collector.